Older people are at just as much risk with debt as younger age groups, according to a recent study.
Findings by Age-UK and the International Longevity Centre found that retired Brits have fewer opportunities to pay off their debt as their incomes shrink; and it was revealed that debt problems are fuelling divorce among many elderly couples.
Senior couples that struggle with finances are more than twice as likely to suffer marital breakdown, than those who stay in control of their monies.
Michelle Mitchell, of Age UK, said: “There is a small group of older people who are facing the nightmare of increasingly serious debt problems.
“While it is good news that overall debt among the older population is falling, this research, supported by evidence from other charities, sends a clear warning that funding for debt and money advice for older people must be protected and expanded.”
The charity claims that retired people’s budgets are being squeezed by poor returns on savings and high energy prices; and they issued a stark warning that more debt advice is needed for the older generation.
They warn that the options for paying off unsecured debts get smaller as people grow older and have fewer possibilities to earn money.
Further findings include:
There is a statistically significant decrease in quality of life for those whose debts get out of control.
In 2010, 28% of Brits over 50-years-old with debts were finding it difficult to pay them off. This is an increase from 23% in 2002.
From 2002-2010, the proportion of over-50s with problem debts fell from 6.5% to 5.9%. Overall debt levels also dropped with the number of over-50s reporting ‘no debt at all’ surging from 57.8% to 67.6%.
However, while the proportion of older people with debts has fallen over time, the amount of money owed has increased substantially in the eight-year period.
In 2010, 10% of older people with unsecured debts were paying over £85 a week to service their debt.
Owner-occupiers with a mortgage are five times as likely to have debt woes as those without a mortgage.
The spokesperson added: “Debt advisors need to understand the specific needs of older people often living on low fixed incomes and particular attention must be paid to those moving into self-employment or who have recently become unemployed.”
Age UK is a charity that plays a constructive role in debates around ageing and older people’s issues, concentrating on the voices of disadvantaged and vulnerable older people.
The International Longevity Centre – UK (ILC-UK) is an independent, research led, think-tank that addresses issues of longevity, ageing and demographic change.
AgeUK Information and Advice Service added: “We are experiencing many more cases involving older persons in debt – ranging from £1,000 to £200,000 – some relate to energy or water bills, rent or mortgage arrears, and payday loans. Debts are often caused because older people initially feel confident in paying back loan agreements but then suffer ill health in later life.”
This article was written by Ian Chase on behalf of Solvemydebt.co.uk, the leading specialists in debt management, IVA and bankruptcy advice. Take positive action today against problem debt and visit the site for expert help.