A Telegraph headline this week – “Take your mortgage to the grave” – simply articulated what has been obvious for some time now, writes Tony Watts OBE. Huge numbers of people in their 50s, 60s and beyond may well have assets in the form of a house and pension, but they are also carrying significant amounts of debt which they can’t afford to service.

The solution many are looking at is to pay interest only mortgages – if that’s a deal a  lender would agree to. Around 1.3 million people in this position are said to be sitting on a “time bomb” (their cliché, not mine). Many are struggling because the endowments they were sold years ago haven’t performed. Others have simply remortgaged and remortgaged again along the way – funding children through universities or simply following them to live off the increasing market value of their homes.

The latest findings are backed by plenty of other surveys. Last year, research by Age UK and the International Longevity Centre estimated that over a million older people had what they described as “problem debts”. Boiled down to basics, planning your finances in later life is all about making sure we have enough to live on decently until, in the immortal words of Monty Python, we drop off our perch. And the last few generations have seen huge shifts in how we deal with that.

Often those born before and during the War are characterised as being more careful during life… building up capital in the form of savings and their home, and not spending what they didn’t have… living frugally and looking to pass on their assets to the next generation.

The “baby boomers” are characterised as being more than happy to spend now, pay later. They’ve been encouraged by lenders… as well as Governments who have been only too pleased to see borrowing and spending booms fuelling our GDP.

This isn’t the place to ponder upon the wisdom of funding today’s lifestyle with tomorrow’s repayments: it’s how the developed world is now run. If we stopped to worry about the trillions of debt we and other nations carry, our heads would probably explode. I’m reminded of how Arthur Dent discovered how to fly: you have to miss the ground accidentally and not be distracted by anybody noticing you and saying things like “Good God, you can’t possibly be flying”.

Managing nations’ debts is the preoccupation of some of the biggest brains on the planet. Ordinary people just have to get on with their own borrowings. And it’s illuminating to see that by far the biggest sections of advice websites like Money Saving Expert are given over to people (of all ages) concerned about debt.

It’s why so many RetireEasy subscribers have told us they diligently play all the different scenarios on our software – ringing the changes to see how best they can balance outgoings and income in the years ahead. “What happens if I pay down this debt…get a part time job…  downsize… or stop making these payments…?”

Two of the killer nuggets of information in the first RetireEasy Index are that 31% of subscribers have pencilled in downsizing their home as a real option in retirement; and that just 12% have made any plans to pay for their care in later years.

The reality for a large swathe of people in or entering retirement is that the home is by far the biggest asset we have, and the asset that we may well need to fund our care, boost our pension or keep our car on the road.

How we harness that asset is the £64,000 question. Many look to equity release (one option, but not without its pitfalls); others – as we’ve just been discussing – look to interest only mortgages (much cheaper than credit cards and loans); for some there is the option of selling the family home, paying off remaining debts, investing in a safe, secure income and renting rather than buying – ideally on a lifetime lease.

Whichever route is taken, the likelihood is that many people in the next generation won’t be inheriting – something that has become almost an expectation in recent years.