New research shows that 20% of over-50s have reduced their spending on even essentials due to their worries over the growing cost of living. The increase in inflation, the stock market collapse and low interest rates are all contributing to the money worries older people are experiencing.
Cost of living a bigger worry than health problems
The rising cost of living is now the biggest worry for over-50s, according to Saga’s quarterly quality of life index. Pensions, savings and health are all lower down on the list than the cost of living.
ONS figures show that pensioner inflation is at 6% while general inflation is only at 4.2%. Price increases in food and fuel are major causes of growing inflation. Food and energy are also the two essentials that eat into the over-50s funds the most.
Saga have based their study on a survey taken by 12,000 over-50s. The survey revealed that 68% were seriously reducing their spending and 21% were cutting down on what was felt to be an essential item.
Ros Altmann, director-general of Saga, said: “In the past people were worried that pensioners had a choice between cutting back on heating or eating, but these figures are showing that they are doing both now.”
Altmann, said: “It seems those in their 50s are faring even worse than the older groups, suffering faster income falls and rising long-term unemployment.
“These are issues that government must not ignore. Rising prices, low interest rates and an ageist jobs market could leave a generation of fifty-somethings on the scrapheap. What a waste of resources.”
She continued by saying that “Anyone coming up for retirement has had a really serious setback – not only have stock market falls reduced the value of their pensions, but the cost of buying an annuity has risen. It is much more expensive to buy your pension this week than it was the week before last.”
She then added that the economy would suffer as a result of these cuts as well as the over-50s directly affected as the cuts mean less money is being pumped into the economy to encourage growth and create job opportunities.