Retirees may need debt consolidation

Retirees may have to cut back on their lifestyle choices as they struggle financially, it has been discovered.

According to MGM Advantage, 4.5 million people who have given up working have had to scale back on their spending, while 601,000 individuals who gave up their jobs have returned to some form of work. It means consumers may have to seek debt consolidation methods if they wish to get their finances under control again.

The study has found there are major discrepancies between the expectations of how lifestyles will be for those who are of pensionable age and the reality. A total of 57 per cent of those questioned said they think they will take more holidays when they give up their job, but in reality almost 33 per cent have had less.

Those who are looking to get debt free have been left in the situation whereby they have to curtail their spending, as they cannot afford some of the luxuries they were expecting to. The report added the over-65s is the age group most likely to cut back on the use of utilities such as gas and electric because of the cost of them.

Craig Fazzini-Jones, director at the organisation, noted there are too many “unrealistic expectations” surrounding retirement at the minute. He added more people need to realise they will face “a worse standard of living and difficult financial decisions”. The specialist observed: “You cannot start preparing for retirement too soon, whether that means paying into a pension, building a pot of savings or talking to a professional for advice.”

His comments come after Andrew Hagger, a spokesman for Moneynet.co.uk, recently stated it is important couples know the financial standing of each other. He added without this information, it can be much harder for people to plan effectively for the future.

By James Francis