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Running out of money = the biggest retirement fear

Running out of money = the biggest retirement fear

Category: Retirement

Updated: 11/04/2016
First Published: 08/04/2016

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 It is now over 6 months old so the content may be out of date.

Money worries can be a huge concern at any age, but it appears that those fears can be compounded during retirement, particularly given that many people won't be working to secure a regular income. As a result, the biggest financial worry for those aged 65+ is running out of money during their lifetime, with research from Independent Age highlighting the extent of the issue.

The figures show that 23% of respondents say that their biggest fear is of their savings running out, while 8% worry most about paying for help and support if they need it, with care costs being a key part of that. This comes alongside figures which show that 31% of older people have run out of money before the end of the month, so it's perhaps no wonder that so many people fear running out completely.

A lack of savings could have a lot to do with it, with 21% not having any money saved for unexpected costs. Additional figures reveal that 11% don't expect to be able to leave enough money to pay for their funeral, with 7% expecting a friend or relative to cover it. A further 25% of older people are in debt – excluding mortgages – at an average of £1,800, while 8% have debts of more than £5,000, with men tending to have more debt than women.

Take action to prevent pensioner poverty

Pensioner poverty is a growing concern, but many of those struggling could find help in the form of benefits, such as pension credit or council tax reduction – but a worrying number don't realise it. The figures show that pensioners who aren't claiming the benefits they're entitled to are, on average, missing out on £41 a week (or £2,100 a year), which could mean the difference between being able to pay for a typical dual-fuel bill and struggling to heat their home, the report noted.

In fact, in total, £3.7 billion goes unclaimed for all benefits for older people each year, perhaps unsurprising when 39% have never even checked to see if they'd be eligible for benefits, while almost half (48%) are completely unaware that they could get a 25% discount on council tax if they live alone.

Lucy Harmer, director of Services at Independent Age, commented: "These results clearly show that many older people are worrying about their finances and don't always know who to turn to for advice. Topping up your income becomes much more difficult the older you get, but bills still need to be paid. However, there is help available."

If money troubles are weighing heavily on your mind, the most important thing you can do is seek help. Heading to independent charities would be a great place to start, or if you can afford it, consider investing in professional financial advice. Make sure to check whether you're entitled to benefits, too, and always make your money go as far as possible by seeing if you can cut costs on things like utility bills or mortgage costs. You don't have to go it alone!

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.