Credit card debt among pensioners on the rise, new data says

Recent reports have indicated that amongst pensioners’ credit card related debt has been increasing on an exponential rate, which has resulted with over £1 billion in unsecured credit card debt.

The bad debt has recently combined with inflation rates that have been above target for months, which have been steadily eroding the value of pensioners’ savings accounts and resulting in an increased incidence of financial problems amongst the country’s retired citizens.

Recently released figures by market research firm Gfk NOP demonstrated that a collective fortune was being spent on credit card fees monthly by pensioners, with spending rates up by 20 per cent since January 2010.  This past June, pensioners spent £354 on average across each credit card they carried, a figure not seen since the worst days of the global financial crisis in October of 2008.

The total debt currently outstanding amongst pensioners in regards to credit cards has risen from £900 million at the beginning of the year to its current high of £1.1 billion, brought about in no small part due to a drop in interest rates on their savings accounts in conjunction with the rising cost of living.  Many pensioners have had little recourse but to use their credit cards in order to make ends meet for essentials, thus exacerbating the problem further amongst those of retirement age and older. Many pensioners are additionally still repaying loans and other finance, with a recently conducted survey finding that 20 per cent of the over-55 crowd still repaying their current mortgage.

Consumer advocacy group Credit Action’s spokesperson, Joanna Parsley, stated that the amount of debt that older British citizens has been growing, leaving them in not only a very vulnerable position but in a quite frightening one as well.  Mr Parsley also said that this vulnerability is only compounded by the devastation these pensioners’ savings have undergone, which had been relied on to provide income during their retirement years.

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