Scottish Widows: Grandparents are in mortgage debt

Mon, 13 Aug 2007

A fifth of retired homeowners are still paying off their mortgage, new research by Scottish Widows has found.

The Scottish Widows UK Pensions Report 2007 has discovered that the average pensioner owes £38,000 when they retire.

Head of pensions market development at Scottish Widows Ian Naismith remarks: "With more and more people taking out mortgages later and paying them off later, we are seeing many people turning to the equity in their home as a method of providing income in retirement."

This adds financial pressure to retirement funds, Mr Naismith comments.

Furthermore, retired homeowners owe more debt through personal loans and credit cards . The average balance of short-term loans is £5,900 according to the study, which put the national debts of retirees at £57 million.

This trend is likely to continue as homeowners aged between 50 and 59 are still a long way off finishing their mortgage repayments, with 40 per cent owing an average of £54,300.

Last week, research by Direct Line showed many over-50s are investing in antiques and memorabilia as a way of saving for the future.

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