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| Over-55s forced to cut debt repayments by rising cost of food and housing | Over-55s forced to cut debt repayments by rising cost of food and housing |
| (30 days later) | |
| Rising living costs and low interest rates are causing over-55s to raid their savings and put less of their cash towards clearing debts, according to a report by pensions provider Aviva. | Rising living costs and low interest rates are causing over-55s to raid their savings and put less of their cash towards clearing debts, according to a report by pensions provider Aviva. |
| The insurer's latest Real Retirement Report, based on quarterly surveys of consumers aged over 55, highlighted the pressure of inflation on those in the runup to and post-retirement. Although the headline consumer prices index has fallen, the rising cost of food, fuel and housing means typical living costs for over-55s have risen by 3.4% since May 2012, Aviva claimed. | The insurer's latest Real Retirement Report, based on quarterly surveys of consumers aged over 55, highlighted the pressure of inflation on those in the runup to and post-retirement. Although the headline consumer prices index has fallen, the rising cost of food, fuel and housing means typical living costs for over-55s have risen by 3.4% since May 2012, Aviva claimed. |
| This, combined with falling savings rates, has forced them to cut the amount of debt they can repay each month by £23 compared with 12 months ago. The typical over-55 borrower with unsecured debt now owes £23,188, according to the report – more than a third more than in May 2011. However, there were signs that debt was becoming more concentrated, with the percentage of over-55s with debt falling from 12% to 9% over the past year. | This, combined with falling savings rates, has forced them to cut the amount of debt they can repay each month by £23 compared with 12 months ago. The typical over-55 borrower with unsecured debt now owes £23,188, according to the report – more than a third more than in May 2011. However, there were signs that debt was becoming more concentrated, with the percentage of over-55s with debt falling from 12% to 9% over the past year. |
| The report showed savings pots had fallen from a peak of £18,364 in September 2012 to an average of £11,763. The most significant change was among the 65-74 age group, where average cash reserves had halved. | The report showed savings pots had fallen from a peak of £18,364 in September 2012 to an average of £11,763. The most significant change was among the 65-74 age group, where average cash reserves had halved. |
| Clive Bolton of Aviva said: "For many people short-term borrowing is a necessary step to manage living costs, deal with unexpected expenses or treat themselves to a holiday. | Clive Bolton of Aviva said: "For many people short-term borrowing is a necessary step to manage living costs, deal with unexpected expenses or treat themselves to a holiday. |
| "But when their daily outgoings are stretched so far by the demands of basic essentials such as housing, food and travel, they can find that regular repayments are difficult to maintain." | "But when their daily outgoings are stretched so far by the demands of basic essentials such as housing, food and travel, they can find that regular repayments are difficult to maintain." |
| Top savings accounts | Top savings accounts |
| Nationwide BS | Nationwide BS |
| Yorkshire BS | Yorkshire BS |
| Coventry BS | |
| Powered by MoneySupermarket for the Guardian | Powered by MoneySupermarket for the Guardian |