It is the season of the year when consumption peaks, and even as the economy tightens, many people still stretch what they spend to keep traditions alive. Gifts, meals, outings, and festive drinks with family and friends are the triggers that push most households’ budgets during this period, and not everyone is well positioned to handle the cost.
Up to 31% of consumers in the Community of Valencia admit they tend to borrow more to buy gifts and food during the holidays. The motive, they explain, is to preserve traditions and keep the family united, treating the expense as a duty. This pattern is reflected in the European Consumer Payments Report by Intrum, which notes that the rate is higher than the national average, where 24% now admit over-indebtedness, and the figure falls to 16% at the European level.
As the firm that specializes in recovery highlights, this behavior can push many households toward remedies such as deferred payments or loans, which jeopardize the sustainability of their finances.
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In fact, the analysis shows that 22% of respondents in the Community of Valencia expect to owe more than ever by the end of the Christmas celebrations. In this regard, the country average sits at 24%, three points above the European average of 21%.
Moreover, 53% of Valencians agree that Christmas is facing a worse financial situation, a sentiment one point higher than those who say the same nationwide compared with a year ago.
According to Intrum, the report shows Spaniards should learn how to manage money wisely this Christmas, avoid debt, and complete essential tasks. The current economic climate underscores the importance of saving and having financial support for any contingency.
Therefore, these dates may be the right moment to reassess and rethink how household finances are managed, leaving behind past mistakes. It could be a stepping stone to starting the new year with healthier finances and avoiding the January cost crunch.
In 2022, 59% of euro area purchases were paid with cash
Across Europe, Greeks were the most tolerant of debt during this period, with 34% of those surveyed, followed by the Irish at 29%. In contrast, Estonians are the most prudent with spending, with only 6% using excessive credit.