The cost-of-living crisis is driving 1 in 5 older Brits to live on credit

The cost-of-living crisis is taking a toll on people over 50 years of age as they are borrowing money to meet their daily expenses, reveals a survey conducted by Age UK.

The study revealed that 1.3 million in the over-50 age group are in direct debit or have a bill they haven't paid in the last month. One out of five people in the 50 to 69 age group had to borrow money or use credit to meet their expenses. This accounts for 3.4 million people. When it comes to people over the age of 70, one out of 12 had to borrow money to cover their monthly expenses. That's 670,000 people.

The report warns of a hard winter when millions of older people will be struggling more due to the cost-of-living crisis stemming from the energy bills.

Energy bills make people spend less on essential items

Around 70 per cent of the people surveyed said they are worried about their expenses because of the energy bills. That accounts for 10,388 people who are worried about their finances.

This upholds the findings of the national ONS statistics that showed that of the 11.3 million people in the over-50 age group, about 45 per cent of them are having a difficult time with the increasing cost of energy bills. A quarter of this 11.3 million people can't afford the £850 energy bill which is an essential expense in their life.

The ever-increasing energy bills have affected the savings of older people who are unable to purchase the many essential items they need.

The Age UK report titled 'Tackling the Cost-of-Living Crisis: What the Government must do' shows how the different age groups are faring in the current cost-of-living crisis.

The study shows how the cost of living has shot up in recent times as people have seen an increase in their expenses from previous months. Around 9 million people over 50 years of age have witnessed their expenses going up in the last month.

As a result, two out of five people over 50 years of age are spending less on essential items like food. A reported 5.8 million people in the 70 or above age group have seen an increase in their monthly expenses because of the cost of living crisis. That's about 68 per cent of the people in that age group.

Inflation affects the ability to save money for people with low-income

The cost-of-living crisis is also having a great impact on the ability to save money as 42 per cent of people over 50 years of age think they will be able to any savings in the coming 12 months. Around 49 per cent of people from the 50 to 69 age group are having a difficult time paying rent or having a mortgage because of the cost-of-living crisis. In contrast, 19 per cent of the above 70 people can't pay their rent.

These higher expenses are forcing more people into work as they put off retirement plans. The report highlights this in figures as 1.7 million people over 55 are planning to work indefinitely. This comes at a time when most managers in the UK hospitality sector have said that they are hiring more older workers as they are coming out of retirement to work in restaurants, cafes and hotels.

The report further highlights how older people are suffering more because of low fixed incomes, revealing that 450,000 of them are having an income which is 10 per cent higher than the Pension Credit threshold.

The suggested way out

The report put forward the idea of a discounted energy bill for low-income people like disabled people and unpaid carers by April of next year. It also suggests amnesty measures like monitoring the prepayment meter (PPM) of households so that they can get compensation.

Additionally, the report further brings up the notion that energy companies should be prevented from switching smart meters to PPM meters. Furthermore, the study has suggested increasing the funding for energy efficiency in these low-income households. Other propositions highlighted in the research include an improved Energy Bills Support Scheme and a better Energy Price Guarantee that ensures people don't lose out on benefits despite struggling financially.

This comes at a time when the UK government has just launched Great British Nuclear to secure the energy needs of the country in the future by reviving the nuclear energy sector.