Over 55’s in the UK have endured a tough 12 months according to data gathered from Aviva. Of the people they questioned in this age group, average incomes fell by 4%, while inflation in the economy has remained high, well above the governments own target of 2%. Whilst younger workers can sometimes take measures to mitigate against falling income, such as working overtime, over 55’s and particularly retirees are more often than not on fixed incomes.
As well as falling income levels, mortgage debt has increased by £10,000, with the number of homes with saving pots of less than £500 increasing from 21% to 31%. Rising prices mean that more people are having to spend more of their income on necessities such as food and petrol. Food prices have in fact risen by a whopping 5.88% from February 2010 to February 2011 according to the report, which has lead many over 55’s to cut back on the amount of food they buy. There is also very little incentive to save either, as interest rates have remained very low, with the Bank of England base rate being just 0.5%.