HEALTHPLAN MAGAZINE

For the tenth year running UK over-50s have named Spain as the best retirement destination, according to a survey by Canada Life.

The popular holiday destination that boasts on average, 300 days of sunshine per year, has been the favoured choice of many when it comes to living life post-retirement.

The survey of 1,000 UK adults aged 50-plus, who are not yet retired but are looking to move abroad, was carried out in mid-August.

Nearly half of those that took part in the survey said that they were considering moving to Spain, with 54 percent citing the reason being the cheaper cost of living, an increase from 45 percent in 2021.

These figures are not really surprising, as the increase in inflation, energy bills and the general cost of living are putting immense pressure on UK households. In fact, more than half of those surveyed said the current cost of living crisis made them more likely to move overseas.

However, the cheaper cost of living wasn’t the main motive for retiring abroad, a better lifestyle and the warmer weather were cited by 64 per cent of the over-50s surveyed, not dissimilar to last year's result.

France was knocked from second place by Portugal in the survey and Australia and the US also improved their rankings compared to last year.

Is your pension affected if you retire overseas?

This is something that should be looked into. Canada Life stresses how important it is to make sure that your destination has a reciprocal agreement on the state pension when deciding where to move to.

If you don’t check, you could find out that your state pension is frozen at whatever amount it was set at when you first left the UK.

The UK government has reached agreements with some countries but not all. Australia, Canada, India and parts of the Caribbean are included in approximately 150 other countries that the UK hasn’t got a deal with. For this reason, plus the rise in inflation, it is vital to do your research before leaving the UK.

Spain and other EU countries are unaffected, as, during the Brexit negotiations, new deals on state pension rights were agreed upon.

The Canada Life survey showed that 23 percent of the over-50s who were considering a move overseas, were in fact unaware of this, whilst 20 percent said they knew which countries had frozen payments.

The survey also established the following…

• Aspiring expats think the monthly household income they will need abroad is £1,430 on average
• They believe retiring in the UK will require a monthly household income of £1,931 on average
• And 48 per cent say Brexit is making them reconsider moving abroad
• Some 53 per cent are reconsidering where they might retire to as a result of Brexit
• Covid-19 has made 33 per cent rethink their possible destination, and 29 per cent wonder whether they should go at all.

Andrew Tully, technical director at the firm said that “The dream of retiring abroad is alive and well, despite the economic headwinds and global pandemic.

“The thought of a better lifestyle and weather, coupled with a cheaper way of life drives many over 50s to have a desire to extend the dream holiday to a permanent situation.

“The cost of living crunch, if anything, has made it more likely people will jump ship from the UK.

“Retiring abroad is not a step to be taken lightly though. The financial considerations are vast, such as thinking about the impact of currency exchange rates, local tax rules, and whether state pensions will keep pace with the cost of living.”

If you are considering retiring to Spain, please take a moment to find out more about retirement visas in Spain.

Source

https://www.thisismoney.co.uk/money/pensions/article-11197771/Spain-remains-popular-destination-expat-retirees-low-cost-living.html