Pensioners’ inflation 80% higher than average
Pensioners face inflation rates 80% higher than for the average consumer because their budget only stretches to buy essentials, new research has discovered.
Inflation dropped in January to 3% for the average consumer. Over 75s, meanwhile, faced inflation rates of 5.4%, according to research by the Alliance Trust.
Younger generations spend more money on consumer goods such as electronics and entertainment equipment.
The elderly, however, spend the biggest proportion of their income on essentials such as food and energy bills – both of which continue to increase in price at more than the average inflation rate.
Gas prices have increased 50% over the last year, whilst electricity has risen 30%.
Food price inflation also remains a problem with prices still 11% higher than a year ago.
This hits over 75s the hardest, as they spend over 7% of their budget on energy bills and 16% on food – compared to 3% on energy and 9% on food for under 30 households.
Shona Dobbie, head of the Alliance Trust Research Centre, said: “Younger age groups are benefiting most from the current downturn in inflation, as they spend relatively more on audio visual products and clothing and footwear, where prices are falling quickly.
“The elderly are not seeing the same benefits of falling prices as the young.”
She added: “The rate of inflation facing the over 75s has been reduced to 5.4%, but this is 80% higher than the official rate of inflation of 3.0%.
“This confirms that the elderly continue to be hit hardest, even now that inflation is in retreat.”