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Mikhail Liebenstein

The Over-55S With No Pension, No Savings, Just Massive Debts

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http://www.dailymail...sive-debts.html

I think quite a few on this site will have no sympathy for the plight outline below. The bit that really annoys me is that "as they cannot bear to sell the home where they have lived for decades" For heaven sake, people who rent get forced to move and not a whisper and many others have been repossessed, why then sympathise with someone who has had years to pay off their mortgage and who will have benefited from huge HPI.

Millions of the elderly and people approaching retirement have no pension, no savings and large debts, shocking research reveals today.

Many plan to use the equity in their house, which averages nearly £150,000, to pay for their retirement.

But this plan often fails, as they cannot bear to sell the home where they have lived for decades, which has triggered a surge of interest in equity release schemes.

The major study, from insurance giant Aviva, found one in five people over the age of 55 still had a mortgage.

The average size of their home loan is £60,440, which will wipe out a large chunk of their monthly income.

The situation is even more bleak for people over the age of 75, with 4 per cent still having a mortgage, with an average of nearly £100,000 outstanding.

Edited by Mikhail Liebenstein

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So your house is not actually your pension because you can't "bear to sell" it. Good investment.

Oh dear, how sad, never mind.

I've had this discussion with people in their 40s and 50s moaning that they still have debts and that they're not paid enough. I point out that if they sold their house they wouldn't have those debts, so please stop moaning whilst I save my sympathy for people who do not have such a simple route to clearing their debts.

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So your house is not actually your pension because you can't "bear to sell" it.  Good investment.

This is the problem with HPC occurring on any scale anytime soon though. There are a lot of people who are uncomfortable, but they don't need to sell right now or perhaps for the next 20 years until they leave in a wooden box. Meanwhile they turn out to vote and elect people who refuse to build decent new homes.

My view is that the free market will solve this, but not in the way many HPCers expect.

If the price of bread quadruples, as does fuel , Council Tax etc, then this will make these people sell, of course we can only hope wages for the working population increase as well - though with retiring boomers I am expecting to see severe skilled labour shortages and large wage rises over the course of the next 15 years.

Just for the record, another of my friends has just left a large IT firm for a bank and has practically doubled his salary. Right now the less skilled workers are still sitting tight, but  some employees are making moves to substantially improve their position. I also met with a guy from another major IT firm yesterday who said they were now looking for a new leader and ideally a salesman rather than an accountant - ie they are planning for growth.

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I can understand the reluctance to sell and downsize:

- People often have a big "emotional" investment in their house possibly having lived there for decades, through happy times and raised children

- It might be viewed as throwing in the towel, unable to maintain the standard of living in retirement (what would friends & neighbours think?)

- Perhaps they're frightened of "loosing out" on another big round of house price increases

- Too old to face the hassle of selling, buying and moving, just keep finding an excuse to put it off for a bit longer.

It's very sad when people refuse to downsize but are struggling to meet the running costs of a large property and so neglecting other things in life. If you're unable to take care of basic maintenance such as decorating or gardening it gets very expensive to pay someone else to do those jobs for you. I can see several examples of this in our local area, usually the first thing to let go is the garden. After a year or two they start to look like the Amazon jungle. Then the next thing is the outside maintenance such as painting, the gutters or the odd roof tile. All this just to keep living in a large house with more bedrooms than they'll ever realistically use. I know one pensioner who openly admitted that a couple of weeks can pass without them going into some of the spare bedrooms!

On the other hand I know an elderly couple who made the decision to downsize and say it's the best thing they did.

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The bit that really annoys me is that "as they cannot bear to sell the home where they have lived for decades"

Although I pretty much agree with you, isn't it a bit hypocritical that HPCers love to spout the mantra that "a house is your home and not an investment"?

My wife's old granny sold her very big house a few years ago to move into a more manageable bungalow. The old place has recently gone back on the market for over half a million quid. Tch! all that inheritance gone....

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My dad is 76 and he still has a mortgage. Only about £15k but he is a bugger for high end cameras, is obsessed with golf and has an unhealthy relationship with whisky. He does have a pension of about £1k a month but God knows how much debt he's run up with his various hobbies - don't know the details but most of it must be going aginst the equity in the house.

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The problem is that these selfish old people are occupying family sized homes that the next generation need to raise their children in. Granddad needs to understand its time to stand aside and let the new generation get on with building the future which will ultimately pay for their healthcare and surrounding infrastructure.

Where I live we are surrounded by large nice houses near the schools, largely occupied by elderly couples. While the young families are crammed into small houses at the other end of the town.

It’s a terrible situation.

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"The situation is even more bleak for people over the age of 75, with 4 per cent still having a mortgage, with an average of nearly £100,000 outstanding."

:o An average of nearly £100,000 outstanding.

How on earth did those banks think they were going to pay that amount back, at that age?

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Where I live we are surrounded by large nice houses near the schools, largely occupied by elderly couples.

Same situation by our Village Infant & Junior schools.

Especially annoying is the mad old bugger living on his own in a huge house with weeds & branches growing through the fabric of the house.

It will probably have to be demolished - complete scandal.

I wonder though - why were the schools built on prime real estate in the centre of the village instead of down the cheap end where most of the children come from?

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:o An average of nearly £100,000 outstanding.

How on earth did those banks think they were going to pay that amount back, at that age?

Sounds a bit like equity release..

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So your house is not actually your pension because you can't "bear to sell" it.

No, your house is not your pension 'cos after 101 years you still haven't bought it.

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This is the problem with HPC occurring on any scale anytime soon though. There are a lot of people who are uncomfortable, but they don't need to sell right now or perhaps for the next 20 years until they leave in a wooden box. Meanwhile they turn out to vote and elect people who refuse to build decent new homes.

My view is that the free market will solve this, but not in the way many HPCers expect.

If the price of bread quadruples, as does fuel , Council Tax etc, then this will make these people sell, of course we can only hope wages for the working population increase as well - though with retiring boomers I am expecting to see severe skilled labour shortages and large wage rises over the course of the next 15 years.

Just for the record, another of my friends has just left a large IT firm for a bank and has practically doubled his salary. Right now the less skilled workers are still sitting tight, but  some employees are making moves to substantially improve their position. I also met with a guy from another major IT firm yesterday who said they were now looking for a new leader and ideally a salesman rather than an accountant - ie they are planning for growth.

You are delusional. The over 65's will just carry on working if the value of pensions fall in relation to prices. Your generation may well get your wish to destroy pensions in the UK but all that will do is mean that the older generation will prevent the younger generation from progressing in the world of work. The law of unintended consequence i'm afraid.

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I wonder though - why were the schools built on prime real estate in the centre of the village instead of down the cheap end where most of the children come from?

Were the schools built before the cheap housing? I think it's a good point you make, but a lot of perfectly serviceable primary schools were built where the centre of the village used to be, rather than closer to the later estates that sprang up around the periphery.

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You are delusional. The over 65's will just carry on working if the value of pensions fall in relation to prices. Your generation may well get your wish to destroy pensions in the UK but all that will do is mean that the older generation will prevent the younger generation from progressing in the world of work. The law of unintended consequence i'm afraid.

Who is going to employ all those oldies? People I know are finding it hard enough over forty.

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The problem is that these selfish old people are occupying family sized homes that the next generation need to raise their children in. Granddad needs to understand its time to stand aside and let the new generation get on with building the future which will ultimately pay for their healthcare and surrounding infrastructure.

Where I live we are surrounded by large nice houses near the schools, largely occupied by elderly couples. While the young families are crammed into small houses at the other end of the town.

It’s a terrible situation.

It's null , the young people can't afford the big houses the elderly are living in instead getting a "cheap" shoebox.

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I wonder though - why were the schools built on prime real estate in the centre of the village instead of down the cheap end where most of the children come from?

Why did they build Windsor Castle so near to that big airport instead of somewhere peaceful?

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Why did they build Windsor Castle so near to that big airport instead of somewhere peaceful?

Boom, tish!

However, the Junior school is 60s, the infants Victorian but more of it is 60s extension and the houses vary from 30s back to Elizabethan, mostly Victorian.

I suspect the Junior school was rebuilt where an older school was - line of least resistance because people in big houses hate change so would have fought against relocation and a new housing estate where the old school was and people working for councils, especially back in the 60s, are mostly lazy.

Edited by xux42

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Who is going to employ all those oldies? People I know are finding it hard enough over forty.

Exactly! Even though I have all the latest certifications and experience I have struggled to find IT work ever since turning 40.

Very galling when the so called journalists are constantly talking about a 'skill shortage' and saying things like 'well, we need highly skilled immigrants to fill the positions that UK workers cannot do'.

What the hell jobs are there out there that UK workers cannot do? Are we uniquely thick or incapacitated in the world?

Or is it just the slave wage vested interests spinning as usual?

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Who is going to employ all those oldies? People I know are finding it hard enough over forty.

I've no idea but the new laws on keeping people on over 65 will make it easier for those 'oldies' who want to stay on and work to do so, and raising the pension age to 66 will mean aq few million younger people will have their work life aspirations delayed by a year.

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Were the schools built before the cheap housing? I think it's a good point you make, but a lot of perfectly serviceable primary schools were built where the centre of the village used to be, rather than closer to the later estates that sprang up around the periphery.

Some the of the cheap housing is older, some younger, therefore at some point the land would have been available to shift the schools to reflect the new centre not rebuild on the historical centre.

I suspect a few councillors and their mates in the big houses made the decisions in their own interests. The control a small minority have over land use and construction in a given locality is a scandal and the ordinary folk should wake up.

Sadly, history shows us that people are deeply reluctant to face up to the powerful and keen to go back to a quiet life even when they have.

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It's an interesting concept.

Over 55 with masses of debt, nice! ...not.

When interest rates were low, did people try to reduce their mortgage balance, did they hell!

When endowments were proven to be crap, did they use any excess money they made in bonuses etc to reduce their mortgage balance to compensate, did they hell, they were all quite happy to blame their IFA, bank, building society, whosoever would come into the firing line!

People should wake up to the fact that the only people interested in their finance and the way they handle their own money and future is THEMSELVES!

The politicians, financial commentators have been shouting about a pensions meltdown for years and I mean 20-25 years as far as I can remember.

I worked in the financial industry as it is called now and I made it a point to keep my mortgage at a reasonable level all the time I had one, sure I had a shortfall with the endowment, but it didn't matter a jot, I paid my mortgage off 10 years early anyway. When the endowment "matured" even with its shortfall, I bought something nice with it as the mortgage had gone.

Now I don't profess to be the sharpest knife in the drawer, but I took control of my finances when I was about 10 years old, when my Dad suggested if I wanted something I should bloody well save up for it!

I'm a boomer, born it the very late 1950's. I have no mortgage, no debt other than what is on my credit card which I pay off every month and have done so since 1984!! The credit card companies probably have a name for me no doubt!

All I can say to the over 55's with massive debt is TOUGH! You only have yourself to blame! Stop bitching about it!

topliner

(edited for spelling mistakes!)

Edited by topliner

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Some of those mortgages might be 'Bank of Mum and Dad' withdrawals. I guess the choice was do I want my grown up kids living at home with me, or do I cash in some of the equity now to 'help them onto the ladder'/'get them out of my hair'.

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I've no idea but the new laws on keeping people on over 65 will make it easier for those 'oldies' who want to stay on and work to do so, and raising the pension age to 66 will mean aq few million younger people will have their work life aspirations delayed by a year.

That's keeping people on, not hiring them.

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Exactly! Even though I have all the latest certifications and experience I have struggled to find IT work ever since turning 40.

Very galling when the so called journalists are constantly talking about a 'skill shortage' and saying things like 'well, we need highly skilled immigrants to fill the positions that UK workers cannot do'.

What the hell jobs are there out there that UK workers cannot do? Are we uniquely thick or incapacitated in the world?

Or is it just the slave wage vested interests spinning as usual?

The worst saying is " we need the immigrants to fill the positions that UK workers refuse to do " what tosh !!

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Same situation by our Village Infant & Junior schools.

Especially annoying is the mad old bugger living on his own in a huge house with weeds & branches growing through the fabric of the house.

It will probably have to be demolished - complete scandal.

I wonder though - why were the schools built on prime real estate in the centre of the village instead of down the cheap end where most of the children come from?

I agree (almost) but I have to ask, should the 'mad old bugger' be allowed to 'live in his own house'?. Quite an important question?

I mean, at what level of madness or how many weeds can grow through his roof before it would it be wrong for him to live there?

Don't forget, even without fraudulent banking system, the young, in broad terms, have no money, because they are ....well, erm....... young.

No, the real problem is people, some of whom are young, keep coming up with technological advances to stop old people dying. :)

NO actually even that is wrong.... in part........ The real cause is inflation and those who conspire to cause it. Without inflation Old mad bloke would probably be 'happy' to sell now

1. 'cos he would not be under the illusion his house would be worth more tomorrow.

2. 'cos the proceeds of the sale would be worth the same at sale as they would be, say, ten years hence.

Inflation causes instability, anxiety, linked to the 'fear of being left behind', which is (has been) great for the money lenders / creators.

??

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  • 261 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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