Employers ignoring retiring workers due to coronavirus

Employers are not helping staff once they approach the age they can claim their pension, according to new research by financial planning and retirement savings business Punter Southall.

According to its Financial Wellbeing Survey 2020, six out of ten companies (61%) surveyed said they did not offer any guidance on steps to take as people reached 55 when they can legally unlock some of their savings.

Punter Southall said that the research is vital as the COVID-19 pandemic has forced many people to rethink retirement.

This backs up an Institute for Fiscal Studies report which found a third of UK employees are worse off financially and one in 10 are planning on working for longer than they had originally intended to.

The report also detailed that only 1% of employers feel it is their duty to provide education and guidance to employees in order to support their financial wellbeing.

Further reading:

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Pandemic forces early retirement in over 50s

Why it pays to be an age-friendly employer

Employers reconsider financial wellbeing for employees post-coronavirus

Speaking to HR magazine, Peter Selby, managing director, retirement services at Punter Southall Aspire said: “Around half the companies we surveyed already provide some financial education or support to their employees, yet, when it comes to retirement planning this figure drops to 39%.

“This is baffling as the over-55s are at a key stage in their life, as they can withdraw their pension and are likely to be planning their future retirement.”

Selby said he thinks now would be the perfect time for employers to support over-55s with financial education.

“Employers should provide an introduction to a financial planner, who could help them make astute and informed financial decisions, plan their retirement and avoid costly mistakes they may later regret,” he said.

If an over-55 employee wanted to retire and could not afford to do so, an employer not offering any financial education support could have a negative impact on the employer as well as the employee. Shelby added: “Just as companies offer pensions support to all employees, pre-retirement planning should be a key part of their financial wellbeing programme.

“It doesn’t have to be complex or expensive and it will ensure that employees feel supported throughout the duration of their employment and they can retire well.”