Research from the Institute of Student Employers (ISE) has revealed that the UK’s cost-of-living crisis has drastically affected students, with 50% of 177 employers experiencing a surge in graduates and apprentices leaving their positions due to dissatisfaction with pay.
This statistic is an increase compared to previous years as only 40% left their roles in 2023 and 2022, with just over 25% moving in 2021 and 2020. ISE’s research suggests that the UK’s poor economic conditions have forced those entering the workforce to prioritise higher pay over career progression, with a notable shift in job sector preferences to higher-paying sectors like finance. This comes as no surprise to Senior Capital – the UK’s leading later-life asset platform, as higher-paying jobs will allow more young Brits to contribute to their pensions which have been devastated during the UK’s recession.
Senior Capital can reveal that 35% of Brits are currently unable to fund their future retirement, highlighting the brutal impact the cost-of-living crisis has had on Brits’ ability to contribute to their pensions. With disposable household income per head predicted to decline by 1.5% according to the Office for Budget Responsibility (OBR) in 2024, Britain’s recessionary climate has seen the cost-of-living crisis force 32% of the nation to halt personal contributions to their pension pot. Senior Capital’s research additionally found that this recent financial strain has forced 21% of individuals to postpone retirement and continue working, fearing they lack sufficient funds in their pensions. The ramifications extend beyond financial concerns, with 25% reporting that their greatest mental health burden stems from worrying about funding their retirement. Additionally, 37% express profound anxiety about their quality of life diminishing due to inadequate savings. These figures underscore the pressing need for comprehensive measures to address the escalating cost-of-living and its profound impact on retirement planning in the UK.
The rise of equity release
Amidst this new wave of pensioners who find themselves living on the poverty line, equity release loans have experienced a record 23% year-on-year increase as a vital lifeline amidst the cost-of-living crisis. According to the Equity Release Council, over 93,000 Brits took out this type of plan/loan in 2022. To create financial liquidity, stability and a better quality of life, Senior Capital was created to serve a growing number of homeowners looking to access capital from the £800bn currently tied up in property wealth.
Managing Partner of Senior Capital, Rudy Khaitan, comments on the benefit of accessing capital for those approaching retirement age through equity release products: “In today’s society, many over 55s find themselves in a paradoxical situation – they are ‘asset-rich’ due to the value of their homes, yet ‘cash-poor’ with limited disposable income. As the cost of living continues to rise, many find themselves struggling to make ends meet, despite owning valuable properties.
“Equity release offers a solution to this dilemma by enabling homeowners to tap into the wealth tied up in their homes. It can provide a much-needed cash injection to enhance their quality of life, cover unexpected expenses, or even help their families. Equity release is more than just a financial transaction; it’s a means of bridging the gap between asset wealth and living standards, ensuring that those who have worked their whole lives to build their assets can finally reap the benefits of their hard work.”
