Scottish Widows: Grandparents in debt to tune of £57 billion

1 in 5 retired homeowners (1.1 million) 2 still have a mortgage

Average outstanding mortgage debt is £38,000 1 in 3 have carried over credit card or personal loan debt for the last 3 months Average outstanding non mortgage debt is £5,900 1 in 12 retirees have financially dependent children Research from Scottish Widows UK Pensions Report 2007 reveals around one in five (over 1.1 million), retired homeowners in the UK have an outstanding mortgage on their home - with an average debt of £38,000.

What is more, one in eight owe more than £50,000 putting increased pressure on retirement income.

When it comes to short term debt (e.g credit cards, personal loans etc) the situation is no better.

Almost one in three have carried over short term debts for each of the last three months - with the average outstanding balance owed being £5,900.

This makes the total nationwide debt held by those in retirement ?57 billion.

Ian Naismith, head of pensions market development at Scottish Widows, says: "Our research shows that by the time they come to retire a significant number of pensioners still have a mortgage outstanding on their property, adding financial pressure to their hard-earned retirement fund." The study also shows that many pre-retirees (aged 50 to 59) are a long way from owning their own home - suggesting that the trend of retirees still being burdened by monthly mortgage repayments is likely to continue.

Of those in this age bracket over four out of 10 (42%) still have a mortgage with an average debt of £54,300.

And what of those aged between 60 and 64? Well one in four (25%) have a mortgage and the average debt is £42,800.

Naismith continues: "It is important for those people who will be reaching retirement in the next few years, and still have debt outstanding on their mortgage, to consider how best to prepare themselves for the eventuality of having to juggle their debts on a reduced income when they stop working.

"With more and more people taking out mortgages later, and paying them off later, we are seeing many people turning to the equity in their home as a method of providing income in retirement.

The knock-on effect of getting on the housing ladder later is that money that could have been put into a pension is being used on monthly mortgage payments." The research also shows that one in 12 (almost 700,000) retirees have the added burden of one or more financially-dependent children proving the 'Sorry' Generation is alive and kicking.

Almost two thirds of these offspring are aged 18 and over - with 16% aged over 35.

Those in retirement - perhaps not surprisingly - believe you should start saving for retirement sooner rather than later.

When asked at what age you should start putting money away - a retiree suggests 27 years and 7 months old, almost three years earlier than those currently aged 18 to 29 - who think 30 years and 4 months is a good time to start.

Retirees are also more sanguine about what is meant by being 'well off' - believing an annual household income of £27,700 will be the envy of your neighbours, compared to the nation as a whole who believe you need £36,300 to be considered 'well off'.

Perhaps most worrying for those currently not in retirement and not saving, is that today's retirees have an average household income of £22,900.

With the Basic State Pension providing £7,259 a year 3 today's retiree couple is evidently in a position to boost this amount by up to two times more with income from other sources - e.g personal pensions, investments and savings.

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