Planning The Dream Expat Retirement
The Expat Retirement Dilemma
Living abroad as a retiree can provide opportunities to explore different cultures, seek adventure and live in unique communities.
But before you begin your journey, it is important that you plan ahead. From making sure you have the right income and health insurance protection, to navigating visas, currency exchange rates and banking policies- there are lots of moving parts when moving abroad during retirement age.
The thought of living life in a different country can be daunting, but with proper planning and preparation, you can rest assured that your retirement years will be comfortable and filled with new experiences.
With our tips on how to best plan for retirement overseas, you'll have the security and peace of mind knowing that your golden years will be spent worry-free.
Understanding your Position
Expat retirement planning without understanding the ins and outs of your existing pensions can set you off on a difficult path to achieving your dream retirement. It is essential to understand what type of pension schemes you already have, how much they are worth, and how much income each year will be necessary for you during retirement.
Expats typically have multiple pension schemes including company funded schemes, private pensions and state pensions in addition to expat-specific pensions. Knowing all of these elements is a precursor to securing a comfortable future.
This knowledge will help you make the best choices when it comes to planning for Expat retirement and will save a lot of time and energy in the long run - so take the time to assess your position before moving forward.
Combining and Transferring your UK Pensions
Expat retirement planning is often more complicated than staying in one country, but consolidating and transferring multiple UK pensions into a single international pension scheme can make this process simpler. Expats can enjoy the advantage of having all their pension pots in one easy to access account and gain clarity on their retirement savings journey.
This 'one-stop shop' for expats allows for greater peace of mind, helping retirees to know that they can easily manage their pension pot. Expat pension transfers offer convenience, streamline the overall investment management process, and give you the benefit of an integrated view across multiple investments.
Consolidating your finances can be a great way to simplify your expat retirement planning and put you in control over your retirement nest-egg. For most Expats, this consolidation will come in the form of an International SIPP or a QROPS.
What is an International SIPP?
An International SIPP, or Self-Invested Personal Pension, is a great way for Expats to plan for their retirement. Unlike other pension schemes, an ISIPP allows Expats to manage their own investments and make decisions with regards to their expat pension transfer, making it the perfect option for Expatriates who are looking for more control over their retirement planning.
Benefits of an International SIPP include access to a global range of assets, increased tax efficiency and opportunities for cost savings. Additionally, Expats can benefit from the range of Investment vehicles available from individual stocks and unit trusts to ETFs depending on their personal investment goals.
Ultimately, an ISIPP represents an attractive, low-cost option for Expat retirement planning. These accounts are typically best for Expats with pensions below £1 million.
What is a QROPS?
QROPS stands for Qualifying Recognised Overseas Pension Scheme, and can be used as a viable solution to the Expat retirement problem. It enables expats to move their pension savings earned in the UK into a secure offshore account, usually located in Malta. This account will provide access to those savings when they retire.
This can prove highly beneficial as there are certain tax benefits applicable to a QROPS - notably the absence of the Lifetime Allowance Charge. With a QROPS, Expats can also benefit from tax advantages like no UK tax deductions on the funds within the account after five complete tax years of the transfer and a potential exposure to lower foreign income tax rates instead of UK rates.#
Furthermore, spouses of Expats can even inherit the funds on death with little or no delays as opposed to other options available. As such, it's an ideal option for Expat retirement planning and pension transfers for individuals with pension pots valued over £1 million.
Securing your Retirement with The Wealth Genesis
Retirement planning as an Expat is difficult. But one thing is clear: proper financial advice and planning are absolutely essential. With the help of The Wealth Genesis, you can receive regulated and independent guidance - no matter your current location or financial situation - to ensure you have peace of mind when you most need it.
Restoring control over your retirement plan is made possible through creating long-lasting foundations and diversifying investments through various geographical, capital and income strategies.
Whether you're already retired and looking to make sure your savings last or whether you're in your twenties just setting out, let The Wealth Genesis provide their expert insight into which route is right for you.
Get started today to begin your journey towards retirement security.
