Kiwis left with a $533 million post-Christmas debt hangover
06 January, 2020, New Zealand – Kiwis are now faced with a mountain of debt after Christmas according to financial comparison site Finder, which has recently launched in New Zealand.
A Finder survey of 2,117 New Zealanders revealed that 44% of the population planned on using some form of credit to fund their Christmas shopping.
The research found that the average Kiwi spent $319 on gifts, upping the national spend to $1.17 billion. Approximately $533 million of this was paid for on credit.
Angus Kidman, Finder’s global editor-in-chief, said that the gift buying frenzy at Christmas would have left many Kiwis with lighter pockets.
“The pressure to overspend has left many nursing a New Year ‘financial hangover’.
“January is when credit card and other bills begin to land, leaving many regretting what they’ve spent on Christmas,” he said.
Almost a third (32%) of Kiwis used a credit card to pay for Christmas, while 8% turned to buy now pay later options such as Afterpay and Laybuy.
Around 4% were planning on taking out a loan to tide them over, and a cash-strapped 3% needed to borrow money from friends and family.
Just over half (53%) the population relied on their savings to fund their Christmas expenses.
Kidman said that the cost of Christmas will roll over well into the new year.
“It’s always advisable to pay off your credit card balance as soon as possible. That way it’s not sitting there building up interest.
“If you have a large balance and you think you'll need some time to pay it off, consider a 0% balance transfer card. But make sure to pay off all your debt during the interest-free period so you don’t get stung with higher charges down the track," he said.
|How do you primarily plan on funding Christmas this year?|
|Buy now, pay later||8%|
|Borrowing from friends or family||3%|
|Pay day loan||1%|
|Refinancing home loan||1%|
Source: Finder New Zealand survey