Joint research carried out by the firms analysed data from the Bank of England NMG’s survey and the Wealth and Assets survey.
The research predicted that the total amount of debt owed by the over-55s would rise to £294bn this year, up from £272bn in 2021 and £209bn in 2017.
This would amount to a 41 per cent increase in five years and is expected to rise to £402bn by 2032, a surge of 92 per cent in just 15 years.
Most of this debt is held by those aged between 55 and 64, who are still working while repaying mortgages and supporting children.
The total debt held by this group is expected to rise from £196bn in 2021, to £210bn in 2022. Half of 55 to 64-year-olds said they were currently in debt or had been in the past five years, equating to 4.4m people.
Unsecured debt amongst the over-55s grew from less than £20bn in 2015 to over £25bn in 2019 but contracted slightly between 2020 and 2021 as a result of the pandemic.
The research predicted that unsecured debt is likely to rise by over a third in 2022, reaching £20bn, as the cost-of-living crisis drives many to borrow to make ends meet.
Almost 40 per cent of retirees said they have spent more than they receive in income in some months in 2022, with eight per cent saying this often or always happens.
Credit card debt
The average credit card debt of those with debt stands at £2,800 and other types of unsecured debt levels are expected to reach an average of £10,700 per individual with debt.
More than one in five, 22 per cent, of over-55s revealed they had credit card debt in the past five years which they had not paid off in full each month, equating to 4.7m people.
The second most common type of debt was an overdraft, with nine per cent saying they had used their bank account’s debt facility to fund additional spending.
Dave Harris (pictured), chief executive at More2Life, said debt was a fact of life for many people.
He added: “However, with 40 per cent of retirees already finding that their monthly outgoings outweigh their income, it is likely to quickly become a burden for some as the cost-of-living crisis continues.
“Over-55s are expected to borrow £22bn more than they did last year which is likely to be driven by higher interest rates and rising inflation. Servicing this borrowing will have an impact on those older people who are already on fixed incomes and may be providing some financial support for their families.
“While individuals need to consider how best to manage their own finances as they get older, it is vital that they consider all their assets. Living in a property you own but being too scared to turn the heating on and dreading a visit to the supermarket makes no sense at all.
“Specialist advisers are ideally placed to help people explore all their options and understand whether a later life lending product such as equity release might be the support they need.”