KEY POINTS:
It will be a lean winter for Ian Anderson and many others like him as the plunge in bank interest rates means the elderly will have to tighten their belts.
Mr Anderson, in his mid-70s, said the significant drop in interest rates would mean many elderly people would be facing hard times.
With many retired people living on superannuation and having invested in their bank to get supplementary income, then having that income drop significantly or taken away completely, was a hard reality for many elderly, Mr Anderson said.
"A lot of people - fortunately we're not in that boat - have lost their capital with the financial institutions going under.
"They were getting an income from those investments to supplement the superannuation," Mr Anderson said.
"The safe place to invest any money [was] supposedly the bank, and now the bank interest rates are almost non-existent, so we really have no supplementary income to add to our superannuation.
"It's going to be a very lean winter up ahead."
Mr Anderson said he and his wife receive around $28,000 a year from their superannuation. But those living alone get around $14,000 a year.
Because superannuation was "very little" to live on, Mr Anderson said, a lot of elderly people depended on their bank investments.
"We have no means of topping up our income and the cost of living is still going up. The cost of essential goods is going up."
Mr Anderson said there would be a lot of cutbacks in spending this year, with "flash trips and cruises" taking a back seat.
