Pensioners worst hit by CPI rise
The inflation rate is slightly above the figures seen over the previous 12 months but below the levels reached between the start of 2010 and spring 2012.
The largest upward contributions to the change in the rate came from motor fuels and clothing & footwear.
Vince Smith-Hughes, retirement expert at Prudential, said: “The rise in inflation will have a major impact on households throughout the UK.
However pensioners will be amongst the hardest hit since they spend higher proportions of their income on essentials like food and fuel, which are seeing the biggest price rises.
“The combined effects of falling retirement incomes and inflationary pressures make pensioners amongst the most financially vulnerable.”
This year the average expected income for those in retirement hit a six-year low of £15,300 which is 18% down on 2008.
Smith-Hughes said: “When making any financial plan for the future, it’s vital to take into account the impact of inflation, particularly if you’re choosing an annuity.
“It’s best to start by contacting a financial adviser or retirement specialist, who will be able to set out the best options for protecting income against inflation in retirement.”