The report finds older people in LMI households face two key living standards challenges; living alone and saving for retirement.
The proportion of older LMI households comprised of single people has almost doubled over the last 20 years to 38%. This rise – largely due to increased divorce rates – presents a big challenge given the extra resources placed on living as a single person, such as higher housing costs.
Older households’ ability to save for retirement has been helped by strong employment growth over the last 20 years. However, this hasn’t been enough to prevent a sharp income squeeze in the wake of the financial crisis, when typical incomes fell by 6%.
As a result, typical incomes for older LMI households in 2014-15 had only just recovered back to pre-crisis levels (2007-08), and half of these households had less than a month’s worth of income in savings.
The report says that government and employers have a key role to play in improving the labour market experiences of older workers to help them work for longer, save more and boost their incomes in retirement.