Tough time for over-55s

Aviva’s fifth quarterly Real Retirement Report has revealed figures showing a tough time financially for the over-55s.

Average incomes have fallen by around 4% in the last year and this age group have seen their mortgage debt rise by £10,000 each.

The number of households with savings pots of less than £500 has increased from 21% to 30%.

Looking at the average (mean) income for over-55s, this has fallen from £1,284 a month in February 2010 to £1,236 in February 2011.

It is the long-term retired who have experienced the greatest fall in average income levels over the past year, falling from £1,136 to £1,057 per month.

The combination of rising price inflation and historically low interest rates has had a big impact on cash savings for the over-55s.

There has been an increase in the percentage of people in this age group saving nothing each month. This rose from 39% in February 2010 to 43% last month.

The Aviva Real Retirement Report highlights some important concerns and financial planning considerations for the older generation, but it is important to remember that individual experiences will differ.

Most of our clients here at Informed Choice are 55 years old or older, and their experiences of the financial crisis, recession and subsequent economic environment have been less problematic than the figures in this report suggest.

By working with a professional financial planner, it is possible to avoid becoming a statistic in line with the average figures for income, savings and debt.

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