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Older parents left in mortgage debt

Christina Hoghton
Written By:
Christina Hoghton
Posted:
Updated:
13/04/2016

Over 50s who started a family later in life still have an average mortgage debt of over £80,000

Later-life parents are left in higher levels of debt than those who start a family earlier, according to research from Saga Personal Finance.

It said that one million over 50s are ‘second lifers’ – those who have a second family later in life following a previous marriage – and 20% of them still have a mortgage compared to just 12% of all over 50s.

The average mortgage debt of second lifers is also higher at £80,000, compared to £60,000 for those who had children.

Saga said that its research shows that having children in later in life is impacting the amount of debt people have as they get older.

As well as having a bigger mortgage to pay off, second-lifers are also more likely to have non-mortgage debts, such as loans. Around 18% of those with a second family have almost £12,000 of outstanding debts on average, compared to 12% of traditional families who have to find around £10,000 before they’re back in the black.

According to Saga Equity Release Advice Service some of these may be turning to the value in their property to help clear some of this debt, with around one in five people releasing equity from their home to pay off their mortgage, while one in three used the service to clear debt.

Jeff Bromage, chief operating officer at Saga Personal Finance, said: “Having children in later life keeps people on their toes and feeling young at heart. However, the cost of raising a child is continually increasing and these days people need to keep a close eye on their finances and make sure that they are getting the best deals, whether that’s when you’re borrowing money or investing it in the stock market.”