Millions of Australians set to battle credit card debt following Christmas spend
Millions of Australians face a significant concern following the holiday period, with many needing more than 12 months to resolve it.
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Thirty-eight per cent of Australians, equal to 7.7 million people, have racked up large amounts of Christmas debt, with many not being able to pay it back within 12 months, new data reveals.
The Finder survey which had 1039 respondents, found that 3 per cent, or 600,000 people, would not be able to settle up by the time Christmas 2024 rolled around.
The research showed that 16 per cent would be able to pay back their debt within a month, 15 per cent would take between one to five months and 5 per cent would need six to 11 months to get square.
Finder credit card expert Amy Bradney-George said the holiday period was often one of financial stress for people.
“Many Australians experience significant financial stress over the holiday period,” she said.
“The pressure of gift giving and festive activities can often lead to overspending and an increased reliance on credit.”
Ms Bradney-George said careful planning could help ease the burden of paying off the Christmas debt that people had accrued.
“Find areas of spending you can trim down, such as eating out and entertainment, and avoid spending on non-essentials until your Christmas debt is settled,” she said
“Create a detailed repayment plan and prioritise paying off high-interest debt first until it’s all cleared.
“Set little goals along the way so you’re able to track your progress over time and stay motivated, just like you might set them for your health and fitness.”
There were also options for those struggling to clear their debt, Ms Bradney-George said.
“A balance transfer card can give you some breathing room by offering 0 per cent interest on the balance you move to the new card, sometimes for up to 32 months,” she said.
“If you’re facing significant challenges, you can also speak to a financial counsellor for free by calling the National Debt Helpline.”
The large Christmas debt coincides with the cost-of-living crisis. The average Australian was expected to spend 10 per cent more in 2023 than 2022 on the festive season at an average of more than $1000.
A previous Finder study found the average Australian would spend $1479 on presents, food, alcohol, eating out and travel at Christmas, with the country spending upwards of $30bn in the December quarter.
Originally published as Millions of Australians set to battle credit card debt following Christmas spend
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