Nearly one in five new retirees owe money
25 January 2012 15:49:12
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| Many retirees have outstanding credit card debts. |
Average retiree will have debts of £38,200
Prudential's latest retirement research indicates that 18% of those planning to leave the workforce this year will do so with debts hanging over them. The 'Class of 2012' research - which questioned 1,003 people retiring in 2012 - found that debtor retirees typically owe £38,200, with repayments amounting to approximately £260 per month. This means that, on average, people retiring with outstanding debts will spend almost a fifth of their expected £1,290-a-month income on debt repayments.
Mortgages and credit cards form bulk of debt
Researchers found that just over half (51%) of new retirees with debts owe money on credit cards, while a similar proportion have outstanding home loans. Nearly one in 10 respondents say they never expect to pay off their debts in full, while the average person hopes to complete their repayments in just under four years' time.
New retirees urged to seek advice
Vince Smith-Hughes, Prudential's retirement income expert, urged people with outstanding debts to seek professional advice. He claimed: "With a manageable repayment programme in place, debts need not become an issue for this year's retirees - and there is plenty of help available through the Money Advice Service and Citizens Advice Bureau." The expert also advised those who are still working to save as much money as possible and consult a financial adviser for help with their retirement planning.
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