A Quarter Of The Population Faces Retirement With Loan Debts
It is fairly common knowledge that the average level of debt which individuals living in the UK hold on personal loans and credit cards is the highest it has ever been and is continuing to increase.
The majority of people who are still working and have the prospect of doing so for several years to come, are often unconcerned about this problem, as they have a long enough working life ahead of them to repay any outstanding loan amounts.
But a recent survey from Just Retirement has shown that it is not only the younger generation who have debt problems. According to the figures, 24 per cent of people who are approaching retirement still have personal loan debts and many individuals are being forced to continue working beyond their anticipated retirement age, just to keep up with loan repayments each month.
The cost of basic utilities such as gas and electricity have increased by around 40 per cent over the course of this year, coupled with the fact that poor investment returns have left many people with a lower level of retirement funds than they had expected, leaving pensioners with a shortfall in the amount of disposable income they require.
Of course the other main cause of this problem is due to a lack of financial planning over the years preceding retirement. Many individuals have lost faith in pension plans and other investments over the years and have also been unable to afford to save due to maintaining additional loan repayments through excessive borrowing.
This leaves many pensioners facing the prospect of retirement still having to work for a living, or taking out an equity loan to fund retirement, or in some cases, just repay existing debts.
With almost half of retired people worried about their level of income and 12 per cent continuing to work beyond age 65, people need to start thinking about retirement long before they reach it and start putting money away throughout their working lives in order to avoid hardship in retirement.
