New research from Key Later Life Finance suggests that one in four older Britons believe there is nothing they can do to boost income in retirement if the cost of living crisis continues. Earlier today, the Consumer Price Index (CPI) rate of inflation increased to 11.1 percent, which is the highest level since 1981. With the ongoing energy crisis and Putin’s illegal invasion of Ukraine, experts believe inflation will continue to be high for the foreseeable future which is causing over-55s to review their finances in an attempt to save money.
A survey conducted by Key Later Life Finance found that 58 percent of over-55s are planning on cutting back on heating.
On top of this, around 58 percent of the same age demographic are switching lights off around the house to save money.
The firm noted that over-55s spend more of their income on food and utilities which means they are more likely to be detrimentally impacted by inflation pushing prices up.
Notably, food price inflation has skyrocketed to a 45-year high of 16.2 percent for October 2022.
Some 86 percent of over-55s say they are making changes to their life in order to accommodate the country’s ongoing inflation issue.
Those who have reached retirement age are also reducing their heating, with 60 percent of pensioners doing this and switching off lights.
Pensioners were found to be reluctant to go out less at 43 percent, according to the Key Later Life Finance poll.
It is believed this is because this group arguably have less social interaction than those in employment.
Will Hale, the CEO at Key Later Life Finance, shared why many older Britons are ill prepared for the true impact of inflation.
Mr Hale explained: “Most people in the UK are not only fully aware of the impact of the cost-of-living crisis but choosing to make economies where possible to either make their money go further or boost their financial security.
“Over-55s are no different but with more of their expenditure going on food and utilities, they are particularly vulnerable to the price increases we’ve seen.
“With inflation rising, even the 39 percent who say they have factored inflation into their retirement planning are likely to be feeling the pressure.
“With over-65s currently sitting on £2.95trillion worth of unmortgaged equity there is no doubt that property can play a role to help older people to maintain their standard of living in these challenging times or indeed to assist younger family members who are likely also to be feeling the pinch.
“The best way to start is to speak to a specialist financial adviser who has in-depth knowledge of the market and the different products available as well as other options that might be considered.
“Some may find downsizing works while others may want the flexibilities and protections offered by equity release or find that they are entitled to claim benefits they were not aware of.
“It is about finding the right option for their individual circumstances taking into account both immediate needs and long-term implications.”