The Covid-19 pandemic has sparked a surge in people over 50 seeking professional financial advice, according to new research from Scottish Widows.
Almost half (46%) of Independent Financial Advisors (IFAs) in the UK have reported an increase in the number of over 50s reaching out to them for help over the last 18 months.
Some over 50s have been hit by a volatile stock market, furlough and job losses, plus low interest rates and fears of a deep recession. At the same time, others have enjoyed the off-setting benefits of the pandemic with enhanced savings and decreased living costs. Despite these opposing fortunes, this context is driving more over 50s to seek professional financial expertise.
Most commonly, people aged over 50 are asking for advice on pension planning (56%), early retirement (54%), part or phased retirement (53%) and accessing their pension at the point of retirement (53%).
Financial adviser Matt Pathmanathan, who works for AMG Wealth Solutions, commented: “In my whole career, I have never received so many enquiries from those in their fifties as over the last 18 months. The pandemic has given this age group an opportunity to get off the hamster wheel of life and take stock, providing them with unprecedented time to think about their futures and their retirement plans.
“Whether they are enjoying their job or not, those aged over 50 are considering all options – how many years they have left before retirement, and for some even whether they can retire early. We help clients make sense of it all, acting as a kind of comfort blanket in helping them make decisions with a full understanding of the financial ramifications.”
HR decision makers report a similar story, citing a sharp increase in the number of workers aged over 50 asking about their workplace pension and retirement plans during the pandemic.
More than half (52%) have seen an increase in requests for information about pension savings levels and estimated income in retirement. Two in five (44%) report a rise in employees asking to increase their pension contributions.
There’s also more interest in the performance of workplace pensions. Almost half (46%) of HR decision makers say they’re seeing more people in their 50s looking for a greater financial return on their pension investments following the pandemic. At the same time, there is growing interest in green and ethical investments within this age group, with more queries about investments in ‘green’ companies (44%) and ethical issues (42%).
In fact, the pandemic has prompted many over 50s to reconsider their retirement plans altogether. Almost half (46%) of HR decision say more employees in this age bracket are asking about taking a phased approach to retirement, while the same proportion (46%) have seen an increase in requests to delay their planned retirement date.
Siobhan Barrow, Head of Intermediary Distribution at Scottish Widows, said “A sudden shift in financial status can often feel overwhelming. Money worries cause people to experience difficulties in lots of areas in their lives, from their physical and mental well-being to their personal relationships. Even those seeing an unexpected uplift in wealth may be confused about how they should feel and respond.
“Pension Awareness Day is a good prompt for people to start thinking long-term and seek solid financial advice, no matter whether they’ve experienced financial challenges or opportunities over last 18 months. It’s encouraging to see many over 50s open enough to speak to others and take positive action, like increasing pension contributions. Your fifties is the critical time to get finances organised and we must ensure more people, of all ages, feel comfortable seeking out professional advice.”