The overall fortunes of the UK’s over-55s have continued to improve this year with incomes and savings increasing, according to Aviva’s latest Real Retirement Report.
However, some age groups are struggling financially due to significant pressure from unsecured and secured debt.
The UK’s over-55s saw their total savings increase over the last quarter, with the typical pot rising from £14,198 (Q1 2012) to £15,756 (Q2 2012) but mainly because 65 to 74-year-olds are benefiting from the removal of the default retirement age, allowing some retirees to work longer.
In addition, this age group has typically boosted savings with a lump sum from an annuity, having chosen to save the money for later life rather than spend it.
However, the 55 to 64-year-olds surveyed and the over 75s have seen savings pots fall as they dip into their capital to boost income.
Those aged 55 to 64 have typically seen their savings drop from £11,176 (Q2 2010) to £9,373 (Q2 2012) and for the over-75s savings are down from an average £22,500 (Q2 2010) to £12,998 (Q2 2012).
At the same time, the typical amount put away each month by all over-55s has declined over the last quarter from £39.97 (Q1 2012) to £31.05 (Q2 2012).
Aviva’s research also reveals that the typical over-55 with unsecured debts owes £22,401 (Q2 2012) down from £24,827 (Q1 2012).
The fall could be the result of paying down debts that have been incurred over the Christmas period but the level of debt is still 31% higher than at the same point last year (Q2 2011 £17,112).
Those aged 65 to 74 currently owe the most (£24,707), followed by pre-retirees (£23,565), and the long-term retired (£11,811).
In addition, 17% of over-55s are still paying off a mortgage, with the typical amount owed standing at £63,555 (Q2 2012).
Clive Bolton, at retirement director of Aviva, comments: “With the average amount saved each month falling over the course of the year and the average debt held almost a third (31%) higher than at this point last year, it is clear that there are some who are still struggling with financial pressures.”
Category: Aviva News, Insurance News
