New research finds turning 50 is a "financial pinch point".
New research from Investec Wealth & Management has suggested that 50 is likely to be the most expensive age of your life.
On average 50-year-olds were to found to have annual living costs of £27,230. That's £3,800 more than the typical annual expenditure for all age groups.
Here's how typical annual outgoings varied across age groups according to Investec's study:
|
Age |
Typical annual outgoings |
|
21 |
£26,930 |
|
30 |
£23,430 |
|
40 |
£26,030 |
|
50 |
£27,230 |
|
60 |
£20,890 |
|
70 |
£18,740 |
People aged 50 typically spend £7,033 on general living, £5,019 a year on a mortgage or rent, £2,078 on transport and £1,231 on education.
Saving for retirement
On top of facing bigger outgoings, it’s also the age when people try to save and invest more in order to prepare for their retirement.
The research found that people aged 50 are likely to be saving and investing the most money at around £4,883 a year.
A "financial pinch point"
Unfortunately as outgoings are ramped up, it’s also a time when many may find their earning power decline, as official figures show pay tends to peak between the ages of 40 and 49.
So those reaching middle age may find themselves at a "financial pinch point" according to Investec, where balancing saving for retirement with still significant financial commitments becomes a challenge.
[SPOTLIGHT]Nick Gartland, Senior Financial Planning Director at Investec Wealth & Investment said: “Turning 50 used to be a signal to increase retirement savings, but times have changed as today’s generation face additional financial pressures that make this difficult.
He added: “As today’s 50-year-olds can expect to live for around another 30 years this poses additional challenges as savings will need to last a significant period of time and money must be carefully managed. It is crucial therefore that people put in place effective, long-term financial plans as early as possible to cater for the rollercoaster costs of life.”
More on financial planning:
Plans: your financial life in one secure place
Financial planning and financial advice explained
Couples over 40 failing to make financial plans for retirement