Thousands of pensioners are stuck in a cycle of debt, with many owing more than £50,000, a report warned yesterday. Insolvency experts said 'unscrupulous' lending by credit card companies is dragging growing numbers into taking on debts they cannot afford.

And many others are being targeted by mailshots offering bogus prize draws and other scams which dupe them into sending money to win prizes which don't exist.

NancollasGreer, a firm which offers debt advice, said that of those who approached them, the over-60s had bigger liabilities than any other age group. With an average debt of £52,000, they owed more than three times the £15,000 owed by under-30s.

The oldest person who had come to them for advice was an 80-year-old woman who had debts of £30,000. The company said debt was a much bigger problem for the elderly, who are mostly on fixed incomes with little chance of earning a good wage.

While younger people are able to get a better job or promotion to help them repay loans or credit cards, pensioners are stuck with few such options.

Sarah Nancollas, founder of NancollasGreer, said: 'I have seen some really sad cases of retired people who have found themselves stuck in a cycle of debt and have no way out of it.

Many are embarrassed by their financial problems and don't tell their families because they don't want to be a burden. A lot of them are scared of leaving massive debts for their loved ones to pay off but simply have no means to repay the money they have borrowed.'

The firm's figures are for unsecured debt and do not include mortgage borrowings. Nearly 70% of pensioners have a credit card, according to the trade body the Association of Payment Clearing Services. Of these, nearly 15% have four or more credit cards.

And some credit card companies are setting pensioners' credit card limits at three times above the average, according to a recent report by BBC Radio 4's Money Box programme.

Pensioners are also vulnerable to the bogus 'prize draws' which drop through their letter box every day.

David Sinclair, policy manager at Help the Aged, said: 'As soon as someone pays the first £20 to 'guarantee' a prize which does not exist, they get put on a list of people who will fall for this sort of thing.'

The charity has heard from many vulnerable elderly people who get 'tens, even hundreds' of offers through their letter box every week.

Mr Sinclair said: 'There is a culture of trust among older people and a sense of duty about responding to 'official' letters.'

Mark Neal, managing director of Economic Lifestyle, the retirement housing specialist, said: 'We regularly see clients who are heavily in debt. Generally speaking, they are not senselessly running up debts - they are simply doing whatever they can in order to survive.

'Credit card and loan companies should perhaps take more consideration when offering credit to older customers.'

Mounting debts are forcing many more pensioners to work beyond the state pension age, currently 60 for women and 65 for men. A record 1.1m pensioners are working, a number which has jumped by nearly 150,000 over the last two years.

Many are 'part-time pensioners' who work a few days a week but are able to enjoy their retirement for the rest of the time.

£130,000 owed on 23 credit cards
RICHARD Cullen took his life after running up more than £ 130,000 of credit card debt. The 65-year-old grandfather borrowed the money over six years using 23 cards, four from the same bank.

He first used the cash to pay household expenses when he took time off to care for his wife Wendy, who had breast cancer. But the debts spiralled out of control as the interest charges mounted and he was forced to borrow money on one card to meet the payments on another.

In the run-up to Christmas 2004 he was being bombarded with letters and phone calls from debt collection agencies, sometimes up to 20 a day.

Until then the self-employed mechanic had managed to keep his financial problems a secret from his wife. It was only after his death in January 2005 that she discovered their full extent.

Mr Cullen was found slumped in his car with the engine running in the garage of the couple's home in Trowbridge, Wiltshire.

Mrs Cullen blamed 'greedy' credit card companies for her husband's death. She said: 'These credit card companies don't care about the effect they have on people's lives. It's such a mess.

'He told me we were in debt but I didn't know it was anything like £130,000. He even cut up ten credit cards in front of me and said he'd never use them again.

'He was such a proud man, he didn't tell anyone the trouble he was in. If only he'd told me, we could have sorted it out together.'

Mr Cullen borrowed from companies including Barclays Bank, where he had four cards, and Tesco, on whose card he had a £10,000 balance.

Copyright © 2005 First Mortgage Trust