How pensioners are spending their cash

Pensioners are richer than the working population - so how are they spending it?

A shop assistant showing a customer a television

Baby boomers invented the commercial age, so it should come as no surprise at all that as they enter retirement, they are spending money at a phenomenal rate. And why not? They are healthy, wealthy, have plenty of time on their hands, so they are free to enjoy the fruits of a lifetime of saving.

Pensioners are seeing wealth on a new scale. A study by the FT revealed that people over the age of 65 are now richer than 60% of the population. Most of them are free from the kinds of debts and savings hurdles faced by their younger counterparts, and according to the ONS, they are 50% richer than pensioners were in 1995 (helped in part by rising property prices but also by increases in the state pension).

Clearly not every pensioner is quite so lucky, and there are plenty struggling on low incomes, or just getting by on much less cash than they had throughout their working lives. However, as one in ten are now technically millionaires, there's an opportunity to splash the cash.

It's not just wealth on their side. Unlike previous generations, retirees are leaving work in good health nowadays, with decades of retirement to look forward to. They aren't ready for the fireside and a newspaper; they are ready to embrace those things denied to them throughout a life of inflexible working options - and plan to travel, indulge in hobbies, and enjoy life.

It's no wonder that according to Saga, the over 50s now account for almost half of all the money spent in the UK - at £320 billion a year. It's why so many advertisers and businesses are getting so hot under the collar about the power of the 'grey pound'.

Older people are spending their money fast too, Canada Life found that retirees spend their money three times as fast as working people. "Times have changed for retirement in the UK. Living standards are better than ever before, and retirees now have the financial firepower to make the most of later life," says Richard Priestley, executive director of retirement income at Canada Life.

We reveal exactly how retirees are spending their money - and some spending trends may come as something of a surprise.

How we spend our pensions

How we spend our pensions