Hard-hit pensioners use savings to repay debts
Wednesday 11 July 2012 by Tony Patey, Industrial Reporter
Pensioners clobbered by inflation and low interest rates are dipping into their hard-won savings and could even see them run out, campaigners warned today.
Insurance firm Aviva confirmed in a new report what pensioners have been warning for ages under the Con-Dem government – long-time retired people are being pinched hard.
Savings for over-75s have almost halved in two years. In summer 2010 they had an average of £22,500 put aside but that has now shrunk to £12,998.
Aviva’s latest Real Retirement report also highlighted a “concerning” finding that a quarter of people over 75 have a credit-card debt they do not repay in full on a monthly basis.
That’s despite the fact they are likely to have retired a decade earlier.
The typical person with credit-card debt owes 128 per cent of their monthly income with £1,689 outstanding, the report found.
National Association of Pension Funds chief Joanne Segars said: “Many of those deep into their retirement are having to knock lumps out of their nest egg to get by.
“Many could see their savings run out.
“The UK is sleepwalking into a crisis when it comes to its old age. We have to get more people saving into a workplace pension from as early as possible, and a simpler, more generous state pension will also help.”
Meanwhile, the public spending watchdog said there is “insufficient accountability” to see how well some pension schemes are being protected.
The National Audit Office highlighted a lack of a “joined-up approach” between regulators, the Department for Work and Pensions, the Financial Services Authority and the Treasury.