This year, the proportion of people retiring with debts is at its highest level in seven years, according to research by Prudential.
One in four people are set to retire with debts, up from one in five in 2016. This year's retirees, who still have debts, owe an average of £24,300.
This is an increase of £5,500 since last year and the first time retiree debt has grown since 2012 when the figure peaked at £38,200.
Credit cards are the major culprit as 51% of those with debt are in the red. Mortgages are the other big reason, as 38% of those expecting to retire this year still owe money on property, up slightly from 33% last year.
The research also found that those retiring in London are most likely to owe money (44%), while those in the West Midlands are the least likely (16%).
Women planning to retire this year with debts owe slightly more on average than men at £25,700 compared with £23,400. However, 28% of men expect to retire with debts outstanding, compared with just 21% of women.
Vince Smith-Hughes, a retirement income expert at Prudential, comments: "For most people the move from work into retirement will see them having to cope with a drop in their income. So having to use precious retirement income to pay off debts could make life even more tricky for the newly retired.
"People looking for free information on how to pay down as much debt as possible, preferably before the time comes to give up work, can contact Citizens Advice.
"The Government's Pension Wise guidance service can also be a good starting point for people preparing to give up work and thinking about taking an income from their pension savings."
Andrew Pennie, head of pathways at Intelligent Pensions, says: "The research from Prudential is deeply worrying and shows a growing number of people are likely to struggle financially in retirement.
"One of the big problems with retirement planning is that people invariably leave it too late to work out what they have.
"Most wait to the weeks before retirement to work out what their state and personal pensions can do for them and whether their overall financial position is sufficient to provide the standard of living in retirement they are hoping for."
This story was originally written for our sister magazine, Money Observer.