The scale of debt crippling working families in January as heating costs rocket and Christmas bills pile in is laid bare tonight.
Research reveals the surge in desperate households getting deeper into debt between December and January.
Some 16% of those quizzed had turned to credit unions in January, compared with just 4% in December.
Seventeen-per-cent were mired in their overdraft this month, a hike from 4% the previous month.
And 12% had taken out a bank loan this month, against just 1% in December.
Worryingly, the percentage of workers going to payday loan firms climbed from 2% to 6% in a matter of weeks.
And those asking family and friends for help rose from 2% to 8% -potentially increasing pressure on already-stretched budgets.
Those raiding their savings soared from 2% to 9% and workers turning to their “emergency funds” rose from 3% to 4%.
Fintech firm Hastee Pay quizzed 1,001 adults in a range of salary brackets, from under £10,000 to more than £100,000.
Some 58% earned under £40,000 and 18% under £20,000.
Just over a quarter – 26% – worked in the gig economy, while a third were public sector workers.
Hastee Pay’s chief executive James Herbert said: “Our research shows that January is a punishing month financially for many workers across the UK.
“Reliance on high-cost credit dramatically increases at the start of the year, pushing people into a spiralling cycle of debt.
“A multitude of factors come into play in January, creating a perfect storm for falling into debt – not only are people paying off their Christmas bills and retailers offering tempting sales, they’re also trying to stretch their December pay over a longer period of time.
“Importantly, the problem doesn’t end in February.
“Financial stress is a problem across the entire calendar year and more needs to be done to ensure that the vast majority (87%) of workers who have had to cover unexpected costs in the last 12 months can do so without relying on crippling high-cost credit.”
The Mirror, which is campaigning for Fair Credit For All, told in November how families are potentially sitting on a £96billion secret debt mountain as people hide the fact they owe cash from their relatives or friends.
The scale of hidden debt amounts to an eyewatering £4,164 per person, according to the Money Advice Service.
And earlier this month, figures from a TUC study showed personal debt has hit its worst-ever levels, with the total amount at £428billion – or £15,400 for the average household.
Debt advice expert, Caroline Siarkiewicz, director at the Single Financial Guidance Body, said: “January is one of our busiest months for people seeking debt advice, but we know that there are many more
people who are not seeking out the help they need – in fact less than a quarter of people in debt seek help.
“If you are struggling with managing debt, an important first step is to seek free advice as early as possible, which can prevent problems spiralling out of control.
“More than eight out of ten people who have sought debt advice tell us they feel less stressed or anxious and more in control after talking to someone.
“The Money Advice Service website has a free debt advice locator tool which will help you find your nearest adviser and talk to them in a way that’s best for you – online, over the phone or face-to-face.
“Our research has found nearly two-thirds of clients with debts (64%) have reduced or cleared these within three to six months of seeking advice.”
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