Year-round sun, new adventures, moving nearer family... there are many reasons why thousands of Britons choose to retire abroad.
Making such a big life change can have some serious implications financially - we’ve gone through some of the biggest questions and put together some answers and things to think about.
Holidaying abroad is lovely - the wine is cheap, the food is delicious and everything just seems to be so much better value than in the UK. But, moving abroad brings a raft of hidden charges. Portugal, for example, might seem incredibly cheap when you’re enjoying the local seafood during a week away, but the cost of petrol is higher than in the UK. Things like this don’t register while on holiday, but could impact heavily on your budget when living there.
Make a list of things you normally spend money on, and do a sense check against how much they will cost in your new country. You will have some pleasant surprises as well as some depressing realisations! Most countries have an active expat internet forum (a quick “(country) expat forum” google search will find the one relevant to you, or take a look at ExpatForum.com) filled with people who have been in your situation, happy to help with information.
This is one of the biggest decisions you will need to make, and both options have their pros and cons. Buying a property that then drops drastically in value (as many UK retirees to Spain have experienced in the recent years) can mean never being able to afford to live in the UK again. Conversely, renting when you have owned a property through your adult life can seem like a strange step backwards to take, however convenient it might be in many ways.
If you want to buy a property in your new country, it is of vital importance that you use a reputable estate agent who speaks fluent English. They should be a member of the Federation of Overseas Property Developers, Agents & Consultants or a member of the Association of International Property Professionals. You should not appoint a lawyer who is connected to the estate agency, but rather an independent person who is fluent in both English and the local language.
A big threat to a stable expat life is a change in the exchange rate between the pound and your new currency. If you are transferring money from the UK to your local bank, then a sizeable drop in the pound against the euro could make a catastrophic difference to your financial situation. You can mitigate this in two ways.
Firstly look into “fixing” the currency - essentially buying your currency for a long time in advance and banking it. Of course, this could have an impact the other way if the exchange rate moves in your favour, but better that than losing out on a hefty chunk of income. Secondly, transfer your money as cheaply as possible. Bank fees can be surprisingly high but a service like Wise can save on transfer charges.
Retiring abroad is such a dream for so many, that actually making it into a reality can seem cripplingly daunting. For some practical tips on actually getting started, and the things to think about, take a look at our practical three part guide to moving abroad.
All you need to know about the US Foreign Tax Credit as an American expat.
If you're a US expat, a resident alien or you've moved to the US, check out this guide to know whether you're subject taxes, and find the best tips in 2022.
Can you get an international student loan as a foreign student in the US? Find all you need to know — and the best options for you — in this handy guide.
Be it for temporary reasons or a more permanent pursuit of the “American Dream,” moving to the United States of America always entails a few adjustments —...
Moving to Europe is no doubt a ‘bucket list’ item for many people around the world. The history, diverse cultures and languages, and excellent quality of life...
Want to save money when you send Brazilian reais? There’s a smarter, cheaper way to send money internationally. When you convert currencies with traditional...