One in three pensioners has debt, with an average of £17,000

A third of retirees have debts to pay, according to a study, with each person owing an average of £17,000.

This means around 3.3 million pensioners are in debt, with a combined outstanding balance of £58 billion.

That could include credit cards, loans, car finance and increasingly mortgages, as rising costs mean an increasing number of people cannot pay off their home loan before they retire.

According to the survey by life insurance company SunLife, these retirees spend an average of £602 a month to pay off their debts.

That equates to £7,226 a year, or about a quarter of the average annual household income of retirees aged over 50.

Up to half a million, or five per cent, of retirees have yet to pay off their mortgage, with the average mortgage debt rising to £63,644 per person.

However, by far the most common type of debt among retirees is credit card debt, with a quarter (25 per cent) of people owing an average of £3,566. The average monthly payment is £408.

Mark Screeton, chief executive of SunLife, said: “While inflation may have fallen from 6.7 per cent this time last year to 2.2 per cent, the cost of living – including the rising cost of debt – continues to have a huge impact on the economy.” Personal finances of retirees.’

Personal loans and car finance accounted for six and eight per cent of loans among retirees respectively, with retirees aged over 50 owing an average of £6,918 on personal loans and £12,582 on car finance.

About 72 percent of retirees own their homes outright.

On average, retirees bought their home 24 years ago, during which time its value will have increased by 317 percent.

This allows them to possibly use the equity release to pay off their debts, although this should be treated with caution as the interest charged accumulates over time and can end up being substantial.

Allows homeowners age 55 and older to tap into the value of their home in retirement by taking out a loan repayable upon the sale of their home after their death.

There is no need to make monthly payments, but releasing equity leaves less of an inheritance for your loved ones, so it may be worth looking at alternative ways to increase income, such as moving to a smaller home to free up cash. .

Screeton said: “Of course, equity release is not suitable for everyone, so it is best to speak to a financial adviser to find out more about the options available to you and your specific circumstances.”