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Mortgage debt plagues Britain's pensioners
13 June 2008 11:30
Many people are entering retirement having not yet paid off their mortgages, a new study has warned, with repayments badly eating into their incomes as a result.
One in three over-55s still had mortgage debt last year, Key Retirement Solution's figures showed, with these older Britons owing £37,316 on average, up by 20 per cent from 2006 and working out as a typical monthly repayment of £218.
Given that data from Credit Action indicates that half of all single pensioners have a total income of less than £6,000 a year, this could potentially leave this group with just £282 to spend on council tax, utilities, food, clothing and other expenses each month.
Worryingly, the situation is especially difficult for older pensioners, as nearly one in three over-70s still owed money on their mortgages in 2007, with this debt having risen by 23 per cent year-on-year to an average of £45,493.
Key Retirement Solutions' Dean Mirfin warned that many retirees are remortgaging rather than downsizing and that, with the cost of living continuing to rise, people entering retirement must be aware of the impact that debt can have on their finances.
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