Pensioners hit hardest by Credit Crunch
Credit Crunch Britain is a series looking at the effects of the Credit Crunch of Britain’s attitude to its finances. A survey of UK adults over the age of 16 has been independently conducted on behalf of Skipton Building Society. Skipton Building Society is the UK’s 6th largest building Society.
Britain’s over 55s are being hit hardest by the credit crunch, according to new research from Skipton Building Society. In the first report in its Credit Crunch Britain series, the Skipton’s research indicates that more than 8 out of 10 over 55s have cut back on their outgoings as a direct result of the Credit Crunch.
Since the Credit Crunch first began to impact the UK High Street early last year, mortgage payments and rents have increased due to global liquidity issues. The effect has been to reduce the availability of other credit and exacerbate the sharp rise in utilities, petrol and food costs.
The Credit Crunch has affected most UK adults, the survey suggests. Almost two-thirds (58.5%) of adults, over 16, have cut back on their monthly outgoings due to the Crunch. Women, however, appear to be taking a more cautious approach then men, with 62% cutting back on outgoings compared to 52% of men.
Older people cutting back most
The effects of the Crunch are being felt differently across the age groups; a distinct pattern of increasing age meaning an increasing likelihood to cut back comes out of the research. Those surveyed in the 16-24 age category were almost half as likely to have cut back as those over the age of 55. Of the over 55s who were interviewed, eighty four per cent said that they had reduced their outgoings since the start of the Credit Crunch.
Table 1: Adults who have cut back on outgoings due to the Credit Crunch
| Age Group |
% |
| 16-24 |
55.7 |
| 25-34 |
57.8 |
| 35-44 |
72.6 |
| 45-54 |
76 |
| 55+ |
84.1 |
Across the UK the effects are being felt differently. The North East; where the Northern Rock issues may have been realized more acutely, and London; with high house prices, appear to be reducing their spending more than other regions. However, Scotland and the South West seem less inclined to tighten their belts.
Table 2: Adults who have cut back on outgoings due to the Credit Crunch
| Region |
% |
| East |
60.6 |
| London |
62.3 |
| Midlands |
59.7 |
| North East |
62.8 |
| North West |
58.3 |
| Scotland |
54.0 |
| Southwest |
54.8 |
| South East |
56.4 |
| Wales |
58.9 |
| Yorkshire |
57.8 |
| UK |
58.5 |
Commenting, Steve Haggerty, MD Skipton Building Society, said:
"It is clear that the Credit Crunch is having a marked impact on UK consumers’ spending. But the fact, that almost a third of adults have not cut back on their spending at all, suggests that either they are financially strong or that they see the current economic climate as short-term.
"It is our view that, the Credit Crunch will ease in the short-term; making mortgages cheaper and more available, However, the wider, global issues, such as oil prices, will continue to create pressures on the pockets of UK consumers for some time to come."
Ends.
For further information, please contact the Skipton Press Office on 08456 017247, email newsline@skipton.co.uk.
Jason Clarke, head of PR
Charlotte Hird, media consultant
If outside Press Office hours (8am – 6pm, Monday to Friday), please call 07867 851628
Editors’ notes
- Skipton home insurances are underwritten by Norwich Union Insurance Ltd. A member of the AVIVA Group.
- Skipton is the UK’s sixth largest building society, with a national presence represented by its 82 branches, covering the country from Aberdeen to Plymouth. It heads the Skipton Building Society Group, whose subsidiary companies have significant interests in estate agency and related businesses (through the Connells and Sequence groups), third party mortgage servicing (Homeloan Management), credit referencing (Callcredit) and market data supply, independent financial and related advisory businesses and support services to the mutual sector.
- At 0.76%, Skipton’s net interest margin (reflecting the gap between rates charged to borrowers and rates paid to savers) and standard variable rate, at 6.45%, are among the lowest in the industry.
- The research was conducted by Tickbox on behalf o Skipton Building Society. 1800 UK adults, over 16, took part in an online survey between 20th May and 29th May 2008.