With the Christmas decorations packed away for another year, all that should remain of the festive season is some soft centred Quality Street and happy memories. But for many throughout North Wales the remnants of the festive are far less pleasant – debt.
Reports have revealed that a third of North Wales families funded Christmas 2012 on credit, and debt counsellors in the region fear hundreds risk losing their homes as they slip further into the red, with many still paying off their debt for Christmas 2011.
There is no doubt that Christmas is a time of enormous financial pressure for people and it is easy to understand why so many throw caution to the wind with regards their finances at this time of year. Not wanting to disappoint young children who do not understand that the presents left by Santa cost mum and dad dearly, many parents turn to credit cards and loans. Even those without children or whose children are grown up don’t want to disappoint loved ones – nobody wants to be seen as the ‘Scrooge’ of the family – and so they turn to credit and now face the start of 2013 worrying about how they are going to make the repayments each month.
The financial pressures of Christmas will never go away, the only way of reducing the number of people facing debt at start of the New Year in the future is through financial education. People need to be taught how to improve the way they manage their household finances and not give in to the temptation put their way by unscrupulous lenders.
The pay day loan market has grown rapidly in recent years making it all too easy for people to access the short term benefits of salary advances. But we need to arm people with knowledge of what these loans entail - 50% of those taking out pay day loans cannot afford to repay them.
When I was in school there were no lessons in money management and many of my generation entered adult life totally clueless about budgeting and living within your means.
I was therefore very pleased when in 2008 education in personal financial management was introduced into Welsh classrooms for all pupils between 7 and 19 years of age. With personal debt in Wales at a record high, it is common sense that pupils are equipped with the vital practical skills they need to manage their finances properly and avoid unnecessary debt when they leave school – especially with so many students having to face large loans to fund them through university.
Hopefully this education will pay off and the younger generation won't find themselves in the difficult financial position that so many in North Wales now find themselves in. But we shouldn't just be focusing on the young, the older generation who missed out on the vital life lessons in financial management in school also need educating and the Welsh Government should do more to support them too.
Christmas should be a time to look forward to, not dread, and I urge those facing debt this new year to seek professional advice on the best way of managing it and preventing getting further into the red so that the start of 2014 can be more prosperous and less stressful.