ABSTRACT
The last years of working life are crucial for consolidating resources for the retirement years, now potentially stretching for two or three decades. With the state pension an insufficient protection against poverty and occupational pension pots subject to market volatility, unlike the defined benefit pensions they replaced, later life financial risks were already high prior to Covid-19. The economic lockdowns increased these risks, particularly for those with the least financial resilience, as older workers experienced high levels of furlough and redundancy, long-term unemployment, benefit ineligibility, and sickness. Nearly a third of a million withdrew from the labour force altogether. Those who were over retirement age when Covid-19 struck were more insulated at first, but then struggled to manage its sequelae in the cost-of-living crisis and NHS capacity issues. Instead of building up savings, 50–65-year-olds began withdrawing funds from their pensions at an unsustainable rate. Relative poverty among 60–64-year-olds rose to 25% and older retirees began to change their financial behaviours, releasing pension funds and housing equity to meet day-to-day needs. With their prior plans knocked off course by events out of their control, the risk of later life financial vulnerability has been accentuated with potentially significant implications for future welfare spending.
