A new financial tool has been unveiled that calculates the exact moment your finances will recover from the Christmas splurge.
Simply input how much cash you’ve splashed over the festive season and your anticipated January earnings, and it’ll pinpoint the day you’ll have balanced the books. The tool will also offer advice on how to cut back on spending to help compensate for pricey Christmas costs.
It follows a study that revealed that although 75 per cent of Brits recognise the importance of having a budget for the Christmas period, only half actually implement one, while 37 per cent confess they lose sight of their finances in December.
In December the average Brit spends an additional £649 than any other month. Socialising claims £120, food and drink tally up to £204, travel costs hit £120, and gifts take up the most with the average person spending £321.
Hence, a whopping 60 per cent report that January is ‘always’ financially tight as they attempt to offset Christmas spending.
To make matters worse, a third of Brits are paid earlier in December meaning they have to wait longer until their next payday, and as a result have to make their January spending stretch further.
“January is the perfect time to be smart with your cash,” remarked Rajan Lakhani, Head of Money at smart money app Plum, which conducted the study. “With smart budgeting, extra Christmas spending can be dealt with and you won’t have to make major cutbacks for weeks just to get through to payday in February.”
Try out Plum’s new year budget tool here
In addition to a longer wait period between pay days, half worry about energy bills adding to the costs, given the colder weather in January. For this reason a third become more strict on heating usage.
Other ways Brits try to conserve funds in January is by dining out less, reducing grocery bills and a third vow to cut back on takeaways.
The survey shows that two-thirds plan to save money in January 2025. However, for 27 per cent, December’s spending habits will likely hinder their savings goals for the upcoming year.
Rajan Lakhani further commented: “Christmas is a wonderful time for giving, but it can often stretch our budgets to the limit. Between gifts, festive meals, and social gatherings, the costs add up quickly.
“While it’s a season for generosity, it’s also important to remember that financial wellbeing doesn’t take a holiday. January, with its quieter pace, is the perfect time to reassess where your money went and start fresh.”