The latest research from Callcredit, a credit reference agency, has shown more than 1.1 million retired UK homeowners have an outstanding mortgage averaging £38,000.

Callcredit also found one in eight people in this age group owe more than £50,000 on their mortgage, putting increased pressure on retirement income.

The situation is little better for those with short-term debt, such as credit cards and personal loans, according to Callcredit. Almost one in three have carried over such debts for each of the last three months, with an average outstanding balance owed of £5,900. In addition to this, 16 per cent of over 55 year olds have no idea how much they owe.

As a result of all this debt, more than 1.5 million people in this age group claim they can’t afford to retire at state retirement age due to lack of pension savings.

Mark Ward, consumer debt expert at Callcredit, said: “It is essential that people start to borrow more carefully in order to avoid having to owe more than we are able to pay back.

“We must be better aware of how to take control of our financial life.”