Those between the ages of 50 and 60 have been worst hit by the economic turmoil, suffering from a significant decline in their quality of life, according to an in-depth report into the finances and wellbeing of older citizens.

 The report, published by the Saga group, found that the generation coming up to retirement have been effected badly by the rising cost of living, unemployment and a fall in savings.

While many of those who have already retired are enjoying decent pensions and have paid off their mortgages, those in their 50s are enjoying no such peace of mind, the report makes clear.

The study included a survey of 13,000 people over the age of 50 as well as a detailed analysis of Office for National Statistics data, undertaken by the Centre for Economic and Business Research, a think tank. It laid clear the concerns and problems facing the so-called baby boomer generation born between the end of the war and Harold McMillan declaring that Britain had never had it so good.

The study found that the annual real disposable income – taking into account inflation – had fallen from £34,366 a year ago to £33,900, or those between 50 and 64, an annual fall of more than £450.

Ros Altmann, the director general of Saga, and former government pensions adviser, said: "Inflation has really hit those who have yet to retire. They tend to still drive a lot, they still need to heat their homes, and they may still have a mortgage.

"This age group has also been badly affected by unemployment."

Though school-leavers and graduates have widely seen to be the worst hit by the increase in unemployment during the recession, the report points out that those approaching retirement have suffered acutely from long-term unemployment.

Of those unemployed aged 50-64, 43 per cent have been out of work for more than 12 months, compared with 27 per cent of 18-24 year olds.

Ms Altmann said: "In theory you'd think this group of older workers would be more skilled and stand a better chance of gaining another job. In reality there are many who find the door shut in their face the moment the employers sees their date of birth.

"For many of them their life is effectively over. They are too proud to live on benefits, but their savings have been eroded by two years of record low interest rates."

The 13,000 respondents to the survey were asked how they felt compared with a year ago, ranking their happiness, health and financial wellbeing. A score of zero indicates no change, while a minus score indicates feeling worse off. The overall index was -8 for all of those over the age of 50 including those well into retirement. However, in the 50 to 54 age group – despite having far fewer health worries – the index was -10.

A separate report from Prudential found that 62 per cent of people, who originally planned to retire this year are now planning to carry on working, with nearly half of those saying they will definitely have to continue to work to supplement their pensions or build further savings. 

Article from The Telegraph