A survey by Sainsbury’s Bank has revealed that more than a quarter of respondents did not think they would be able to clear their Christmas debt by the end of this month.
A further 569,000 expected that clearing their festive debt would take more than a year.
The bank also estimates that this indebtedness will lead to more than half a million personal loans being taken out between January and March of this year, amounting to a total of over £5 billion.
Many people choose to consolidate their debts into one loan after the Christmas period in order to sort out their finances, but the bank warned that they should take time to ensure they have the best rate available.
Steven Baillie, loans manager at Sainsbury’s Bank, said: “Sadly, many people don’t shop around when taking out a personal loan, wrongly assuming they can only obtain a loan from the bank or building society they have their current account with.
“Consolidating your debts with a more competitive loan could save you hundreds or thousands of pounds in interest so it’s important to shop around to find a competitive rate.”
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