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Report lays retirees’ struggles bare

Report lays retirees’ struggles bare

Category: Annuities

Updated: 21/09/2011
First Published: 21/09/2011

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Retirees have seen their incomes fall, savings drop and debts rise as they struggle to meet the rising cost of living, worrying new research has revealed.

According to Aviva's latest Real Retirement Report, the typical monthly income received by those over 55 in the UK has fallen to £1,216, down from £1,294 three months earlier.

The over-75s were revealed to have the lowest monthly income (£999), followed by those aged 55 - 64 (£1,230) and those aged 65-74 (£1,314).

Almost a quarter of over-55s now survive on less than £750 per month.

With incomes dwindling, the report also suggests that retirees are dipping into their savings to get by.

Those over 55 have seen their savings fall by 12% over the last quarter to £10,468, while a quarter have less than £500 in reserve.

At the same time, debts are also on the rise, with those over 55 who owe money typically owing £20,001 at present, up from £17,112 in May.

Clive Bolton, 'at retirement' director at Aviva, said the over-55s have seen their finances deteriorate over the last quarter as people struggle to keep up with the rising cost of living on a relatively fixed income.

"That almost a quarter of this age group have less than £500 in savings and 40% save nothing each month is a clear indication that this age group is struggling financially," he added.

"While there is a limited amount that the long-term retired can do to improve their finances, these figures highlight the importance of a lifetime approach to retirement planning.

"Taking out a private pension, building up a respectable savings pot and paying down debt are all simple steps that people can take to ensure they don't face these problems in retirement."

If you're nearing retirement, the new Moneyfacts Annuities Service offers all the help you could ever need to make the most of the pension funds you have built up.

Annuities from different providers can be compared, while people who smoke or have health issues can take advantage of an enhanced annuity.

The whole process can be completed online, but if you get stuck at any point or have a question that needs answering, an expert is ready and waiting to give you a call.

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Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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