10 June 2008 / by Rebecca Sargent
Brits aged 55 and older are the worst hit by the credit crisis so far, according to new research from Skipton Building Society.
The series of research, entitled Credit Crunch Britain, looks at the affects the credit crunch is having on Britain and its attitude to finances. The first report released from the series reveals that eight out of 10 over 55s questioned have cut back on their outgoings as a direct result of the credit crunch.
The research cites increased mortgage and rent payments and a sharp rise in the cost of utilities as the main reasons for the tightening of purse strings among the over 55s. The research found that, although pensioners were the worst hit, no age group was immune to the affects, as more than two thirds of all adults aged 16 and older confessed to cutting back on spending.
Managing director at Skipton Building Society, Steve Haggerty, said: “It is clear that the credit crunch is having a marked impact on UK consumers’ spending. It is our view that the credit crunch will ease in the short-term; making mortgages cheaper and more available.
“However, the wider, global issues, such as oil prices, will continue to create pressures on the pockets of UK consumers for some time to come.” He added.
And it appears things are set to get worse for pensioners, as new research from financial services company Edward Jones has revealed that 43 per cent of working adults are saving less and less towards their retirement in a pension or savings account as a result of the rising cost of living.
Andrew James, retirement planning manager at Edward Jones, said: “It’s a big concern that the research shows people of all ages and social classes are cutting back saving for retirement in order to pay for essentials. If this trend continues then we are just storing up even more problems for the future.
“Those in their late 40s and 50s really do not have the time to make up for any missed contributions so we believe it’s vital for their long term futures that they keep saving. It is imperative the government, and all those involved in the pensions industry do all they can to keep driving the message home that people must continue to make provisions for their retirement.” He added.
He concluded: “We would like to see clearer guidelines on pension rules to allow the industry time to talk to people about saving for the long-term, and helping to educate individuals in the UK about tax efficient saving for retirement can be – and the earlier people start the easier it will be.”
©Fair Investment Company Ltd