Older people form a major piece of the retail sales puzzle, with their finances comprised mainly of food and energy (Electricity, Gas, water). As pension inflation has increased 6%, along with falling stock market rates and interest rates getting lower by the day, this section of the society has been observed to reduce their expenditure on essential living necessities. This is resulting in fall of quality of life for these individuals.
Inflation and Cutbacks
In today’s time, as major expenditure comprises of energy and food for people above 50,s, Rising prices in these areas has developed a concern as this has been major reason for increasing inflation.
Research done on approximately 12,000 over 50,s, by Saga, deduced that 68% handled rising inflation by cutting back the luxurious spending. However, the factors of worry lies in 21%, who have stated to cut back their expenditure for Items required for daily consumption and are absolutely necessary, like heating consumption and food. This is seen rising steadily for past few months.
Ros Altmann, director-general of Saga, infers that these cut backs in recent months affect not only the quality of life of these older generations, but they also stop the money from going back into the market. This means pension cuts are helping to stagnate the economy instead of pushing the economy to drive growth and create jobs.
Point of no return
As people come closer to their retirement, they become more cautious and try to postpone their retirement or try to increase their hours as much as possible.
The number of unemployed 50 – 64 year olds has risen to the point of serious concern, especially for women whose number rose to 9.5%.
Ros Altmann further pointed out: “It seems those in their 50s are faring even worse than the older groups, suffering faster income falls and rising long-term unemployment.”
“According to research, while stock market has reduced the value of pensions and Rise in annuity prices,” Altmann continued.
“That means it is getting more and more expensive to buy pension as days go by. Our Pension enquiry form will help solve the queries and lend a helping hand in making pensions a smoother transition.”