An average of one in three will retire in debt this year, but for those living in Wales, there’s a near one in two chance they will start their golden years owing money.

The research from over-55s specialist adviser, Key, reveals that those living in the North East are saddled with the most debt at an average £22,900, ahead of Londoners (£18,600) and those in the South East who are £22,400 in the red.

Some 8% of the 1,000 people polled owe more than £20,000 and 4% don’t know how much they owe.

Key found that 48% of people still owe money on credit cards, 31% have outstanding bank loans and 14% are still paying off their mortgage.

While the ‘Retirement class of 2020’ expects to clear their debt within an average of three years, one in eight think they’ll be making repayments for nine years or more. A third say they will never pay back the money owed.

Key found that a third of people will only start making plans for retirement within a year of their intended finish date despite the State Pension Age due to increase to 66 for men and women this year.

Will Hale, CEO at Key, said: “With changes to the state pension due to start coming into effect this year, it is vitally important to understand the challenges and aspirations of the “retirement class of 2020”.  Today’s findings suggest that while most people work hard to retire debt-free, this is not the reality for one in three people who need to consider how they can service and repay over £17,000 in borrowing from their retirement nest egg.

“Even those with generous incomes may find this a stretch and people are taking an average of three-and-a-half years to clear the debts they retired with – at a time when they should be enjoying an active retirement and worrying less.”