Facing the financial facts on the 'most depressing day of the year' as Blue Monday approaches

January is one of the busiest times of the year for Debt Advice charities. At Debt Advice Foundation, calls to the charity’s helpline almost double in January in comparison to December. 

All the bills that were there before Christmas are still there, but now there are some new ones; recent BarclayCard research revealed that consumer spending rose by 4% in December in comparison to last year. 
The second half of the month is when people really start to feel the pinch. Indeed the third Monday of January is known as “Blue Monday” because of this. 
Realising it is still 10 days until pay day, many people try to consolidate their debt, onto a 0% interest credit card for example, and if they are rejected due to their credit score, they realise help is needed and turn to a debt advice provider. On average almost 89% of debts reported to Debt Advice Foundation advisers are from credit cards and personal loans. 
Now is the time to take a good look at our money lifestyles – to find out exactly where the money goes each month. Below are some tips on how to survive Blue Monday, and remember debt advice charities are there to offer support if you are still struggling.
Don’t ignore the problem. Open every letter that you receive to be sure you know what you owe. 
For one week, see if you can account for every penny you spend, such as on lunches and coffee shop drinks. It’s about understanding what you spend, where you spend and how you spend.  
Running a household is like running a small business. So give yourself a couple of hours, sit down with a pad or a spreadsheet and list all the bills you have to pay every month to keep the everything going.  Those are your first priority. Then list debts such as your car, credit cards, catalogue payments and personal loans. Then all the rest – paid-for TV services like Netflix, gym memberships etc. Now add up your income and work out the difference. Hopefully there’s money left over every month so you can start to pay the debts off. If not, you may need to look at what you can cut or get further financial advice. Debt Advice Foundation has a Budget Planner which may help. 
Think about next year. Add up how much you really spent over Christmas and New Year, including presents, bubbly and food. Divide that by 12 and start putting money into a savings account, avoiding the temptation to get more credit. 
Remember it’s more important to pay bills such as rent and electricity than credit card and loan debts as that is what keeps you in your home. You should make these payments before anything else. 
*based on completed advice cases for the period July-October 2015