More people are entering retirement with mortgage and credit card debts

27th January 2012 by RetireEasy

Almost one in five of those planning to retire this year will do so with outstanding debts, according to a Prudential report issued today. Its report showed the average amount owed by people retiring in 2012 will be £38,200 – up from £33,100 in 2011. At least 50% of these retirees will owe money on their home loan and/or will still have outstanding credit card balances.

Prudential’s Class of 2012 research also revealed that people who are due to retire in 2012 are expected to have a lower retirement income than people who retired in the previous 5 years.

Vince Smith-Hughes, Prudential’s retirement income expert, said: “With a manageable repayment programme in place, debts need not become an issue for this year’s retirees – and there is plenty of help available through the Money Advice Service and Citizens Advice Bureau.

“Retiring with outstanding debts could be a sign of a lack of financial planning. It is important therefore for those still at work to save as much as possible as early as possible, and to consult a financial adviser to help them plan for a comfortable retirement.”

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