The official inflation rate might be falling overall, but according to Saga, things are still desperate for older people. The double whammy of increasing expenses and a fixed income means there's nothing they can do to keep pace with rising prices.
So will things ever improve for older people?
Higher inflationIt felt like a massive relief when the official figures came out, and the inflation rate finally eased back to 2.5%. Of course, prices are still rising, but at a less alarming rate.
However, for older people, there is no relief. According to Saga, the CPI inflation rate for those aged 65-74 in August was 2.7% and for those over the age of 75 it was 3%.
In means that in the five years since the financial crisis began, prices have risen an astonishing 19.6% for those in their 50s and early sixties, and 22.8% for those in their late 60s and early seventies. This compares to the population as a whole who have seen rises of 16.8%.
Paul Green, head of communications for Saga says that this reflects the trend that the company has seen since it started tracking inflation for older people 18 months ago.
Why?The issue is that older people spend their money on different things compared to younger people, and the prices of things that make up a higher proportion of their expenditure, such as petrol, electricity, gas and food, are rising faster.
Green adds: "Another fundamental difference for this age group is that they have very little outstanding mortgage debt, so while the general population has benefited from the negative inflationary effect of mortgage rates coming down, older people saw no benefit."
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The concern is that these items which are already causing so much grief for older people, are unlikely to fall in price in the immediate future. Worldwide poor harvests are likely to mean higher food prices, while the price of fuel is forecast to rise across the board this winter. Green warns: "It doesn't seem to look better for older people as we go forward. It is a winter of their discontent."
The double whammy is that not only are costs rising, but in many cases it is difficult for older people to do much to increase their income to help deal with these rising prices. Green highlights that many are staying in part time work. However, he adds: "Many older people will not be able to re-enter the jobs market, so they are not able to react by increasing their income. For them the squeeze is real, and without relief."