Norwich Union reveals over-50 divide
While regions like Cheshire in the north west, the Cotswolds in the south west and London are typically considered to be the UK’s ‘wealth hotspots’, a study by Norwich Union Personal Finance has revealed a rather different picture for the over-50s.
Despite having more than twice the national average of equity tied up in their properties, retired people in London are actually far worse off than their counterparts in the north east and Wales in terms of money left over each month.
The Datamonitor and YouGov study, commissioned by Norwich Union Personal Finance, has found those retiring in London need an annual income of over £18,500 to get by, almost £3000 a year more than the national average of £15,850 per year.
In fact, while over-50s in the UK have an average surplus of just over £1,000 per year, older households in the north east enjoy one of the highest surpluses, more than double the average at just under £2,500 per year. In Wales older households also have twice as much left over each year, with just over £2,000 at their disposal. Londoners, by contrast, have the second smallest surplus income of all the UK regions, with just over £1,000 to spare after all household spending.
Daren Carter, sales and marketing director at Norwich Union Personal Finance commented: “Our study reveals quite a startling new picture of how wealth is distributed among the over-50s across the UK. The traditional north/south divide has been turned on its head with over-50s in the north east and Wales being twice as cash rich as those in London, despite the south retaining wealth in property.”
For some older people however, having any money left over at the end of the month is unlikely. Overall the study found 24 per cent of over-50s struggle to just break even each month; 31 per cent of whom have no surplus income at all and 7 per cent who have expenditure which exceeds their income.
Carter concluded: “Where living costs are high and people have equity tied up in their homes, it seems unnecessary for older people to struggle to get by or be unable to enjoy their retirement to the full. While downsizing their property could be an option for some people to free up much needed cash, for those who are eligible who don’t want to leave the family home, releasing equity through a lifetime mortgage or reversion scheme could be an alternative.”