A quarter of people 'don’t know where their money goes'
January is the time of year when people make resolutions for the year ahead. To quit smoking … to eat more healthily … or to try something new.
But for many, just getting in control of their money will top their New Year's resolution list.
And with over a quarter (27%) of respondents to a recent AA survey saying they 'didn’t know where their money went' over Christmas, it’s a financial resolution that really shouldn't be broken. While the AA/Populus research among AA members* showed that almost three-quarters (72%) of people said that they had their Christmas spending 'well planned', the number who clearly didn’t have their Christmas costs under control is worrying – and 12% said 'sort out our finances' was right at the top of their list of resolutions.
Mark Huggins, director of AA Financial Services, says that many people begin to think more carefully about their finances in January when the bills start to arrive after the Christmas shopping, and points out that January is a time when there is a seasonal increase in the number of personal loans taken out.
Borrowing rates are lower now than they have been for some time, and the AA’s offer is one of its best-ever rates
Mark Huggins, director of AA Financial Services
Huggins says, "This suggests that many people review and reorganise their family budgets for the New Year, and taking out a personal loan can be a helpful strategy for some. It can reduce the cost of credit by combining existing balances on loans, cards and overdraft facilities into one convenient, fixed monthly payment, as well as provide some cash for future use. Huggins points out that “Well-planned management of personal finances can help to reduce outgoings and also provide some scope to consider future expenditure.
The start of the New Year can also be a time for planning for big events or projects. For instance, there are real bargains to be obtained if you want a new kitchen or bathroom, and new car registrations start at the beginning of March; maybe you need a new car. This year might bring happy but costly occasions too, such as a family wedding or significant anniversary."
To help people realise their New Year's resolutions, AA Financial Services has slashed its personal lending rate for AA members to 4.8% APR representative. for loans of between £7,500 and £15,000 (4.9% for non-members). Huggins points out that "Well-planned management of personal finances can help to reduce outgoings and also provide some scope to consider future expenditure."
Here are some key regional findings from the AA/Populus spending research
Londoners appeared to be the least well organised with fewer than two-thirds (63%) saying that they had their Christmas spending planned and under control. Those in Northern Ireland were the best organised.
Those in the North-west (22%) were most likely to have 'no idea how they would pay for everything', with the Welsh close behind. (20%)
* Populus interviewed 1,822 adults aged 18+ on The AA/Populus online panel between 28 November and 5 December 2013. Populus www.populus.co.uk is a founder member of the British Polling Council and abides by its rules.
(16 January 2014)