Steven Cameron, Pensions Director at Aegon, comments on how the cost-of-living crisis is affecting the financial plans of those approaching retirement age.

Workers in their fifties may be perceived as more financially secure than their younger counterparts and ‘looking forward’ to retirement in the not-too-distant future.

But individuals in this group are increasingly facing multiple challenges as they transition to retirement. Many may still have financially dependent children and increasingly may have frail and ageing parents to support.

Against the backdrop of high borrowing costs and inflationary pressures, one in five (21%) of those in their fifties have dipped into long-term savings, and one in eight (13%) have reduced their contributions to retirement savings. But doing so can seriously compromise future income with limited time to replace funds.

Steven Cameron, Pensions Director at Aegon, said:

While the pandemic and cost-of-living crisis have impacted all age groups, people in their 50s often have multiple financial pressures and are having to juggle priorities like never before. This is leading to mental strain and a lack of confidence in future finances.

For many in this group, every penny is a prisoner. One in every eight workers in their 50s (13%) is reducing or stopping their pension contributions. Others may be tempted to dip into their retirement savings to get by in the short term without fully appreciating the long-term implications – and in doing so may face tougher financial choices later in life. With over one in three (37%) feeling stressed about their current financial situation, we can picture the pressures on those in their 50s.

Full release: Aegon finds cost of living most challenging for 50-somethings

✉️ James Matheson, Aegon, James.Matheson@aegon.co.uk