Inflation is now at 3per cent, the highest it has been for 11 years. Pensioners will be the hardest hit as the costs continue to rise for basic necessities. The price of gas, electricity and food has risen considerably over the past year and pensioners should now be tightening their belts. The increase in inflation will have less of an impact on the younger generations as the cost of clothing and audio visual equipment is falling.
However, not only does the increase in inflation mean higher prices, it also means that their pension funds are not providing as much as they thought they would. A non-indexed linked pension for a person retiring at 60 would be halved by the time they reached aged 83, and so reducing the amount of disposable income they have available.
Our view
Britain is now one of the worst offenders for increasing inflation and keeping inflation down is a key fact in avoiding poverty for the elderly and to allow those that have retired to enjoy life. This just highlights the real need for people to save for retirement in a decent pension.