One in five retiring this year have debts of over £33,000

ceridwen

LilacPixie wrote: »

There is also the issue that many may of got stung with underperforming endowments so had to remortgage to repayment at some point in the last 10 years.

You've now got me wondering what year endowment mortgages came onto the scene - as there must have been a "credibility gap" time during which no-one much had yet realised they werent going to "deliver the goods". But - it was clear already at some point in the 1980s that they werent likely to "deliver" - as I specifically remember thinking "Gotta make sure its a repayment mortgage I get - and not an endowment one" - but that may have been my cynical nature that told me that (the "If it sounds too good to be true - then it probably is" way of thinking). I dont know at what point the concrete evidence started emerging that these werent going to work out - does anyone know the year the proof first started being there that they were going to "bomb"?

PaulW1965

silvercar wrote: »

If they have a mortgage they can't have cleared their debts. So for half those with debts it could just be that they haven't yet paid off their mortgage - but they may have a plan for doing so.

Or they're men with much younger wives and their wives earn plenty to cover their debts....?

PaulW1965

Graham_Devon wrote: »

The whole point of the survery was to ask these people, when they retire, will they still owe more than they have. I.e. debt.

Interesting article. But it might have been better to ask them about net debt - just 'cos they have debt doesn't mean they don't have savings or investments.

de1amo

i wonder how many have buy to let places pulling in rent more than equal to the repayments on the debt--sounds sensible to me!

ash28

ceridwen wrote: »

You've now got me wondering what year endowment mortgages came onto the scene - as there must have been a "credibility gap" time during which no-one much had yet realised they werent going to "deliver the goods". But - it was clear already at some point in the 1980s that they werent likely to "deliver" - as I specifically remember thinking "Gotta make sure its a repayment mortgage I get - and not an endowment one" - but that may have been my cynical nature that told me that (the "If it sounds too good to be true - then it probably is" way of thinking). I dont know at what point the concrete evidence started emerging that these werent going to work out - does anyone know the year the proof first started being there that they were going to "bomb"?

They were still actively pushing endowment mortgages well into the 1990s - we bought this house in 1993 and were being pushed by a financial advisor towards an endowment mortgage. We refused - although our previous 3 mortgages had been endowment - a colleague at work had received a letter a few months preveiously saying that his 15 year old endowment wouldn't cover his mortgage on maturity - that was the first we had heard a whisper.

Between now and 2015, an estimated two million endowment policies will mature and some companies admit just one in every 100 is on target.
The boom years for endowment sales were 1988 to 1993, when up to four in every five homebuyers were sold one.

Read more: http://www.dailymail.co.uk/money/article-1254984/Mortgage-timebomb.html#ixzz1CDjAX4hA

MRSTITTLEMOUSE

ceridwen wrote: »

As a middle-aged person myself - I don't understand how come they have any debt or mortgage at all .....

I've certainly always worked on the basis that my mortgage and debt had to be gone before I reached retirement age - in order not to prejudice my chances of retiring bang on time.

The thought of having to work on into retirement is :eek: - and there was no way I was going to put myself at risk of having to. Add the fact that there arent many jobs out there - and I believe those there are should go first and foremost to working agegroup people....it was just a no-goer to still have any mortgage or debt by the time I shall be retiring.

We feel exactly the same,to even consider being in debt in our later years would be unthinkable.
We'll be retiring in five years time and started the countdown five years ago by making sure everything was paid off meaning that any extra cash went into our savings for our last five years where my husband still had a good salary.
We wanted no loose ends.
As for having a mortgage into retirement,that's just madness.

tanith

We still have a small mortgage even though I am retired, OH retires in 4yrs and the Mortgage should end in 3 we have no CC debt or any other debt, some small amount in savings and are both putting as much into ISA's as we can so that when OH retires we hopefully with both small occupational pensions and state pensions we will be able to spend time doing some travelling and just enjoying doing nothing when the fancy takes us.

worldtraveller

Tip of the iceberg!

We're heading for a whole generation of retirees where significant numbers will live in penury for more years than they have actually worked for.

Much of this will be down to people living a lifestyle that they simply can't afford, based on cheap credit, in the "me me", "I want it now" society that we have seen, especially over the past 10-15 years.

Few have saved anything like enough, or, in many cases, nothing at all, for retirement.

It's going to get significanly worse over the coming years.

If people think that the State can afford to support them, think on...

ukcarper

I believe this survey was of 1000 people due to retire this year

“Survey conducted by Research plus between 5 and 10 December 2010 among 10,143 UK non-retired adults aged 45+ including 1,005 planning to retire in 2011 using an online methodology.”

It also said average pension would be £16,669.

ash28

MRSTITTLEMOUSE wrote: »

We feel exactly the same,to even consider being in debt in our later years would be unthinkable.
We'll be retiring in five years time and started the countdown five years ago by making sure everything was paid off meaning that any extra cash went into our savings for our last five years where my husband still had a good salary.
We wanted no loose ends.
As for having a mortgage into retirement,that's just madness.

We are retired - we are 56 and retired in October of last year - we still have a few years of our mortgage to go - it isn't an issue - we have very good pensions and a mortgage that is 20 years old - are we bothered - not in the slightest.

If I had to rely on the state pension or a small pension + state then I might have been a bit more concerned.and if I was retiring at our state retirement ages of 66, I probably would be a bit worried about having any outstanding mortgage - but we aren't.

Living the life we wanted for our family was more important to us than being slaves to paying the mortgage off early - we as a family have had good life and that is what I wanted for us. 10 years ago we were still financing 3 kids and we had a lot of outgoings - now we are bringing up a grandchild.

Everyone's circumstances are different and what is important to one person is irrelevant to another.

I've just had an awful thought - our grandchild is being brought up in a household without a working adult - my God!

Btw - we have the money to pay off what remains of the mortgage but have chosen not to - if interest rates take a sudden hike we probably will pay it off - at the moment I'm happy to have the money just sitting there.