Debt management could help prepare retirement finances

25/02/2010

Debt management
could help people approaching pension age to get their finances in shape and plan for a comfortable retirement.

Economist Dr Ros Altmann has highlighted the fact that many older people could soon be struggling to make ends meet as they fail to make allowances for the possible changes to their pensions.

Dr Altmann said: "Partly they are in denial but also partly millions of people have been lulled into a false sense of security by pension forecasts that have failed to materialise. Also, there has been a loss of confidence in pensions and a lack of understanding of the main issues."

She added that recent changes to regulations had made it "far too easy to encourage people to borrow and far too hard to encourage someone to save", which has resulted in people accruing debt and not adding to their pension pots.

Her advice follows recent research revealing that older people are not taking control of their finances.

A report from Aviva found that two-fifths of people aged 55 to 64 are not saving anything each month, and many are still struggling to pay off their mortgages and so fail to consider what money they will need in the future.

Posted by Jim Mead

Tags; Retirement Money Problems,

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