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49% of Brits overly cash-happy on payday

49% of Brits overly cash-happy on payday

Category: Money
30/11/2016

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Today marks the end of another month, and payday for many companies. Yet new research suggests that some Brits get a bit too happy spending their fresh cash on payday, with 49% making unnecessary purchases as soon as they get paid.

The research, conducted by Paymentsense, went on to reveal that a quarter of UK workers admit to spending 25% of their month's pay within 72 hours of getting the money in their current account. This translates to an average spend of as much as £462.50 in three days, and this money does not necessarily go to the essentials, either. Indeed, a third of respondents said they spend between £41 and £60 on socialising on the first weekend after payday, while half believe they spend most of their disposable income on food.

However, this food spend tends to change over the course of the month, with an overindulgence just after payday often resulting in people needing to adjust their eating habits towards the end of the month to accommodate their lack of money. Nearly 50% of women and 32% of men even go on a diet at least once every six months to reduce their spending.

The figures went on to reveal that women might have more of a financial need to cut back their spending than men, with 56% of women splurging on non-essentials following payday, compared with 38% of men. Perhaps as a result of this, the same percentage (56%) of women also struggle with money in the days before payday, compared with 39% of men.

That doesn't mean men don't celebrate their fresh cash, though, as nearly double the number of men said they get in a round of drinks following payday when compared to women. Additionally, 41% of women pay off their debts within 72 hours of being paid, compared with 31% of men, so women may not be struggling just because of unnecessary spending near the end of the month.

Nearly a quarter of people may find they need to pay off their credit card or overdraft on payday, as this is the percentage that rely on credit to get through the final few days of the month – a number that rises to 27% of 45-54 year olds. This is quite surprising, as the youngest workers tend to spend their disposable income the fastest, with 17% of 18 to 24-year-olds filling their online shopping basket each month so they're ready to click 'buy' as soon as they get paid. However, 10% of these purchases get returned once the payday-blues hits, which might decrease these regretful shoppers' need to rely on credit later.

All in all, there are plenty of reasons to think before you shop this (and any) payday. Instead of spending your money, maybe you can also feel rich by putting some into a dedicated savings account. After all, watching your money grow and feeling a sense of security from a financial safety net that's building up could be quite a powerful motivator.

If you can't resist the call of the shops, consider each of your purchases carefully before you buy – even a minute of consideration can make a difference to how you feel about what you're buying. And if you must turn to credit, consider a Best Buy 0% purchase card to give you time to pay off your debt before you need to start paying interest. A bit of strategic thinking at payday can save you a lot of beans-on-toast dinners near the end of the month.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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