Despite inflation fall, UK households still need to find an extra £33bn

Tuesday 14th February 2012

Despite the latest CPI inflation rate falling to 3.6%, UK households collectively still need to find an extra £33 billion to maintain the same standard of living they enjoyed 12 months ago, according to MGM Advantage.

The retirement income specialist says that, for households where the main occupant is aged 65-74, the corresponding figure is £2.8 billion and where they are aged 75 and over, it is £1.85 billion.

To maintain the same living standards as a year ago, the UK would need to spend an estimated additional £524 per person.

MGM Advantage estimates that a typical UK household would need to spend an extra £1,243 a year to maintain their standard of living from a year ago. 

The corresponding figure for households where the main occupant is aged 65-74 is £819, and for older households it is £523.

MGM Advantage recently published a report which revealed nearly a fifth (19%) of non-retired people were unaware of the negative impact of inflation, while over half (54%) were not aware of any way of off-setting it.

"With the average length of time in retirement growing, inflation will have one of the biggest impacts on the retirement nation's financial health,” said Aston Goodey, sales and marketing director, at MGM Advantage. 

“Retirees are disproportionately affected as they spend more of their income on food and fuel, the costs of which are rising faster than the headline rate.”

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