OVER 5,000 UK residents will go bankrupt between now and the end of January according to business adviser and accountant Grant Thornton.

The firm believes the early part of the New Year is likely to see record levels of personal insolvencies fuelled by more people amassing excessive debt on their credit and store cards over the Christmas period.

Richard Hawes, a partner at Grant Thornton's Cardiff office, said: "For many, Christmas shopping sprees will have a sting in the tail when credit card bills hit doormats in January.

"A little overspend will not break the bank for most. But for an increasing number of individuals - who are already financially over-stretched - the risk of plunging further down a spiral of debt to bankruptcy is real.

"An individual with serious debts will typically have a mortgage in the region of 50,000 to 100,000 and credit and store card debts of 50,000.

"While this may sound like enough deterrent for staying away from the high street altogether, we regularly see people, especially over Christmas, add to their problems in quite a substantial way.

"While January tends to be the time for New Year resolutions, many should start theirs early as reckless Christmas shopping could make the difference between becoming bankrupt or not in 2005.

Grant Thornton has monitored personal insolvencies as they have risen substantially for the last two and a half years.

"By the end of 2004, around 45,000 individuals will have been affected, a figure which represents a staggering 70% rise in yearly levels since 1995.

"The root of the problem rests squarely with excessive consumer borrowing and spending.

"A fall in housing values could also see the problem get worse as people's ability to remortgage, a practice often used to repay debts, will be reduced."