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UK Pensioners Living Below Poverty Line
Michelle Mitchell, charity director at Age UK, reports in the Telegraph, 1.8 million pensioners live below the poverty line:
Despite
inflation falling slightly, the Retail Price Index is still at 5.3pc
with food and fuel rising rapidly, yet pensioners will only see the
basic state pension increase by 4.5pc this year and other benefits by
just 3.1pc.
In
fact, even the standard Retail Price Index can understate older
people's living costs. Age UK Enterprises' Silver RPI measure shows
that since 2008 inflation has been higher for older people than for
those under the age of 55. This is partly due to low mortgage
interest rates – which are less likely to impact on older people – as
well as cost increases on products and services like food and energy
that over-55s spend proportionately more on.
As a result, we know these are difficult times for many older people
and growing numbers are struggling to make ends meet. 1.8 million
pensioners live below the poverty line and research that Age UK will
release tomorrow shows millions more are teetering just above it.
Bills accrued over the cold winter months have put a huge amount of
pressure on people's finances and many are still paying the price
now.
Of
course the options to increase your income once you have retired are
few and far between. Nearly 1 million people are now working past 65
in part-time and full-time jobs in order to boost their retirement
incomes. But for many people in their 60s, ill health and caring
responsibilities for partners or elderly parents mean carrying on
working simply isn't an option.
To try to bring poorer pensioners' incomes to a decent level, the
Labour government introduced pension credit, which tops us low
incomes. Yet around a third of people who are eligible to claim the
top up aren't getting it, with up to £3 billion unclaimed. Likewise,
almost 2 million pensioners aren't claiming council tax benefit which
could save them an average of £728 a year.
The UKPA provides more details, reporting most pensioners 'just getting by':
Rising
living costs are causing hardship for British pensioners, with 58%
saying they are "just getting by" or worse, according to research.
A
study for Age UK has found that 47% of over-60s class themselves as
"just getting by", with a further 11% finding it difficult or "really
struggling" to cope financially.
The face-to-face survey of 1,258
people conducted last month shows nearly one in five pensioners, or
19%, cut back on heating this winter in order to make ends meet. The
same percentage said they are going out less in order to save money and
more than one in four, or 26%, said they are buying cheaper or less
food.
Among poorer pensioners, the
figures rose to more than a third, or 35%, buying cheaper or less food,
and 21% going out less. A total of 11% said they are in debt through
mortgage, credit cards or bank loans.
The findings have been
released to coincide with Age UK's More Money in Your Pocket campaign
aimed at encouraging over-60s to claim all the benefits they are
entitled to after the charity found as much as £5.4 billion goes
unclaimed each year.
Just under a half
of pensioners are entitled to pension credit, the top-up for people on
low incomes, but a third of people eligible for the benefit do not
claim it, according to Age UK.
Up to 1.97 million pensioners are
also missing out on council tax benefit worth £1.5 billion a year - if
claimed this could boost their income by an average of £728 a year, it
calculated, while up to 350,000 older people are entitled to housing
benefit but are not receiving it.
Michelle Mitchell, Age UK
charity director, said: "At a time when so many people are struggling
financially, it is unacceptable that vital benefits are failing to reach
some of the poorest and most vulnerable older people in our society."
The
charity is urging older people seeking advice on benefits to get in
touch with their local Age UK or Age Concern, or call Age UK Advice, the
charity's free national advice line, on freephone 0800 169 65 65. The
charity has also launched an online "benefits checker" at www.ageuk/benefitschecker.
A
spokeswoman for the Department for Work and Pensions (DWP) said: "Some
people still miss out despite our efforts to improve take-up. This is
exactly why we've set out proposals for reform including a single tier
state pension set above the level of the means test."
These findings are discouraging and should concern us. We know that
rising food and energy prices are hitting pensioners on a fixed budget
particularly hard. And it's not just in the UK. In the US, some outfits
like Shadow Government Statistics are pegging the true inflation rate closer to 10%.
While these statistics are popular with bloggers and doomsayers, I
think this is a gross exaggeration. If true inflation were closer to
10%, bond yields would have spiked regardless of QE2.
But we do know that people are paying more for groceries and to fill up their tank. In my conversation with Pierre Malo yesterday,
we talked about inflation. Pierre thinks it's inevitable that bond
yields will start rising as he feels inflation is understated. It most
certainly is but there is something we should all bear in mind: wages
aren't rising so rising food and gas prices act like a tax because
people have less discretionary income to spend on other items. That's
why I feel rising energy prices are ultimately deflationary, especially
if this is a long term secular trend due to shifting consumption
patterns in emerging markets (Pierre mentioned that Jeff Rubin is right but was too early in his call).
The
Fed's policies are exacerbating income inequality. Great for bankers,
Wall Street traders, and the rich who invest in stocks, terrible for
pensioners and families getting by on a modest budget. But there doesn't
seem to be a big concern about this widening divide, at least not yet.
In the meantime, more and more pensioners are living the dark reality of
pension poverty.
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Relatively easy to spot the impoverished senior. What is not so easy is to find out why. Were they an ant or a grasshopper during their working life? Are we to tax the young to provide more to the old when the old are in their predicament because they didn't save when they were young? In British terms if you spent £ 25 per week for 25 years drinking in a pub is it the state's fault, the next generation's obligation to 'top off' your pension to make up for that?
If you spent 25 pounds a week on booze at least half of that went straight into the government's tax coffers, on top of what you paid in income taxes, social insurance and all the other taxes you paid over a lifetime. So yes I would say the government owes you something.
Inflation is different for everybody no matter what the bond market is doing. If food prices are up 10% and fuel is up 10% and you are a pensioner living on a fixed income whose expenditures are dominated by food and fuel...inflation for you is pretty damn close to 10%.
If you are a student with a fixed income but also have subsidized food/housing/transportation and you spend most of your money on electronic toys, you're probably looking at deflation right now.
Higher level finance types tied directly or indirectly to The Fed's liquidity pumping are obviously "winning" here too.
You'd think it would be obvious that the government is destroying the wealth and lowering the living standards of those who are least able to do anything about it (plain, poor, old people who aren't members of any recognized grievance group).
However (just you wait) when things get bad enough this will morph into the (likely victorious) political argument that even more government involvement and dependency is needed...and now more than ever.
''However (just you wait) when things get bad enough this will morph into the (likely victorious) political argument that even more government involvement and dependency is needed...and now more than ever.''
Mercury,
Totally agree, the end result will be MORE gvt involvement, which could be good or very bad. Communism failed but Marx must be grinning in his grave...
Still hoping that the government will eventually get SOMETHING right, Leo? You are the eternal optimist. It would be nice if they'd get something right, but I have to admit that I'm short gvt competence.
The old Atlas Shrugged redux.
Everbody sell out the movie Atlas Shrugged part one tomorrow! Trailer looks really good.
Nicely done. That's the thing about fiscal and monetary expansion policies - they crowd out the bookends (low-income and fixed-income).
My only concern is: what is the expected standard of living for the elderly? Don't get me wrong, with proper wealth and retirement planning the question is probably moot (to a certain degree), and I'm not suggesting death panels for those less fortunate to have been in the position to save or lacked the foresight, but I was always under the impression being elderly was as much of a lifestyle as it was a phase of life. This includes a massive scale-back in discretionary expenses and even living off the [limited] charity of family members.
I mean, half the reason to have kids is so someone can take care of you when you're unable to provide for yourself. Why are the elderly becoming wards of the state, like a bunch of orphaned children?
What's the other half of the reasoning to have kids? It escapes me.
I do agree with you that the little bastards do have a bit o' responsibility in that area. I mean, a box of Depends now and then would be a sweet gesture.
By my math: 25% altruistic desire to procreate, 25% bad timing (joking!).
This all goes back to my thesis that a two-class system has been deliberately engineered both to serve the ends of long-term political self-preservation and to delay the cognitive dissonance of the "American Dream" by keeping wages high through restricted/thinned labor markets and high regulatory hurdles.
The irony of it all is that in order to give the illusion of wealth, you have to inflate like Hell and take on far more risk than you otherwise would; both of which are inherently wealth-destructive. If you had a massive base of productive labor like we did for ~40 years it's more or less sustainable, but once that pyramid inverts, you're fucked.
Yes, but we must remember that families are struggling too. If both mom and dad work and raise kids, the inflation impact is hitting them just as hard. Clothing, food, housing, energy...it's all inflating at the same time. I expect the trend of multigenerations cohabitating under one roof to increase as the squeeze gets tighter and tighter. Wages have not kept up with cost of living for a long time. My husband just got a 2.5% raise from his cheap ass company. I realize that a small raise is better than no raise at all but 2.5% for longer hours and more responsibility is an insult and does not keep up with our 10%+ inflation. Our family is lucky to be treading water but we are unable to save for our retirement never mind the kids' college educations. We have a small emergency fund tucked away but that's it. Stuck out in the ocean and going nowhere with few options except to keep plugging away with our fingers crossed.
Hey, let's make a deal? Stop taxing our asses to support all the welfare rolls, and we will take care of our own moms and dads in their old age. Deal? I thought not.
Trend? I'd argue that's the norm we've been delaying, and it's only made worse by relatively recent lifestyle shifts and muted in hindsight by increased life expectancies.
But yeah, it sucks to be on the margin. I know how it is.
Yet the UK has money instantly available to bomb any country
Boo-hoo-hoo! Subsidized housing, subsidized utilities, subsidized food, and plenty of govt-supplied spending money: so hard for England's "poor"! What will they do? What will they do??
Leo will not be satisfied until a govt worker is dispatched by CCTV to come wipe your ass, when you're done with your morning sit-down...
Leo, You really have to stop feeding the Trolls and Sociopaths. Take this guy above ... he has convinced himself that;
a) it's the pensioners fault that he was forced to pay into a Ponzi scheme he didn't understand and will never keep up with real inflation.
b) he bears no personal responsibility towards his elders even though his elders wiped his ass when it was necessary.
If there is a hell this guy will spend eternity wiping geriatric asses and licking dick cheese whilst gently cradling their saggy ball sacks.
a) it's the pensioners fault that he was forced to pay into a Ponzi scheme he didn't understand and will never keep up with real inflation.
Actually penisons, in terms of government handouts helps create inflation, it cheapens money. Literally it's being given away.
b) he bears no personal responsibility towards his elders even though his elders wiped his ass when it was necessary.
Were you responsible to get your parents to save money for a rainy day? No.
Are you responsible to take care of your own business? Yes.
Did you give brith to yourself? No, your elders made the decision to procreate. the magical act of rubbing genitals together to extend the genetic lineage. Somehow I doubt you were involved in that decision. You became a cost on someone elses decision.
Except that it is the pensioneers fault that the younger generation is forced to pay into the ponzi and will never contribute. And I, for one, am willing to wipe my parents asses in their old age if, by doing that, we can call it even. Capisce?
Special Beastie Service: Go fuck yourself, shithead
Agreed... the right wing "divide and conquer" meme is alive and well, and the sheep are clearly falling in line... sadly a very effective, even if morally bankrupt, model that will continue until those in the sheep camp begin to feel the pain themselves... then the whole 'Cowboy' act comes crashing down in a heap of self (all they know) pitty.
Right wing? Left Wing? Do you really think that it matters who throws you under the bus? Or do you really believe that the 'Left' is so much more caring and would never do such a thing?
yes, I do.
that is, in fact, exactly what people who believe in socialism think. Beats the heck out of thinking that old people who saved all their lives only to find in their retirement that their fixed income yields have fallen to 0.01% are somehow to blame for their predicament.
That's sweet. Let me know how that socialism thing works out.
Never said the old folk were responsible. Socialists are throwing old folk under the bus just as quickly as'right-wingers'. The only difference is that they try and convince the oldsters that it is to their benefit to go lie in the road (but if they don't go voluntarily they get a firm shove). Look behind the platitudes at what they actually do.
Life is not fair. It's nice if we can have a safety net for those who fail to save, for those who throw it all away, and for those who, through no fault of their own, lose what they put aside. I am all for it. Let us start with your money, and when that's done, then we can look at mine.
Now we will be presented with the spectacle of opportunistic politicians declaring that we must pay more taxes to help these poor seniors.
I happen to think that we are all responsible for our own retirement, and I am quite annyoyed by the fact that I have been very careful to live below my means and save something. Now it seems that my neighbours who took wonderful expensive vacations, bought too much house, always had a recent model car, and enjoyed going out to shows and restaurants frequently, want me to pay for their retirement. Asset-based tax to follow?
Why are we punishing the ants and rewarding the grasshoppers?
Many have saved and find that those savings, which seemed plenty at the time of saving, are now greatly inadequate. Working people have saved and found that their savings have completely gone. Why the assumption that ALL pensioners fit one category, that whichever better suites to serve here the complaintant commenter's personnal prejudice ?
How is that anyone's problem again? No clue where this concept that we are all ultimately responsible for someone else's poor planning. If they have a problem correlating that fact the only primary assets they own is the crap they've accumulated over a lifetime (cars/suits/homes/chairs/brickabrack) and they missed the idea of saving for a rainy day and BUILDING their pile of wealth (doesn't necessarily mean money, it can be anything with a return).
Seriously, why should anyone reward stupidity or make the fatal attempt to fix it.
And I seriously doubt those saved any reasonable amount to prepare for retirement.
http://www.walletpop.co.uk/2010/08/06/average-pension-savings-fall-short...
Tonnes of articles on the subject regarding the demented attitude that afflicts practically all western knuckleheads. My underlying suspicion is that 90% of the human population raised in western schools simply could never perform any level of elementary math.
Then again...these are adults, they can get a gig being a golf caddy/walmart greeter/etc. Or open a business/consult, lots of opportunities for senior industry states people to offer advice on how to keep things running smoothly.
The assumption is NOT that ALL pensioners fit one category. I am just whining about a subset.....
Don't capitulate gmak... you're arguing the rule, he's arguing the exception... in a nutshell, it's called moral hazard.
As the UK "Baby Boomer" generation now reaches retirement age the numbers of pensioners will rise dramatically in the next decades.
How much of the above data is relative to private pensions or state pensions ? How many pensioners have found reductions in their private pensions as of recent ?
Would greatly appreciate further info on this.Some people are finding it difficult to get the extra, or any, work even over the age of fifty, i can believe that those over retirement age who wish to , or need to financially, continue working have difficulty to find the work, or get accepted by potential employers who don't want pensioners around ( possiblies of more sickness related time off work than younger employees, or other discriminatory lines of thought).
Awww poor pensioners, sat in their 300k houses they bought for 5k.
Meanwhile their wealth relies on their future generations buying the bubble.
What does "just getting by" mean? They can only afford Sky sports, not movies and sports? Only 10Mb broadband?
The UK definition of poverty is insane.
Pensions who are getting more than they paid into are getting a steal no matter how small the checks may be.
How about in 30 years, in UK, nobody will have a pension. How will people get by then?
We will see the other side of globalization: citizens leaving overpriced housing and overtaxed countries they grew up in for a cheaper and warmer country for much higher quality of life. So effectively government would be pouring money into old people living in another country, while young generations get taxed to pay for them.
Clawback boomer generations pensions. Limit should be imposed to max of total contributions for all.
It's not a steal. Pensions are 'survivor plans'. The money contributed by folks who die early is parceled out to the survivors, so every survivor might get more than they put in. It works the same way for SocSec as it does for private pensions or annuities.
The theft was by the politicians who promised actuarially unsound benefits, and took the contributions and threw them down a rathole of corruption and handouts.
If you limit SocSec payments to initial contributions, then you are the thief. You are stealing all the interest from the contributions, and the remaining contribution from those who die early.
Read the article again. 19% say they can't afford to heat their homes properly and still pay their bills. Among poorer pensioners, 35% say they are buying less food or cheaper food to make ends meet. 1.8 million are below the poverty line.
Laugh while you can. Throw granny under the bus and give the money to the big banks. What do you think they will do to you when your time comes?
Hey, you are only looking at the downside (inability to afford stuff) without looking at the upside (these folks are getting to live much longer than they thought they would!)
Bleeding idiots, man.
how come there is no outrage about poor old people in africa? or any sympathy for the old there who cant eat 3 meals a day? i dont feel much sympathy for old people who live in houses and cant "afford to heat" houses when there is a lot of starving population out there. wealth will normalize from the west to the east and africa whether the population likes it or not. or there will be another world war.
Because there are not that many old people in Africa. Life expectancy is lower than retirement age in Europe. In Swaziland, you are expected to live to 32.
btw am not supporting tax breaks for the wealthy or banker bonuses. i think most bankers should be shot... but i do think standard of living in the west in general will go down. because they really are competing with cheaper labour in the east. and i see no reason why they shouldnt.
'Just getting by' - lolz ask any1 to on street in UK how he's doing and you'll get something between 'just getting by' and 'getting by' there are no other responses on the 'form'
Besides your right, 'just getting by' in UK or USA means a 42 inch. TV set and 2 weeks vacation in the Mediterranean / Carribean
This is Obama's magic bullet. Inflation hits those on fixed incomes the hardest. So....
1. get the Bernank to generate some serious inflation
2. old people will starve
3. Medicare savings will ensue
4. SS will be balanced
5. deficit is fixed
That man IS a leader.
+666
Death panels--the universal answer.
+