Oldies trapped in decade of debt stress

Alex Druce
(Australian Associated Press)

 

It’s been a decade of older people becoming trapped in the rental market, with credit card bills increasingly eating away their retirement cash, and a more urgent need for a financial counsellor to help them get on top of things.

The Salvation Army says findings from 10 years of financial counselling data is evidence government needs to fix housing affordability and loan ethics.

Salvation Army Moneycare financial counsellor Kristen Hartnett said National Anti-Poverty Week was a chance to bring the community’s attention to a decade-long rise in the number of older residents needing help because of debt.

Ms Hartnett said there had been a 37 per cent increase in people aged over 55 accessing Moneycare over the past 10 years, with the number of senior Queenslanders using the service more than doubling.

“They’re carrying more debt on credit cards into that age, and along with everyone else, are experiencing increased housing stress,” she said.

Young people, meanwhile, are increasingly falling victim to predatory payday loans, with the number of these types of loans doubling, and the amount handed out tripling.

Ms Hartnett said it was a sign government needed to act on long-held plans to legislate stricter controls on payday lending.

“People who are already in financial difficult circumstances… are then paying the highest interest rate to attend a pressing need in front of them,” she said.

“We know they access the loans sometimes to pay the rent, because it is a matter of them finding somewhere to sleep for the next week for their family or not.”

The Salvation Army’s data also showed disposable income has stagnated for a decade, while credit card debt has increased, and remained the most common source of debt among Australians.

Ms Harnett said the common stereotypes of the people accessing financial counselling services were irrelevant, with four in 10 finding themselves in a desperate situation because of non-financial issues.

“There’s many non-financial reasons… it could be the loss of a partner, breakdown of a marriage, loss of health,” she said.

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