You may have heard the term “January has 60 days” before, whether at your workplace, at home, or just somewhere around.

As absurd as the term sounds, that is the financial truth for many in the formal sector.

As the holiday decorations are packed away and the new year begins, many households face a harsh financial reality.

January often brings a wave of money-related stress, often dubbed the "January squeeze" or post-holiday debt hangover.

With bills, fees, and dozens of other financial obligations waiting for many salary earners, it’s no wonder people consider January the most financially stressful month of the year.

Here is why January is the most difficult month of the year and tips on how to plan for a better January.

The Aftermath of Holiday Spending

December's festive season, characterised by gifts, parties, travels, and expensive meals, often lead to significant overspending.

Many even end up accumulating debt that takes months to pay off. Surveys reveal that many people blame Christmas spending for January's financial strain, with many reporting regret and increased debts.

This post-holiday debt cycle leaves wallets feeling empty and budgets stretched thin.

The Extended Pay Gap

Many workers receive an early December pay to cover holiday expenses, usually around December 23, resulting in a longer-than-usual wait for January's salary, which sometimes stretches to five or six weeks.

This extended gap forces people to stretch limited funds further, especially after the holiday spending depletes their funds.

This in turn makes January tougher financially.

Bills and Taxes

January is usually the start of the financial year, which means tax reforms and utility tariff increments go into effect.

Work begins, which means budgeting for transportation and feeding for the month.

Additionally, for many with children of school going age, school resumes, along with school fees, stationaries and additional expenses for the children.

So, while many are already tightening their belts for January, increased taxes, water and electricity bills, school fees, transportation costs and many more would also poke a few more holes in their belts.

Pressure from New Year Resolutions

Ambitious promises to save more, pay off debts, pick up new hobbies or budget strictly fall apart when January's realities come knocking.

The stress of struggling to stay disciplined and motivated while one’s pockets are dry is a major factor in why most New Year resolutions are never achieved.

For those who still insist on following through with their resolutions, the added cost of keeping up will put a strain on their finances.

Business Slowdown

January doesn’t only affect salary earners; those in the informal sector still get a slap.

With many businesses experiencing a post-holiday lull (potential customers delay spending while resetting budgets), business begins to feel dull, and buying reduces.

This could even lead to January lay-offs since most businesses hire extra staff to help with the December rush.

So, for January, businesses, workers and everyone feels the bite. And the time spent waiting for the January salary can indeed feel like 60 days.

A Solution?

But these could be mitigated by proper financial planning.

Budgeting for the days after the holidays is necessary.

Cutting down on spending and gifting during the holidays can leave some money for the days after the holidays, leaving room for January to be enjoyable and mentally shorter.

ID/AE