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Westcountry Retirees Finding Themselves In Big Debt

by Jim ONeil on September 27, 2011

in Personal Finance News

The Consumer Credit Counseling Service (CCCS) reported receiving 634 calls in 2010 from desperate Cornwall and Devon retirees. Some people over 55 are facing debts exceeding £28,000 during what are supposed to be their golden years. They contact CCCS seeking financial advice for handling their loans, credit cards, and other forms of unsecured debt.

According to CCCS, increases in electric and gas prices have made finances tighter for older people. Company representative Matt Hartley reported that since 2008, clients have experienced an average 10.6 percent increase in electricity and gas bills combined.

With their household budgets restricted, these individuals are having a difficult time repaying credit card and loans debt.

Rachel Johnstone with Age UK Devon stated that nearly half of older people report they are merely “getting by” financially and one in ten say they are having difficulties or are struggling. CCCS revealed that retirees who own homes are using the equity in their properties to lessen the pressure.

Within the past 12 months, its free equity release advice program has released £29,983 worth of capital.

Equity release can be a debt solution but should only be used as a component of a long-term plan for retirement, said Tom Moloney, equity release manager with CCCS. The agency expects more homeowners to turn to property equity for debt repayment in upcoming months.

Many of them may be from Torquay, which had the highest localized debt amounts of all over-55 CCCS client locales.

As winter nears and the need for home heating arises, the situation for these retirees will only worsen. Ms. Johnstone stated that many older people may be forced to cut back on home heating in order to make ends meet.

These individuals should explore the annual winter fuel payment of at least £200 available to people over age 60.

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