Christmas could cost you as much as 72 per cent more if you use a three month payday loan, according to Citizens Advice.
New research by Citizens Advice found that with a typical payday loan, taken out for three months, the average cost of Christmas rises from £821 to £1,413.
Citizens Advice looked at the impact on cost if someone paid for Christmas using a payday loan, overdraft, or credit card, repaying three months later.
Credit cards increased the cost by 8.4 per cent, up to £891, whilst an arranged overdraft led to a rise of 15 per cent, costing £945.
The research also listed some of the price changes when using a payday loan to pay for Christmas items. A £25 turkey would cost £43, a £45 Christmas tree would cost £77.40, and a £44.50 perfume bottle (50ml) would cost £76.54.
“It is important that anyone thinking about turning to credit to help pay for Christmas understands the full costs involved and if they can actually afford to pay it back,” said Hitesh Patel, of the Citizens Advice Bureau in Halton, Cheshire.
“There’s still time to plan and budget for the festive season. Anyone worried about their finances should seek advice before taking on credit to help them avoid starting 2016 in debt.”
It is important to search around for the best prices in shops, especially during the festive period, and to carefully consider all your options before taking out a payday loan or other financial aid.
