Sharp rise in pensioner bankruptcies

07/07/2009

Retirees are struggling with their finances, as the recession continues.

Pensioners are going bankrupt in ever-rising numbers, new analysis from a leading chartered accountants has shown.

Wilkins Kennedy said that numbers had risen by 164 per cent between 2004 and 2008.

Last year, a total of 2,595 over-65s went bankrupt - with many owing large amounts of unsecured credit through both cards and personal loans.

More shocking still, pensioner bankruptcies were found by Wilkins Kennedy to have risen at twice the average rate across all age groups.

Anthony Cork, director at the firm, explained: "The property boom saw many people remortgaging their houses to withdraw cash, which has resulted in a growing number of pensioners being left with substantial mortgages.

"Pensioners may have outstanding credit card debts which were taken on during the credit boom, so they find themselves unable to meet repayments when their incomes shrink back on retirement."

EuroDebt director Kevin Still added: "Our experience is that the average level of unsecured debt for over sixties is over £24,000 and nearly half of the homeowners still have a mortgage.

"With reduced incomes it is very difficult for pensioners to manage. With the potential threat of the retirement age being extended to seventy then there is potentially a risk of pensioners becoming more indebted even later in life. We expect wider take-up of lifetime mortgages and increased use of equity release to prop up household finances."

Wilkins Kennedy used figures from the Insolvency Service for its study.

Tags; Housing Debt and Bills, Retirement Money Problems,

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