A third of older women in debt have borrowed the money to cover day-to-day expenses according to new research.
Women over 54 who have taken on, or held debt, in the last five years have been trying to make ends meet, found a report by equity release lender More2life and economics consultancy Cebr. This is compared with just over a quarter of men.
Men were more likely to get into debt to finance a large purchase such as a vehicle and to use debt to repay other borrowing.
Women were also more likely to need to make mortgage repayments than their male counterparts.
The findings suggest women are more cautious in their approach to borrowing, focusing on necessities rather than big ticket items.
Most Common Reason for Taking or Holding Debt
To cover day to day expenses
To keep up with mortgage repayments
To make a large purchase, for example, a vehicle
To repay other borrowing
For home furnishing and repairs
One in five people use credit cards to borrow but men are twice as likely to use 0% deals, the research found.
Almost a third of women aged 54 and over said they expected COVID-19 to increase their debt over the next six months.
Figures from the Office for National Statistics (ONS) reveal that employment for women aged 65 and over has fallen by 79,000 between May and July this year – a record decrease for this demographic.
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Dave Harris, chief executive officer at More2life, said: “While unsecured borrowing is how many people manage their day-to-day finances, it is particularly worrying to see that older women are borrowing to make ends meet. With the gender pensions gap a pressing issue, this suggests that those in and approaching retirement are struggling financially which does not bode well for the future."
The research also revealed that nearly two in five retirees aged 54 and over say their monthly expenditure exceeds their household's income, either on an occasional or regular basis.
And more than 70% of over 54s admit dipping into their cash savings to cover necessary costs when their expenditure exceeds their income. Nearly one-fifth have also used their bank overdraft to bridge the gap between income and expenditure.
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