Credit Management March 2020

OPINION
Silver Service
Insolvency among silver surfers is on an
alarming upward trend.
AUTHOR – Stuart Lewis
THE industry has been full
of insolvency data recently,
and analysing the data
reveals some interesting –
and disturbing – trends. It
shows, for example that the
number of women aged 65 and over who
have fallen into an insolvency situation
has increased from 1,109 in 2008 to 2,082 in
2018 – an increase of 88 percent in a decade.
The insolvency rate of this group
increased from 0.02 percent to 0.04
percent in the same time period – the
biggest increase across all age groups.
Insolvencies amongst men aged 65 and
above also increased by 29 percent in the
years between 2008 and 2018.
Whilst the number of insolvencies
amongst women increased significantly in
every age group between 2008 and 2018, the
jump was biggest amongst the over 65s (88
percent) followed by women aged between
45-54 (69 percent) and the over 55s more
generally (69 percent). So what does it all
mean?
CAUSE FOR CONCERN
The rapidly increasing rate of insolvency
amongst all women is cause for concern
but is particularly concerning amongst
women over 55, many of whom are already
at higher risk of finding themselves in a
financially precarious position: the over
55s are more likely to be made redundant,
to be in long term unemployment and to
face age discrimination in the recruitment
process when applying for jobs.
Women in their 50s and 60s are
also more likely to have taken time out
of the workplace and to have caring
responsibilities, whether for elder relatives,
partners or grandchildren. Add to this,
the wide gulf in private pension savings
between men and women - due to 40 years
of a historical gender pay gap – and it’s no
surprise to see why insolvencies amongst
women over 65 are rising faster than other
groups.
In contrast, insolvencies amongst
men did not increase across the board in
the same way. The only increases were
amongst men aged 65 and above (29
percent), 18-24 year olds (34 percent) and
25-34 year olds (three percent) whereas
across all other male age groups, the
number of insolvencies dropped. In 2008,
the insolvency rate of men aged over 55
was double the rate of women (0.12 percent
versus 0.06 percent). By 2018, this gap
narrowed considerably with the insolvency
rate of women aged over 55 increasing
to 0.08 percent whilst the rate for men
dropped to 0.10 percent.
Across all age groups, the overall
insolvency rate of women has rapidly
overtaken the rate amongst men between
2008 and 2018. In 2008 the male insolvency
rate was 56 percent higher than that of
women but by 2018, this had completely
reversed with the female rate of insolvency
14 percent higher than that of men.
Mark Sands, Chair of the Personal
Insolvency Committee at R3, the insolvency
trade body, says that the over-65s have a set
of unique challenges which include living
on fixed pension incomes with barely any
returns on savings: “When you’re in this
situation, it’s no surprise that you might be
more vulnerable to financial shocks. You
just don’t have as much flexibility,” he says.
“Also, more people are reaching
retirement with unpaid debts, and if
their retirement income and savings are
insufficient to service or repay those debts,
they are then faced with stark choices
and many people then find that a formal
insolvency process is the best solution for
them. Anyone finding themselves in that
situation should take advice from a suitably
qualified independent advisor.”
So what should be done about it?
We’d like to see more holistic support
being provided and focused around
later life re-training, encouraging all-age
apprenticeships and common place age
diversity policies aimed at supporting
this often overlooked, but talented and
hardworking group of individuals.
Stuart Lewis is Founder of Rest Less, a
jobs, volunteering and advice site for
the over 50s.
“When you’re in this
situation, it’s no surprise
that you might be more
vulnerable to financial
shocks.”
Stuart Lewis
Advancing the credit profession / www.cicm.com / March 2020 / PAGE 27