Covid threatens to push over-50s into poverty and risk having ‘to work until they drop’

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To make it through the pandemic, the number of over-55s withdrawing money from their pensions has jumped by 10 percent as they struggle to afford essentials, a Scottish Widows retirement report has found. They risk being plunged into a precarious retirement but may have no choice, the pensions provider has warned.

They risk being plunged into a precarious retirement but may have no choice.

As a result, more than half now fear running out of money in retirement.

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The report also says that 37 percent of over-50s have taken a financial blow during the pandemic, “more than any other age group”, they say.

As a result, at best, many have lost out by being unable to make pension contributions and others have detracted from their pension.

13 percent believe they will never be able to afford to give up work.

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Pete Glancy, head of policy at Scottish Widows, has called for urgent action before this group is “condemned to a work until they drop”.

READ MORE: Inheritance tax warning: More people being ‘forced to pay in full’ as Sunak eyes tax hike

Scottish Widows is calling for these rules to be suspended.

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“This should be coupled with action to create greater awareness of MPAA rules to ensure savers can make informed financial decisions”, Mr Glancy added.

“In addition, an auto-enrolment-type scheme for the self-employed, who have fallen through the cracks of state support during Covid would make a real difference.

“We also need continued signposting to financial advice, so that older savers know the true cost of lost contributions today, on their retirement plans for tomorrow.”

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Compounding this, the higher rate of self-employment in the 50-plus category, at 17 percent, compared to 12 percent of 25-49 year-olds, means they have suffered more from lower job security and issues in accessing government support.

While 25 percent of employees have suffered deterioration in their finances, no small number, a massive 50 percent of people who work for themselves have.

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