Over 75s hit hardest by inflation
Inflation continues to hit pensioners the hardest despite falling in the last month.
Over 75s face inflation rates of 3.6%, the Alliance Trust revealed this week, 64% above the national average of 2.2%.
Brits aged 65-74 also face higher than average inflation at 3.0%.
Inflation is higher for the elderly because they spend a larger proportion of their budgets on basic goods and services such as food and utilities, where inflation remains high.
Utility price inflation is especially high, with electricity price inflation at 7% and gas price inflation at 24%.
Shona Dobbie, head of the Alliance Trust research centre, said: “The benefits of falling prices continue to come through more slowly for the elderly, who spend a larger share of their budgets on the basic goods and services; where price falls have been more limited.”
By contrast, the younger generation spend more on discretionary goods such as CDs, clothes, and gadgets, where prices have fallen rather than increased.
“The under 30s currently face the lowest rate of inflation, at just 2.1%, since they benefit most from falling prices of clothing and audio-visual goods,” Dobbie said.
She added that elderly people have also been hit by the Bank of England’s cut to the base rate of interest.
“Unfortunately it is the elderly, who often rely on income from savings, who are simultaneously suffering the biggest impact of very low interest rates,” Dobbie said.