Pensioners have witnessed a 36% rise in the cost of goods and services they purchase over the past decade, faster than the increase in Retail Price Inflation (32%).
Worryingly for pensioners, the escalation in cost appears to be gaining momentum, increasing nearly 9% in the last two years alone.
According to pensions and investments provider Clerical Medical, the average pensioner’s weekly household expenditure in 2001/02 was £200.90, but this had increased to £249.83 by 2006.
Housing costs put pressure on budgets
This rise is largely attributable to the sky-rocketing cost of housing, which increased 33% during the same period, from £47.74 a week in 2001/02 to £63.65 in 2006. Housing costs are the single largest outlay for pensioners, making up one quarter of their total expenditure.
Pensioner spending on recreation and culture has also increased markedly, from £40.14 in 2001/02 to £52.45, while spending on transport increased 31% during the same period to £28.35 a week.
Food and non-alcoholic drinks account for 14% of a pensioner’s weekly budget, or £35.31, while personal goods and services (including health) make up a further 11%, or £27.74 a week.
Pensioners worse hit than most
"The average cost of living facing pensioners has risen by more than one-third over the past decade, more than that for all households during the period, particularly in the last five years,” says Clerical Medical chief economist Martin Ellis.
“Higher housing costs have been the key factor behind rising living expenses, accounting for a quarter of the total average weekly expenditure of a typical pensioner household."
For those who are feeling the pinch, it's essential you cut your outlays by ensuring you're spending the absolute minimum on all your monthly bills. To read more about this, click here.
