Inflation: the purchasing power of retirees at its worst?

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The last two years will have put the wallets of those over 70 to the test. According to an OpinionWay* survey commissioned by the company Monetivia, 20% of them declare that they do not have, in 2022, sufficient assets and income to “live decently”.

One might think, however, that they are relatively spared from the crises: most are already retired, owners, without any dependent children. But in fact, they are actually on the front line of recent economic upheavals.

“Seniors are affected, because until recently, pensions were far from keeping up with inflation. The heart of the matter is also the cost of housing, which continues to rise. 72% of seniors are owners and face ever higher charges and taxes, so their situation is less favorable,” notes Thomas Abinal, co-founder of Monetivia, who commissioned the investigation. 77% of those polled think that their housing expenses have increased over the past two years.

More generally, 55% of seniors surveyed by OpinionWay say they are currently facing financial difficulties that impact their daily lives. This is 6 points more than in 2020.

86% are also particularly worried and fear that their purchasing power will decrease further due to inflation. “Compared to the scores of two years ago, the difference is significant”, measures the co-founder of Monetivia. “On some answers, in terms of the evolution of scores, we are 10 points apart”.

To cope with this increasingly precarious situation, retirees have confided that they intend to limit their holidays (for 60% of respondents), or that they are already giving up certain food products when shopping (for 47% of them).

Another alternative considered by 36% of the subjects of the study: freeing up cash from their home, by selling, for example, their house to buy a cheaper one. “15% say they are ready to sell their home in the traditional way to buy cheaper! The propensity to consider housing, renting or selling has increased. These are solutions felt to be relevant today”, explains Thomas Abinal, whose company also specializes in real estate and asset engineering. For him, “there is something to be done in terms of real estate optimization to allow seniors to gain purchasing power”.

*This study was carried out on a sample of 1,304 people, including 1,037 owners, representative of the French population aged 70 and over, constituted according to the quota method, with regard to the criteria of sex, age, socio-professional category, urban area category and region of residence.

In France, according to the annual report of the DREES (Research, Studies, Evaluation and Statistics Department), the average retirement pension received by new retirees in 2020 amounted to 1400 euros net. A nest egg which, sometimes, is not enough.

The OpinionWay survey for Monetivia assures that 38% of the over 70s questioned believe that they do not have enough wealth or income to have fun. This is 7 points more than 2 years ago.

Women are even more affected: 25% say they don’t have enough, compared to 14% of men.

What do they lack to live properly? The not insignificant sum of 626 euros every month (7500 euros per year), according to the study.

And the situation is definitely worse than two years ago, it could also… get even worse, respondents fear. When we launched the study this summer, we were starting to have this intuition, the climate was already very anxiety-provoking. The situation has gotten even worse in the meantime,” notes Thomas Abinol.

The survey highlights the following concerns, among others, among those over 70:

“There has been a lot of negative communication in recent months around inflation, the cost of energy. We were told that it was going to be hellish, and the media noise has an effect on people’s morale”, tempers however Thomas Abinal. For the co-founder of Monetivia, difficult, in such a context, to remain optimistic.

“However, the results of the survey do show, to a certain extent, that they are more worried, pessimistic. It’s a feeling more than a scientific photo, but their perception there too has evolved in a negative way”, summarizes t -he.