Retirement planning for UK expats

Most expats hope to gather enough from their savings and investments to retire early. To help make that life-changing decision about the best time to give up work – and to see if you can afford to so – here are some points that you need to think about.

The first step is looking at your finances and putting them into good shape for your impending retirement. Expats have lots of tax and investment opportunities that are not generally available to someone in the UK. But to take advantage of them, they need to think about:

Where will you live once you retire?

Will you stay in the country where you are now, will you return to the UK or go to another country? Whatever the answer, you need to look at the cost of living, house prices and how your retirement income will be taxed. If you have income generating assets in one country but live in another, you need to look closely at the tax implications of moving the money across borders.

Could you retire early?

No one wants to work longer than they must, but some people will compromise by working part time if that means slowing down while they are younger. If a lower cost of living gives you more spending power in another country, then early retirement is a distinct possibility.

What about emergencies and unexpected costs?

Your retirement income does not only cover day to day spending but also should have a little extra flexibility for home repairs, a new car and those unexpected costs that arise from time to time. If you have children, that might include the cost of a wedding or help with buying a home.

Writing a will

Expats should always have a will in every country where they have property or other assets. Different rules may apply in Britain and the country where you live, so you need to make sure that your money ends up with those that you want to have it.

Check your financial status

Make two lists – one of your savings, assets, and pensions and the other of your debts. Take the total of debts away from the other total and that should leave your net worth. Don’t forget you may have to pay tax on some of this, such as capital gains on buy to let homes. This exercise gives a benchmark to compare against the money you think you need for retirement and will indicate if you should keep on saving or are financially ready to retire.

Feel free to contact us for a complimentary pension advice.