Quarter of Brits in the red two weeks after payday

17 July 2014

More than a quarter (27%) of Brits hit their overdraft just 17 days after payday, research has found.

Worryingly, more than one in five adults (21%) admit they reach their overdraft within just a week of payday, while 13% are in the red just a day after they get paid. One in a hundred are overdrawn all month long, according to thinkmoney.co.uk.

Its research found that younger Brits are more likely to be overdrawn, with 50% of 18 to 24 year olds admitting they are in the red for at least part of the month, compared to just 22% of the over 55s.

Safety net

Spokesman for Thinkmoney.co.uk Ian Williams said: "An overdraft should be a safety net, to help when something goes wrong. But it appears for many people being overdrawn has become the norm. In fact, many don’t regard it as a debt, but it is and spending most of the month overdrawn is a worrying position to be in.

"Whilst an authorised overdraft may be costly, an unauthorised overdraft could result in hefty charges and penalties."

The research comes after the news that wage rises including bonuses are at their lowest level since 2009. Average wages in March to May were just 0.3% higher than they were 12 months ago, while inflation rose to 1.9% in June, up from 1.5% in May, in an indication that Brits are still feeling a financial squeeze.

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