One in three re­tires with £17,000 of debts

Daily Express - - News - By Sarah O’Grady So­cial Af­fairs Cor­re­spon­dent

ONE in three work­ers re­tir­ing this year will have more than £17,000 of debt hang­ing over him or her.

As many as 231,000 peo­ple will still owe £17,460 on credit cards, loans and mort­gages af­ter they have re­ceived their last pay cheque.

Pay­ing back the money will typ­i­cally take three-and-a-half years but it will take nine years or more for one in eight peo­ple.

How­ever, more than a third ex­pect to die in debt, ac­cord­ing to an anal­y­sis of the Re­tire­ment Class of 2020 fi­nan­cial study.

Strug­gling

Of those aged 55 and over who are still in debt, 48 per cent owe money on credit cards, 31 per cent have an out­stand­ing bank loan and 14 per cent still have a mort­gage.

Eight per cent owe more than £20,000 while four per cent do not know how much debt they are in.

Dawn Sto­bart, of the char­ity Chris­tians Against Poverty, said pen­sion­ers strug­gling with debt make up six per cent of their client base.

She said: “Like all other debt ad­vice or­gan­i­sa­tions we’re see­ing an in­crease year-on-year of peo­ple strug­gling with pub­lic sec­tor and util­ity debt. Peo­ple are bor­row­ing to live.”

Some peo­ple re­tire with debt due to last minute un­planned ex­penses but 34 per cent of work­ers only start to make def­i­nite plans 12 months be­fore they are due to draw their pen­sion – which is too short a time to clear bor­row­ings, ex­perts say. Peo­ple re­tir­ing in Wales are the most likely to have debts – 48 per cent – but the aver­age amount they owe is among the low­est in the UK at £11,180.

The big­gest aver­age debts are owed in the North-east at £22,900 and in the South-east at £22,400 with peo­ple re­tir­ing in York­shire and Hum­ber­side ow­ing the least – at £9,000.

Those in the North-west also have lower than aver­age debts, at £10,100.

Will Hale, of eq­uity re­lease spe­cial­ists Key, said: “Even those with gen­er­ous in­comes may find pay­ing back an aver­age of £17,000-plus a stretch at a time when they should be en­joy­ing an ac­tive re­tire­ment and wor­ry­ing less.”

Dawn Sto­bart has seen a rise in debt

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