Brits set to retire with £66bn of debt

Over one in three over 55s are heading into retirement with a combined debt of £66 billion, according to a study.

On average, this works out at £11,106 per head, a report from equity release firm Key Retirement Solutions has found.

The analysis, based on 4,507 people in the UK aged 55 and over who released equity in their home with Key Retirement Solutions in 2007, reveals almost one in four have outstanding loan payments owing £8,766 and a fifth have outstanding card debts owing £8,358.

Dean Mirfin, business development director at Key Retirement Solutions, said: "As the cost of living is on the up, these figures, even if they are only part reflective of pensioners as a whole, are of real concern.

"Retirement should be a time to enjoy yourself after all those years of hard work, yet one in 20 people in their 60s, 70s and 80s admit to constantly struggling to keep up with financial commitments or having fallen into arrears."

In addition, retirees are hit with higher inflation, a study from Alliance Trust shows.

The over 75s saw their inflation rate surge from 5.4 per cent to 6.3 per cent in July – this is 43 per cent higher than the official rate of 4.4 per cent.

Older people are seeing higher inflation rates because they spend more of their budget on energy bills, which are rising rapidly, and less on discretionary items such as clothing, where prices trend downwards.