Badly performing final salary pension funds, this week’s Government decision to cut tax relief on pension savings, and the prospect of frozen public sector pensions for the foreseeable future all add up to a bleak winter for the UK’s older population, warns Payplan.
The national free debt solution provider is warning pensioners those people shortly facing retirement to take stock of their situation and plan ahead – otherwise debt could become an increasingly worrying scenario for this growing age group.
“The over 50s are the fastest growing age group and have the biggest debts according to our latest figures. This immediately throws up a red alert for us – it’s a situation we can’t brush under the carpet,” says John Fairhurst, Payplan MD.
Payplan works pro-actively with individuals to plan for financial hardship, looking at ways to avoid and manage old age debt and money issues.
Its qualified debt consultants have seen a significant rise in calls from people aged 55 and over in the last quarter who have pension debt worries.
“The concerns over Government changes to pension income has started to worry retirees who have already been seriously hit by a final salary pensions fund which has fallen drastically below their expected return,” adds Mr Fairhurst.
“The situation is worsened for 200,000 UK pensioners living in private retirement property, who according to AgeUK, are being burdened with spiraling service charges and unfair fees.”
Prospects for this sector are unlikely to improve says Payplan with the Government proposing extensions to the retirement age which could see people working well into their late 60s and beyond.
“For many people in this age group, work will be a necessary option to help stave off debt,” admits Mr Fairhurst. “Retirement will become a luxury enjoyed by the more wealthy, rather than an automatic right for us all.”
Payplan works closely with other free and impartial agencies to ensure pensioners, like other age groups with financial worries, are fully aware of their entitlements and have the right advice to guide them through retirement pension and retirement planning.
For free and impartial advice on money planning contact one of the following: Payplan: http://www.payplan.com - 0800 280 2816; the Citizens Advice Bureau: http://www.citizensadvice.org.uk/getadvice.htm - to find your local CAB branch; or the National Debtline: http://www.nationaldebtline.co.uk/ - 0808 808 4000.
Note to editors
AgeUK’s report called Putting Retirement Housing in Order was published Sept 14, 2010 and calls for the Government to start regulating the industry. For more details: http://www.ace.org.uk/
The Government announced on Oct 14 it would cut tax relief on pension savings for around 100,000 high earners to help reduce the country’s record budget deficit http://www.reuters.com/article/idUSLNE69D03520101014