Older workers delay retirement because of pandemic

Older Wokers

New research by merchant banking group Close Brothers has found that one in five older workers in the UK have had to delay their retirement because of the current pandemic.

The survey of 2,000 workers uncovered that 19 per cent of those aged between 65 and 75 and also that 14% of those aged between 55 and 64 said they would need to put off their retirement as a result of the pandemic.

In a similarly worrying trend, 20% of over 65s said they don’t have accessible emergency savings, with the same percentage saying they were not financially prepared for the pandemic.

With the news that two-thirds of workers who have been laid off during the pandemic were under 25, it can be easy to think that the impact of the pandemic is mostly affecting the young.

Whilst the under 25s have been hit hard by levels of unemployment, older workers have not been left unscathed.

Towards the end of 2020, it was reported that the number of over 50s out of work increased by 33%, which is sure to have affected their savings for retirement.

Others who have kept their jobs may be forced to carry on working past when they planned to retire due to falling investment markets adversely affecting their pension pot.

Whilst losing a large number of over 50s from the workforce at once can cause a loss of valuable skills and knowledge, too many people working on past retirement could have consequences for young people looking to kick off their careers.

Fewer older workers exiting the workforce could mean that there are fewer progression opportunities for younger workers with the knock-on effect that they are kept in entry-level jobs for longer making it that bit harder for school leavers and university graduates to find a role in their desired career.

Unbiased, a site that connects users with financial advisors, also recently found that one in three people in the UK do not know how much they will need to save for retirement.

It also found that one in five is unsure of how much they have saved already.

No one could have predicted the pandemic or its impact, but it does highlight the importance of financial education, particularly when it comes to pensions.

Employers should now be looking to ensure that human resources teams are regularly engaging with staff about their pensions as many people don’t fully understand how they work or how much they will need to save for retirement.

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Posted on April 9, 2021