Consumers turn to credit card to pay for daily essentials in January
A third of people with credit cards (35 per cent or 12 million people) will rely on their plastic to pay for daily essentials in January, according to the Post Office Consumer Credit Report.
The expense of the festive season and rising living costs has left many consumers feeling the pinch with over two-fifths (42 per cent) confessing they will use their credit card to pay for everyday grocery shopping. In the rush to grab a bargain in the January sales, nearly a third (30 per cent) admit they will turn to plastic to pay for any sales shopping.
It also looks like people will continue to rely on the credit card over the year with one in 12 (eight per cent) admitting they will use their plastic more frequently for everyday purchases.
The table below highlights the percentage of people who plan to use their credit card for purchases in January 2013
Purchases - Percentage of people that will use their credit card in January 2013
Grocery shopping 42 per cent
Day-to-day purchases 35 per cent
January sales 30 per cent
Booking a holiday 25 per cent
Major household purchase (eg new kitchen sofa) 16 per cent
Paying off Christmas bills/debts 8 per cent
Domestic bills (eg gas or electricity) 7 per cent
Consumers in London, whose Christmas festivities may have been more expensive because of the high prices in the capital, are most likely to turn to their credit card this January (18 per cent), compared to just five per cent of people in the North West.
The report highlights three million people (nine per cent of credit card users) expect to spend more on their credit card this month compared with January last year - by nearly £300 on average.
John Willcock, Head of Credit Cards at Post Office, said: "While many people intend to manage their credit card purchases and repayments sensibly, there are still too many people who are not thinking of the consequences of their festive spending. It is surprising to see so many people forced to rely on their plastic for daily essentials this month.
"The New Year is the ideal time to think about financial planning and organising a household budget. I urge people to check their interest charges and consider switching to a deal with a zero per cent offer on purchases and balance transfers. People with debts spread across different cards may benefit from consolidating their debts on to one card to make them easier to manage and to reduce the amount of interest being paid."
To find out more about the Post Office Credit Card and Post Office Travel Money, log onto postoffice.co.uk.