Spain tops new poll of where Brits want to retire

by mfefadmin on August 26, 2015

Spain is the most popular country in the world for British expats to move to for retirement followed by France while North America is the top choice outside of Europe, new research has found.

A poll of people aged over 50 who have yet to retire found that 24% would move to Spain if they retired abroad, 20% to France and 9% somewhere in south east Europe such as Greece, Turkey or Cyprus.

spain-flagThe survey for financial services company Retirement Advantage by YouGov, also found that 6% would move to Portugal and 6% somewhere else in Europe.

Outside of Europe some 22% would move to North America, 15% to the Far East, 12% to the Caribbean, 11% to South America and 17% to some other country.

According to the firm, lower living costs and potentially cheaper property than in the UK are top reasons for British people deciding to move abroad when they retire. Year-round sunshine is also an attraction, along with a slower pace of life.

Many people dream of moving to a place where they have spent great holidays but according to the firm’s spokesman Andrew Tully thinking that a holiday spot can also be an ideal retirement destination might be flawed.

‘Without the right planning, savings and advice, you can quickly get caught out by local tax laws, exchange rates and other financial arrangements, turning a retirement dream into a potential nightmare,’ he said.

‘You might also get a nasty shock later in retirement when you find your UK state pension does not increase annually because the country you choose to retire to does not have a reciprocal agreement in place with the UK,’ he added.

The firm gives as an example a person who retired to Canada 10 years ago would find that their UK state pension is now be worth 41% less than if they had retired across the border in the United States. Or put another way, the pension would be worth £1,762 more a year by simply choosing the US as a retirement destination rather than Canada.

Retirees are advised to get an estimate of what their state pension would be, to seek financial advice and to tell the taxman of the move as this allows HMRC to send notification of any UK tax liability there might be while living overseas.

They also need to check about having a UK pension be paid gross, before tax deducted, direct to a bank in the new country of residence but this is only possible if the country has a double taxation agreement with the UK.

It is worth checking what other reciprocal agreements are in place regarding not just pensions but also healthcare and social security benefits. People should check the cost of healthcare in the country they are thinking of moving to, and consider some form of medical insurance.

Those with a property in the UK that has a mortgage and decide to rent it out need to let their lender know and insurance cover needs to be put in place even if it remains empty.


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