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Over 55s - One in 10 Pensioners
Have Outstanding Debts

According to research carried out by Age UK, the rising cost of fuel, food and other outgoings is responsible for nearly half of the UK's older citizens having to struggle to make ends meet.


The survey of 1,200 people over the age of 60 has shown that one in ten have outstanding debts such as a mortgage, credit card debt or bank loan. Many of the debts accumulated are thought to be as a direct result of rising costs and retirees finding it difficult to manage on the income they receive. Separate research from Prudential shows that a third of people retiring this year will be living below the poverty line.


One way to boost income for those who are retired, or planning to retire, is to check that they are claiming all of the benefits they are entitled to receive. Pension Credit is one benefit that can often be overlooked as many people do not realise they are eligible to claim it.


There are two types of Pension Credit - Guarantee Credit and Savings Credit. Guarantee Credit applies to those who have reached the minimum qualifying age (which is gradually rising from 60 to 65 and then later to 66, 67 and 68); Savings Credit applies to those aged 65 and over.


Guarantee Credit is payable if weekly income is below a certain amount, and it can be applied for by those who have reached the minimum qualifying age even if their spouse or partner has not. Savings Credit can be paid with Guarantee Credit or on its own. It is payable to those who have made some provision towards retirement by saving, or who have a second pension, and who receive a weekly income below a certain amount.


A Pension Credit calculator is available online to help determine whether Pension Credit might be payable. It is possible to apply for Pension Credit by telephone and all that is needed is a National Insurance number, information about savings, investments and income, and bank account details. An adviser will help with the application. Alternatively, an application form can be completed and sent in the post for those who prefer to apply in writing.


For people who have accumulated debts and have concerns about how they will be repaid, debt counselling might be helpful as it will allow them to discuss alternative debt solutions. These could include measures such as debt consolidation or other debt management techniques. Debt consolidation involves taking out a single loan to repay existing debts that might be owed to various creditors. One benefit of this method of debt management is that creditors will no longer be chasing payments and future payments will be made to one source. The monthly repayment is intended to be affordable so that it can be maintained until the loan is repaid.


Other debt solutions are available such as Individual Voluntary Arrangements (IVA), which could reduce the amount owed. These are available to some people who are in serious debt that they are unlikely to ever be able to repay. It is important to research the options available to see which method is best for an individual's own circumstances.


At Debt Advice Group we have specialist waiting to help assist you with any queries ranging from personal bankruptcy to CCJ's. Please do not hesitate to get in touch.




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