Two fifths of people are expected to run out of money before payday this month and research from Nationwide found 40% have already run out of money while waiting for their January salary to hit their account. 14% said they’d already run out of money by January 11.
One in five say they are avoiding social plans altogether, and one in 10 are doing Dry January in order to cut down on unnecessary spending. Nationwide money expert Bola Sol said: “A monthly budget is your financial compass. With December to January stretching paydays to the limit, knowing where every pound is going is vital. Whether you’re saving for a big event like a wedding, a hen-do, or that dream purchase, consistency is the flex that’ll get you there.”
Financial insights provider Intuit Credit Karma said of those who think they will run out of money this month, more than half said January 15 was the last day they will have any spare cash. With December wages often being paid early, January can be a month when people need to stretch their pay out for longer.
A similar study last year put January 20, 2024, as the tipping point when people would start relying funds other than their income to make it until the next payday.
A quarter of people in the latest survey said that they had spent more during the most recent festive season than in previous years. January 4 was the busiest day this seasson to apply for credit.
Akansha Nath, general manager (international) at Intuit Credit Karma said: “Many people enter January with stretched budgets, making it a good time to consider a budget planning tool, consolidate debt, or take advantage of interest-free balance transfer offers.”