Key: 24% retiring early due to COVID
Almost one in four (24%) people retiring this year have stopped work earlier than intended due to the COVID-19 pandemic, according to Key.
Nearly one in six (16%) said the pandemic convinced them to retire earlier voluntarily, but 8% said they were forced to stop work earlier than they intended.
Women were more likely to retire earlier than men – around 18% were found to be stopping work voluntarily, while 8% had been forced, compared with 15% and 8% of men, respectively.
Key’s ‘Retirement Ready’ study, now in its second year, explored the finances and ambitions of people planning to retire each year.
It found that 59% have felt the impact of the COVID-19 pandemic on their plans.
While the biggest impact has been on early retirement, 11% said they now plan to work part-time, while another 14% said the pandemic has made them change their retirement ambitions and priorities.
Just under one in 10 (8%) of those expecting to retire this year said their retirement income is lower because of the impact of the pandemic, while 4% said they have more debt as a result, and 4% have had to help out family with their finances.
People retiring this year in the East Midlands (39%) were the most likely to be doing so earlier because of the impact of the pandemic, with East Anglia (32%) also seeing higher than average levels of early retirement.
In contrast, the North East (18%) an South East (20%) have experienced the lowest levels of early retirement.
Will Hale, chief executive at Key, said: “The pandemic has been a hugely uncertain time for most people but especially those who need to make the big decision about how and when to retire.
“Some have reassessed their priorities and decided to stop working sooner than imagined while others have lost their jobs or been made redundant – an issue that the end of furlough will only exacerbate.
“While fewer people than you might imagine said COVID has impacted their retirement income, the end of furlough is also likely to hit some people hard – especially if they planned to keep working until they had built up their savings or repaid their mortgage.
“Should this happen, it is vital that they seek financial advice in order that they can explore how to make the most of all their savings and other assets as they plan for later life.
“Whether it is getting support to track down any old pension pots, ensuring they receive all the benefits they are entitled to or considering what role housing equity can play– there are plenty of options open to most people that, if properly considered, can help to make things easier.”