We spend 43% of disposable income within 24 hours of payday
Payday can seem like a long time to some, with the temptation to splurge as soon as it hits the bank account too much.
With this in mind, financial experts Moneywise analyzed UK spending habits to uncover the top 10 payday spending statistics with the aim of educating Brits about the importance of saving and to help fight payday splurge.
Top 10 Payday Spending Statistics
- Belfast spends the most on payday
- 43% of our disposable income is spent within 24 hours of payday
- 92% of Britons regularly make impulse purchases that they later regret
- 60% of Brits have less than £ 100 before payday
- Biggest grocery stores are our biggest payday madness
- 52% of Britons are forced to raise extra money each month to complete them
- Paying off debts is the biggest payday expense for 1 in 3 Britons
- 23% of Britons spend half of their income on payday
- 32% of UK shoppers double their payday spending
- 25-34 year olds use payday loans and short-term borrowers the most
Portafina analyzed the top ten “payday millionaire” cities (based on the greatest number of people who spent 50% or more of their disposable income within 24 hours of paying). Belfast leads the highest spending with 27%.
- Belfast (27%)
- Liverpool (20%)
- Dublin (16.7%)
- Birmingham (16%)
- London (14.9%)
- Manchester (14.8%)
- Edinburgh (14%)
- Newcastle (13%)
- Bristol (12.2%)
The Portafina survey shows that 43% of our monthly disposable income is spent within 24 hours of payday, and 81% is spent within seven days.
According to a study of 4,000 UK shoppers from Nationwide, 92% of Brits who reported regularly making impulse purchases went on to regret their spending choices.
In fact, they found that 22% of Brits said more than half of their pocket money, excluding bills and essentials, was gone within the first two days of payment.
60% of Brits have less than £ 100 in their account the week before payday and 15% have no money at the end of the month.
The most popular payday splurges according to Nationwide are:
- Larger-than-usual grocery stores (27%)
- Take a takeaway (24%)
- Buy new clothes (20%) Eat out (16%)
- Going to the pub (12%)
KPMG found that 52% of people in the UK are forced to raise extra cash to accompany them until their next salary. 21% turn to credit cards, 13% overdrafts and 12% borrow from their partner.
We’ve all been the victims of payday madness, but if this habit happens too often it can take a toll on your finances. KPMG found that 23% of people spend 50% of their income on payday.
While the biggest luxury payday craze has been identified as buying food, KPMG analysis found credit card and debt repayments to be the biggest expense for 1 in 3 people.
A Post Office Money study found that 32% of people double their discretionary spending the day they get their hands on their paycheck. They also found that shoppers make an average of two unscheduled purchases per week.
The FCA found that 37% of payday loan borrowers and 29% of short-term installment borrowers are between the ages of 25 and 34.
- Don’t be tempted. Sign up for a payroll savings plan.
- Track your spending to save more and spend less.
- Put your savings aside as soon as you get paid.
- Try to save 10% of your income each month.
- Try the 365 Day Money Saving Challenge. Save a little every day: £ 1 on Monday, £ 2 on Tuesday, up to £ 7 on Sunday. Then start again the following week. You can save £ 28 per week, saving £ 1,456 by the end of the year.
- Buy in bulk whenever possible to keep costs down in the long run.