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Poverty in later life

Morgan Vine

Living in poverty can have a huge impact on every area of someone’s life. In January 2022 the national older people’s charity Independent Age released their new report Poverty in later life, exploring whether people past state pension age enter or exit poverty, and why.

  • Health inequalities

The impact of living in poverty

At Independent Age – a charity who offers a range of services to support people aged 65 and over, their friends and family – our advisers and community teams regularly hear from people in later life with money worries who share that living on a low income affects every aspect of their life.

One woman shared that she could only justify boiling the kettle once a day and she often felt she had no choice but to buy unhealthy food as it was cheaper. Another told us that she couldn’t afford to put the heating on so went to bed in a woolly hat. It’s not difficult to see how these decisions can have a detrimental impact on a person’s health, especially if they are living with a long-term health condition, which is the case for many people in later life.

In addition, we’ve also spoken to people who are incredibly worried about not having enough money. They fear they won’t be able to afford an unexpected expense like a boiler breakdown or leaky tap repair. And they make excuses not to see friends because they can’t justify the price of a cup of coffee in a café. This is taking a huge toll on people’s mental health with them feeling anxious, depressed, lonely and isolated.

With inflation at an all time high, the cost of living rising, and the number of older people in poverty on the rise (currently over 2 million) action is desperately needed to ensure people in later life on a low income are better supported.

Poverty across the life course

At Independent Age we know that for some, living in poverty can be a lifelong state which they begin in childhood and are never able to exit, and we want to work with others to tackle poverty across the life course. But as the people we directly support are aged 65 and over, we want to discover whether people enter or exit poverty during their later life, and if so, why.

New poverty in later life research

Our new research with City University of London analysed a two and 9-year period, tracking the financial health of people past state pension age between 2010 and 2019.

Our key findings include:

  • 40% of all pensioners spent at least one year in poverty during the 9-year period. The impact of even one year of poverty can be huge. We found that older people who spend at least one year in poverty within a nine-year period are twice as likely to not to have a filling meal every day and three times as likely to have a cold home.
  • We know from government statistics that certain groups of people are more at risk of being in poverty in later life, including 38% of older private renters, 30% of Black older people and 27% of older people living alone. Our new research shows these groups are also at greater risk of falling into poverty past state pension age including single women, older renters and Asian older people. This implies that these inequalities don’t just play out in working age, with people entering retirement already in poverty, but also that people are entering poverty past retirement age.
  • When looking at the data over the nine-year period, around one in 20 pensioners was longer-term poor, which means they experienced poverty for seven to nine years of the nine-year period. Certain groups of pensioners are more likely to experience longer-term poverty, in particular, single older people, black older people and older renters.

Why did older people move in and out of poverty in later life?

Our new research shows that changes in social benefit income is the biggest single cause for older people entering and exiting poverty. Social benefits in later life include Pension Credit, Council Tax Reduction, Housing Benefit and others. We found that three in five (61%) pensioners who enter poverty during later life have experienced a reduction in social benefit income.

Our recommendations

We believe that tackling poverty in later life will require an ambitious strategy to tackle poverty at all ages, while maximising the effectiveness of existing programmes (like Pension Credit).

We know from previous research which we did with Loughborough University that if Pension Credit take-up was lifted to 100% then almost 450,000 people could be lifted out of poverty, reducing pensioner poverty to its lowest ever level. That research also found that failing to deliver Pension Credit to the four in ten eligible pensioners who ae entitled to it costs the state an estimated £4 billion a year in increased NHS and social care spending.

Progress in this area has been far too slow, with take-up hovering around 60% for many years. We want national and local government to think cleverly about how Pension Credit take up can be increased. As part of our Credit where it’s due campaign, we’re calling on the Government to put in place an ambitious action plan, detailing how they will increase the uptake of Pension Credit over the next five years and we welcome ideas and suggestions from others about how this problem could be tackled.

To stay up to date with our Credit where it’s due campaign, which aims to ensure more older people receive Pension Credit you can sign up to our campaigner e-mail network.

If you, or someone you know, is aged 65 and over and needs information and advice you can find out more on our website or call our free helpline on 0800 319 6789.


Morgan Vine is the Head of Policy and Influencing at the national older people’s charity Independent Age. Across her career Morgan has worked to secure policy change at charities such as Age UK, RNIB, Parkinson’s UK and Versus Arthritis. Morgan is an active member of several coalitions and a Trustee for Age UK Bromley and Greenwich.