Experts fear the debt bombshell could get far worse with some failing to put enough aside for retirement or to pay off debts and mortgages, while others are increasingly being called upon to support younger family members.
UK consumers remain among the most indebted in the world and figures obtained by the Yorkshire Post from debt charity StepChange show that during 2013 the average person over 60 who contacted it for help in Yorkshire owed £15,635 on credit cards, loans and other unsecured debts.
In the York postcode area that includes Escrick and Riccall, the charity saw average unsecured debts of £60,738, while in one district in the Scarborough area the over-60s owed £47,408 on average. In the Goole and Howden postcode area the average was £34,666.
Ros Altmann, Tony Blair’s former pensions adviser, said: “Those who have not put money aside for their retirement will be most likely to struggle with debts and financial planning for later life needs to start much earlier.
“Many people adopt the ‘ostrich approach’ to financial planning, not thinking about it and hoping if they don’t engage with the issue it will somehow all be OK.”
StepChange says it has seen a “significant increase” in the level of debt amongst the over-60s, with 36 per cent more people in the age group contacting it for debt advice than in 2009. It says total debt owed by the over-60s amounts to more than a quarter of a billion pounds.
A spokeswoman for the charity said: “Crucially, we have seen a 50 per cent increase in people over the age of 60 who still have financially dependent children contacting the charity over the last five years. As earning potential diminishes with age, we have a real concern that problem debt will become more common amongst the over-60s.”
Research by Prudential found 14 per cent of retirees are providing their families with help for everyday living costs, such as food or travel, while 11 per cent hand over money for luxury items such as holidays, new cars or TVs.
It found 31 per cent of those in Yorkshire and the Humber planning to retire in 2014 were still supporting grandchildren and children. The average retiree was supporting two people to the tune of £3,000 a year.
While an increase would be a welcome boost for savers hammered by poor returns, experts fear many mortgage holders may be ill-prepared for a rise.
Stan Russell, retirement income expert at Prudential, said: “Our research shows that retirement doesn’t necessarily mean an end to family financial commitments. Giving a financial helping hand to family is very important, but people retiring this year are risking their own standard of living with the levels of support they provide.”