Retiring overseas could be cheaper for UK pensioners

by Ray Clancy on June 16, 2014

Higher utility bills and other living costs in the UK could be enough to persuade more people to retire overseas, research suggests.

Pension experts at Expat & Offshore have analysed data from the Organisation of Economic Co-operation and Development and predict that emigration out of the UK will continue to rise if current pension savings trends continue.

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Many UK citizens may choose to retire abroad and make their savings go further

The average UK pension, including state pension, pays out £15,800 per annum. Whilst this is an improvement over last year’s £15,300 it’s still far below the pre-recession average of £18,700.

On top of this, recent research by the Post Office and the Centre for Economics and Business Research (CEBR) shows the potential saving power of UK households has fallen dramatically since 2010, and predicts it will continue to decline.

In 2010, UK households could expect to save around £4,414 a year. This figure fell to £3,780 in 2013 and is forecast to fall to £3,630 this year and to £3,518 in 2015.

If this forecast is accurate, by 2018 the figure will stand at £2,994, a 32% drop on the 2010 figure. Experts claim this will put 2018’s savers on par with those of the 1960s.

Michael Brinksman of Expat & Offshore suggests that as a result of these trends, retiring abroad could soon become a more attractive prospect for UK retirees at the lower end of the savings spectrum.

‘Previously retiring abroad was a luxury for the high earning members of society, but now, with higher utility bills and consumer goods hampering people’s abilities to save into retirement, we predict that many UK citizens will choose to retire abroad and make their savings go further,’ he explained.

Lisa Sadleir, owner of blog Family Life in Spain, lives with her family in Andalucía and said that Spain is not as cheap as it used to be for day-to-day items and utilities. She explained that expats who’ve lived in Spain for some years can often be heard complaining about the continued rise of living costs in the country.

Although the data suggests Thailand is one of the most cost effective destinations for British expats, real experiences can differ, according to Jan Anderson is a long term Pattaya resident.

‘It’s possible to live happily on £15,800 if you keep within a fairly tight budget, but this would mean living outside the major urban zones such as Bangkok and Pattaya,’ said Anderson.

 

 

{ 1 comment… read it below or add one }

Lucas Davis June 25, 2014 at 2:51 pm

An interesting post and I think pension saving trends are just one reason why people are choosing to move or retire abroad. I think now more than ever people are seeing new job opportunities and a better quality of life. I know Thailand is well established for its excellent healthcare system and high quality facilities. Do we know where most people are choosing to go?

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