A "toxic combination" of low interest rates, spiralling inflation and the Bank of England's quantitative easing (QE) policy has hit over 50s spending power, Saga has said.
The 50s campaign group said 21 million older Britons have seen their spending power slashed 9% in real terms over the past four years as a direct result of the Bank of England's policies, The Times reports.
Saga said QE had forced many older people to cut back on essentials, as they reassessed their financial situations in response to the rising cost of living.
It said this had in turn cost the economy £24.7bn - the equivalent to a 1.6% fall in GDP.
Ros Altmann, director-general of Saga, said: “This age group represents more than half of UK households and contributes nearly half of all domestic consumption, but the toxic combination of rock-bottom interest rates, spiralling inflation and QE money-printing has put a big squeeze on their incomes, forcing many to make cutbacks.”
Saga said over-50s have been affected more than other age groups as they failed to benefit from lower interest payments on mortgages and because QE reduced income from savings significantly.
Falling gilt yields have also hit pensioners and the hundreds of thousands of retirees buying annuities, it added.
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First mentioned in Cridland Report
Second acquisition of 2019