Debt Solutions for Over 55s

Several recent research studies outline the growing financial worries facing individuals over the age of 55. Research published by Prudential states that more than one in five people retiring in 2011 in the UK will retire in debt. The average debt of these retirees will be £33,100. For one in 20 people, personal debt levels will be in excess of £50,000. Around half of the over 55s retiring in debt will do so with unsecured debt arising from credit card use, while the other half will do so with mortgage debt.

Personal debt has risen over the last ten years for all demographics in the United Kingdom. Prior to the start of the current recession, this was driven by the ever wider availability of cheap credit. People chose larger mortgages, broader credit card usage and bank or other loans to pay for their household expenditures and leisure activities. In addition, the economy has undergone a drastic reversal since the current financial crisis began in 2007. Living costs have generally increased, wages have often remained lower in comparison and loan arrangements have become more stringent.

Research published by Aviva paints a stark picture for many over 55 year olds. There is a very real possibility that many pensioners will never be out of debt. Aviva’s research states that nearly a quarter of all over 55s will not have paid off their debts by the time they reach 75 years of age. The main reason for this continued state of indebtedness is the rising cost of living and the loss of income that comes with retiring. Pension payments are at an historic low point for many. Property values are also generally weaker than was the case previously, reducing the size of the capital held by many homeowners.

Experiencing debt and the prospect of remaining in debt beyond the age of retirement can lead to anxiety and feelings of guilt. It can conjure up images of visiting bailiffs. Phoning a debt line can help you put your debts and future prospects in a better perspective. The Debt Advice Group has specialist advisers and counsellors who can look at your situation and suggest the best way forward.

Debt solutions for over 55s can include Debt Management Plans, IVAs (Individual Voluntary Arrangements) and, as a last resort, bankruptcy. Being declared bankrupt is certainly the most radical of the potential debt solutions, and has long lasting consequences. Being declared bankrupt means it becomes harder to apply for credit in the future. For over 55s, taking out further loans may be one of the only ways in which to pay for their future. It may become necessary to continue working beyond retirement age, although there is not always work available for this demographic.

Debt consolidation entails taking out a debt consolidation loan that is used to pay your debts from a single source. The advantages of this method of servicing your debts is that it has a lesser impact on your credit rating, meaning you are more likely to be able to borrow money in the future if needed.



The Debt Advice Group has been created to help people in serious debt get good, honest, specialist advice. It is an organisation having specialist providing debt help and debt advice to Get out of debt.