Covid-19 job cuts cause over 55s to re-think retirement plans
Nearly four in ten (38 per cent) Brits over 55 say Covid-19 has made them more worried about their job security, according to new research by Standard Life. That equates to an estimated 5.8 million people over the age of 55 feeling a sense of job insecurity in response to the pandemic.
This climbs to more than half (52 per cent) of those living in London, 45 per cent of those living in the South and 42 per cent of those living in the North West (42 per cent).
By comparison, those in the South West are the least worried, with around a quarter (27 per cent) stating they are concerned about job security.
As a result of the pandemic, a third (32 per cent) of the 1,000 over 55s polled would opt to give up work altogether earlier than planned if they were made redundant in the next 12 months.
Meanwhile one in seven (15 per cent) would choose to look for another job because they enjoy working rather than not being able to afford to stop, and one in 20 (5 per cent) say they’d like to set up their own business.
The research also found that over a third (36 per cent) of over 55s would look for another job if made redundant, because they don’t believe they could afford to retire now. This figure rises to 45 per cent of those under the current State Pension age of 65.
John Tait, Planning Specialist at Retirement Advice from Standard Life, says: “While support measures have been put in place to curb unemployment, we’ve regrettably seen a raft of redundancy announcements as a result of Covid-19 with huge speculation that more announcements will follow in the months ahead.
“Those nearing retirement are understandably feeling particularly concerned about job security and are looking for reassurance and support when it comes to saving for the future. But our research and experience of working with clients in this situation has found that for some a redundancy could provide an opportunity to change or even accelerate their retirement plans.
“While the process can feel daunting, there are a series of steps people can take to adapt their plan. The best place to start is pulling together a view of all their potential retirement incomes, pension pots and savings. When you have this, you can work with a professional planner to get an accurate projection of the retirement income and lifestyle that is possible.”
Yet despite the insecurity felt by over 55s, Standard Life’s research reveals two thirds (65 per cent) have no intentions to seek financial advice in relation to the impact of Covid-19 on their retirement plans. Less than one in ten (9 per cent) have asked an existing financial adviser for extra guidance.
Meanwhile, the research also found that the three biggest personal finance concerns for the over 55s are being made redundant, losing value off their savings and investments and earning less.
Tait says: “While we’ve seen an increase in people seeking retirement advice as a result of Covid-19, it’s alarming to learn that so many have no plans to seek professional help with future planning.
“Unfortunately, many are still unaware of the benefits for them of seeking advice or guidance and believe it’s not suitable, or necessary for them. We need to do more as an industry to show that seeking advice or guidance doesn’t have to be complicated or daunting, or excessively expensive. It should be an accessible option potentially enabling greater choice and flexibility in retirement.”