One in five older workers were forced to delay their plans for retirement due to the Covid-19 pandemic. According to new research, 19% of employees aged between 65 and 74, and 14% of those between 55 and 64, had to delay their retirement plans.
The research from Close Brothers also found that one in five employees approaching retirement age admitted to not having a cash savings emergency fund in place. The report, called ‘Expecting the unexpected: a spotlight on preparing for a crisis’, looked at the extent to which the last year has altered the financial plans ofemployees in the UK.
Despite a general lack of preparedness identified in the report, only 5% of employees aged 65 to 74 recognised they were financially unprepared ahead of the onset of the pandemic last year. That level of financial unpreparedness rises to 16% for 55 to 64 year olds.
Across all employee age groups, 19% of workers in large businesses said they were financially unprepared for the Covid-19 pandemic, with younger workers found to be much less prepared than their older counterparts.
Almost a quarter of 18 to 34 year olds admitted to being financially unprepared, with 13% of those aged 55 and over saying the same.
At the one-year anniversary of the first lockdown, many of us have been reflecting on what we would do differently, and this reflection should include thinking about our levels of financial preparedness. 38% of employees in the 65 to 74 year old group either already have or plan to make changes to their financial preparedness.
This proportion of those determined to build their financial resilience back strong post-pandemic is, however, lower than the average across all age groups, at 56% either already making some changes or planning to do so.
One in three UK workers are confident about their ability to weather a fresh economic crisis, when compared to their confidence levels before the pandemic.
Jeanette Makings, Head of Financial Education at Close Brothers, said:
“The COVID-19 pandemic risks being a ‘sliding doors’ moment for UK employees and their employers. It has impacted financial health in a multitude of ways, with some suffering hardship, some having to postpone long held plans and others benefitting and adding to savings.
“At the forefront of those best able to help employees improve their financial health are their employers; they are trusted, they can reach large numbers of people via the workplace, they already offer rewards and benefits that can be used to improve financial wellbeing and both employee and business performance will benefit from improved financial health.
“Understanding employees financial health as a whole, and knowing those that need most help, has to be the starting point to ensure that an inclusive, effective, and targeted financial wellbeing programme is implemented. A single channel,‘one size fits all’ financial wellbeing approach is likely to fail many.”