Over-50s redundancy risk hits pension planning
Its analysis of Government data show the chances of returning to work after redundancy for the over-50s has dropped to a two-year low with just 26.7% of older workers made redundant finding new jobs quickly.
Over-50s workers made up the largest percentage of those made redundant in the first three months of 2015 – around 35% of those made redundant were aged 50-plus compared with 33% of those aged 35 to 49 and just 15% of those aged 25 to 34.
Workers aged 35-49 have double the chance of a quick return to work, Government data shows, with 55% returning to employment after three months.
The effect of redundancy on retirement planning is believed to be another factor driving increased use of equity release plans – around one in five equity release customers are currently aged between 55 and 65.
Bower is urging those aged 50-plus who are made redundant to seek financial advice on their retirement planning and looking at all their assets including property wealth as well as pensions.
Andrea Rozario, chief corporate officer at Bower Retirement Services said, “The economic recovery is well-established but it can still be tough to find another job and particularly so for those aged 50-plus.
“Ideally, people in their 50s should be gearing up for the final push for sorting out their financial planning come retirement, so being made redundant can be particularly damaging, especially if getting back to work takes a long time.
“The rise in younger customers using property wealth is being driven by a range of factors including the new pension freedoms as well as issues with interest-only mortgages, but the impact of redundancy is another risk.”
Government data shows around 3.2% of those aged 55 to 64 are classed as unemployed men (3.3%) are slightly more likely to be unemployed than women (2.9%).
However, 3.349 million over-50s are classed as economically inactive – the equivalent of 28.3% of all those aged 50 to 64. Among those aged 35 to 49, that falls to 13.1%.
Anyone looking to access the wealth in their home can get Bower’s equity release guide by calling 0800 411 8668 or visiting http://www.brsequity.co.uk/free-equity-release-guide