12th November 2013
Energy prices mean that the over 75s face the highest rate of inflation compared with other age groups and that is before the latest price rises according to Alliance Trust Savings.
This group has suffered the highest rate of inflation since the start of the year as they spend a larger share of their budgets on basic goods such as gas, electricity and food. The 50-64 year olds face the lowest rate of inflation at just 1.8%.
Alliance Trust’s monthly study of inflation rates affecting different age groups found that every age group saw their inflation rate fall over the month – and CPI has now fallen to 2.2% but it is still the over 75s who face the highest rate of inflation at 2.5%.
This age group has been hit the hardest because it spends a larger share of its budget on household energy. Gas price inflation is running at 8.3% and electricity inflation at 8.6%.
The recently announced energy price hikes are due to kick in from November, so inflation rates in these categories may move even higher next month, disproportionately affecting elderly households even more.
The 50-64 year olds experienced the lowest rate of inflation, at 1.8%, as they spend the largest proportion on petrol and are benefitting from the drop in fuel price inflation. In October, petrol prices were down more than 4% from a year ago.
The youngest age group, the under 30s, experienced the largest fall in inflation over the month – their inflation rate fell from 2.7% to 2.1%. The main driver was lower inflation in the tuition fees category, from over 21% to 10%. This partly reverses the sharp increase in the inflation rate of this category in October 2012 due to the hike in tuition fees.