We investigated the immediate and longer-term impact (over 4-6 months) of probable COVID-19 infection on mental health, wellbeing, financial hardship, and social interactions among older people living in England. Data were analysed from 5146 older adults participating in the English Longitudinal Study of Ageing who provided data before the pandemic (2018-19) and at two COVID-19 assessments in 2020 (June-July and November-December). The associations of probable COVID-19 infection (first COVID-19 assessment) with depression, anxiety, poor quality of life (QoL), loneliness, financial hardship, and social contact with family/friends at the first and second COVID-19 assessments were tested using linear/logistic regression and were adjusted for pre-pandemic outcome measures. Participants with probable infection had higher levels of depression and anxiety, poorer QoL, and greater loneliness scores compared with those without probable infection at both the first (ORdepression = 1.62, P-value = 0.005; ORanxiety = 1.59, P-value = 0.049; bpoorQoL = 1.34, P < 0.001; bloneliness = 0.49, P < 0.001) and second (ORdepression = 1.56, P-value = 0.003; ORanxiety = 1.55, P-value = 0.041; bpoorQoL = 1.38, P-value < 0.001; bloneliness = 0.31, P-value = 0.024) COVID-19 assessments. Participants with probable infection also experienced greater financial difficulties than those without infection at the first assessment (OR = 1.50, P-value = 0.011). Probable COVID-19 infection is associated with longer-term deterioration of mental health and wellbeing and short-term increases in financial hardship among older adults. It is important to monitor the mental health of older people affected by COVID-19 and provide additional support to those in need.