Retired households need debt management advice to find extra £429 extra a year

The average retired UK households, especially those between the age group of 65 and 74, should immediately seek debt management advisers to find the extra £429 a year to maintain the standard of living they enjoyed 12 months ago.

This was the recommendation made by MGM Advantage, the retirement income specialist. According to the firm, a household where the main occupant is aged 75 and over needs an additional £225 to cover the cost of living.

MGM Advantage sales and marketing director Aston Goodey said, “Many retired people have had to endure a rise in their cost of living.  This, coupled with the fact that people are generally living longer is placing considerable pressure on retirement income.  All the more reason therefore to shop around for the best annuity, and seek financial advice to ensure you achieve the best possible income in retirement.”

MGM said that the cost of living for the average home has risen by £670 or 1.85% over the last 12 months.  These figures are based on how different households spend their annual budgets and changes to the cost of goods and services between October 2008 and November 2009.

“If you are entitled to an enhanced annuity for example, our research shows that, depending on your medical condition, you could on average achieve around 22% more income,” Goodey said.

It was estimated that over the past 12 months, the three main areas which saw the biggest increase in cost include transportation (a rise of 6.9%), household goods and services (a rise of 3.5%) and recreation and culture (a rise of 2%).

MGM Advantage estimates that the annual household expenditure for a home where the main occupant is aged 65 – 74 is around £23,107, compared to £14,926 for a household where they are aged 75 and over, and £36,889 for the average home.