January Blues: Affording January

With dark nights and cold days, January can be a tough month for many. Our new report reveals that this January may be even more difficult than usual, with 39% of households expecting to face financial issues due to the ongoing impact of COVID-19.

Why this January might be more difficult financially

The ongoing impact of COVID-19 will have an effect on lots of UK families. Our research[1] suggests that more than a third of UK households expect to struggle this year, and the pandemic may have caused increased financial pressures for Christmas 2020.

Our survey on this topic found that many respondents felt pressured to spend more than they could afford, and that many households - especially young people - were intending to use credit to fund their Christmas celebrations[2]. In fact, when asked why they might struggle to cover the month of January, 40% of respondents suggested that Christmas spending would reduce their regular disposable income.

As well as the pressures of Christmas and issues caused by the pandemic, January might feel harder than usual financially due to an earlier December pay date. 93% of the UK had their pay date brought forward before Christmas, which could cause issues for household budgeting. Almost a quarter of respondents (22%) suggested that changed pay dates and the longer month would cause financial strain in January[1].

If you’re finding January difficult, or facing issues with your usual monthly budget, we can help. If you have questions or concerns about your Lowell payment plan, get in touch with our friendly and supportive team, who will be able to advise how we can work together and help you.

How UK households are planning to fund the long month

The long gap between pay dates in December and January might cause even more financial strain, as households turn to alternative means of funding the long month of January. 23% of households suggested they would be using credit cards to fund January, with 17% of respondents taking money out of their savings[1].

10% of respondents were considering taking out a loan to help cover the month, and 9% were planning on using a payday loan[1]. This could result in further financial issues further down the line, especially with the UK now in its third national lockdown, which could cause potential impacts on salaries and household budgets. As always, Lowell are here to support our customers. We’re here for you in these uncertain times, and you can read more about our commitments to supporting you at our Support Centre page.

The date you might feel the strain

Our research[1]suggests that there’s a specific day in which many UK households will feel that strain – Wednesday the 20th of January 2021. This date is, on average, still a week away from the January pay date. The 20th also falls just two days after ‘Blue Monday’, a date that’s often touted as ‘the most depressing day of the year’. But don’t let the prospect of this date haunt you too much. Instead, check out our blog on how to beat Blue Monday and boost your mental wellbeing in January.

If your salary is being affected by the pandemic and national lockdowns, you might be concerned about the impact on your budget in January. If you’re a Lowell customer and your circumstances have changed because of the coronavirus outbreak or lockdowns, we can help. For more advice, check out our guide to your next steps.

Written by Emma Sams on 18 January 2021


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[1] Survey of 1000 UK respondents conducted via The Leadership Factor on behalf of Lowell January 2021

[2] Survey of 1000 UK respondents conducted via The Leadership Factor on behalf of Lowell, December 2020 – see findings here: https://lowell.co.uk/about-us/lowells-blog/lifestyle/christmas-pressure/