Some over-50s ‘forced’ into bleak early retirement by pandemic
7th July 2023 00:01
by Alice Guy from interactive investor
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interactive investor comments on IFS report on living standards.
Interactive investor comments on the IFS research released this morning, (part of the upcoming IFS annual report on living standards, poverty and inequality), which paints a concerning picture of some over-50s struggling financially after the pandemic, likely forced to retire before they were ready during the pandemic.
Interactive investor’s Great British Retirement survey explores a similar theme on older workers leaving the workplace. Our research found that only one in three (34%) 56-to-65-year-olds still work full-time – close to half as many as those under 56 (60%).
Our survey also found that an astonishing number of older people are lost through illness. Overall, more than one in five (21%) of 56-to-65-year-olds cut their hours because of ill health.
Alice Guy, Head of Pensions and Savings, interactive investor says: “It’s extremely concerning that older people are having to cut back on food at a time when food prices are spiralling. Far from enjoying an affluent lifestyle in early retirement, they are surviving on a meagre income after being forced into retirement earlier than planned during the pandemic.
“It's a bleak picture as older people below state pension age who are not working are one of the poorest groups in society. Working-age benefits are much less generous than those available to pensioners who have reached the state pension age and so people who retire before aged 66 can find themselves living on a shoestring budget for many years.
“Old-age poverty is likely to become an increasing issue in the years to come as the state pension age climbs ever higher. Many people in their 50s and 60s have health problems and simply aren’t able to do a physical job anymore, while others have caring responsibilities or face an unexpected redundancy and find it hard to get back into work.
“Many of these older workers have little or no private pension provision as they worked most of their working life before the pension auto-enrolment rules forced all employers to offer a workplace pension.
"Women are even more likely to face poverty in old age as they often a have much lower private pension income on average than men.
“If over-50s want to return to work, one silver lining is the current booming jobs market. Older people have loads of skills to offer employers and with a many businesses struggling to recruit, employers may be more willing to consider applicants who have had a break or worked in a different industry.”
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