Debt burden of retirees 'growing'

The debt burden of retired people in the UK is growing with a third in the red on loans and credit cards, according to a poll by Scottish Widows.

Retirees with outstanding non-mortgage debt owed an average of £7,344, up from £6,732 in the same poll a year ago.

Some 15% of retired people were also still paying off a home loan, with an average debt of £50,100, up £8,000.

Some grown-up children are still financially reliant on their older parents, the poll also found.
It suggested that 7% of retirees were still paying towards the upkeep of the children who have reached adulthood.

'Alarming'
"The situation for retirees in debt is not getting any better, and an increase of £8,000 in the average amount of mortgage debt is alarming," said Ian Naismith, head of pensions market development at Scottish Widows.

"The recession has seemingly done nothing to encourage retirees to cut their debt, and with the possibility of the value of their property dwindling, they could be leaving themselves in a vulnerable position.

"Those in retirement should be able to enjoy life and not worry about the financial burden of debt, as well as their retirement income."

Those approaching retirement were also saddled with debt, Scottish Widows found, with 43% still paying off a mortgage. The average outstanding mortgage debt had fallen in a year, however, down from £58,300 to £57,000.

The poll surveyed 5,007 people, although fewer than 1,000 in the survey were retired homeowners.