Bankrupted by Christmas

LONDON – Almost 30 000 Britons are expected to become insolvent in the first three months of 2007 with a third getting in trouble because of excessive Christmas spending, accountants Grant Thornton said yesterday.

The firm said its prediction followed a record number of personal insolvencies in 2006 with the number of exceeding 100 000 for the first time. “Last year, during the period straight after Christmas, when most bills started to hit the doormat, we witnessed the highest ever amount of people going into personal insolvency,” said Mike Gerrard, head of Grant Thornton’s personal insolvency practice.”This year things could be even worse.”He said interest rate rises, higher utility bills and an increase in unemployment would cause more people to suffer financial problems.However, despite the increasing pressure on wallets, people were continuing to splash out during Christmas and in the January sales.”A little overspend will not break the bank for most, but for those who are already financially overstretched, spending that little bit more during the festivities can represent the last straw that breaks the camel’s back,” Gerrard said.Citizens Advice said it had seen indications people could be facing problems.”We do see evidence of a Christmas debt hangover, and this month we expect to exceed the 140 000 debt problems that Citizens Advice bureaux dealt with in January 2006,” said spokeswoman Sarah Miller.Nampa-Reuters”Last year, during the period straight after Christmas, when most bills started to hit the doormat, we witnessed the highest ever amount of people going into personal insolvency,” said Mike Gerrard, head of Grant Thornton’s personal insolvency practice.”This year things could be even worse.”He said interest rate rises, higher utility bills and an increase in unemployment would cause more people to suffer financial problems.However, despite the increasing pressure on wallets, people were continuing to splash out during Christmas and in the January sales.”A little overspend will not break the bank for most, but for those who are already financially overstretched, spending that little bit more during the festivities can represent the last straw that breaks the camel’s back,” Gerrard said.Citizens Advice said it had seen indications people could be facing problems.”We do see evidence of a Christmas debt hangover, and this month we expect to exceed the 140 000 debt problems that Citizens Advice bureaux dealt with in January 2006,” said spokeswoman Sarah Miller.Nampa-Reuters