Older man sitting on a bench

Hardship caused by the pandemic is forcing many older people to delay retirement.

One in five people coming up to retirement expect to carry on working because of Covid-19, and there is a marked increase in working parents dipping into pensions to help children in the past year.

Last year more than half of those still at work thought their lifestyle would improve when they retired. This year that number has halved.

How the market has changed

These are some of the findings of a recent retirement survey of 12,000 adults undertaken by Interactive Investor.

This found that 21 per cent of people aged 60-65 are putting off plans to stop work because coronavirus has affected their pension fund, and 19 per cent of 66 to 71-year-olds who are still employed also intend to hold onto their jobs.

Some 25 per cent of those postponing retirement expect to wait a further year to stop, 34 per cent an extra two years, 23 per cent three years, 5 per cent for four years and 14 per cent for five years or more.

A quarter voiced fears that investment losses they had suffered in the coronavirus pandemic meant they would never be able to retire. UK stock markets have bounced from their lows early this year, but not fully recovered since the outbreak.

Meanwhile, 51 per cent of retired parents have already helped their children buy property, split by 41 per cent who gifted the money and 10 per cent who made a loan.

And 21 per cent of parents who are still working have already used at least some of their tax-free pension lump sum to help their children buy a home, compared with 14 per cent in last year’s survey.

Property market impact

House prices have experienced a mini-boom since the initial Covid-19 lockdown was lifted this year, defying forecasts that a pandemic recession would deliver a severe shock to the property market.

Meanwhile, lenders have pulled most deals aimed at buyers with small deposits, which is likely to put further pressure on parents to fund them.

Seek professional advice

When it comes to retirement planning, there are options available to savers and an independent financial advisor is well placed to evaluate individual situations.

For more information contact Becky Hammonds on 07969 269677 or email becky@willowfs.co.uk