Dealing with debt in retirement

Dealing with debt can be terribly stressful at any time of life, but in retirement the stress can be worse than ever. Most retirees only have a finite income, so it's more of a challenge to deal with large outgoings or unexpected debts. However, if you take a little time to think carefully and tackle your debt responsibly, there's light at the end of the tunnel.

How can I get rid of my debts?

First of all, if you're reading this then you're doing the right thing: looking for help to reduce your debts. The next step is to work out how you can do that, and almost as importantly, how you can prevent those debts from building up again.

  • Draw up a budget
    The first thing to do is to start managing your money more effectively. Start by working out what your monthly outgoings are, so that you can begin to make cutbacks accordingly. To help you, why not take a look at our pages on effective budgeting.

  • Work out what savings you have
    If you have an ‘emergency’ savings fund, this could be the time to use it. That’s because you’ll save money on the interest you’re paying out on debts. And that should make it easier to save up again later on. 

  • See if you can move your debts
    If you have a credit card, you could potentially save money by shifting your debt to a lower or zero interest deal. It could also be worth consolidating your debts or paying them off with a cheap personal loan. If your debt is a mortgage, you could shop around for a better interest deal. For the best deals, take a look at

  • Talk to the people you owe money to
    It’s always best to be upfront about your situation and tell lenders or service providers that you want to work things out. Explain your position and ask for an acknowledgement that you have contacted them. You never know, they may have schemes in place to help you pay off your debts quicker. If you’re really worried though, you can contact debt charities such as Stepchange or National Debtline for advice.

It’s important to try to pay off your debts, but equally, you need to start planning how you’re going to afford things from hereon in. After all, the sooner you make lifestyle changes, the easier they are to get used to.