Spain Is Top Retirement Destination For British Expats

Brexit uncertainty has not impacted the favourite places for British expats to retire.

A new poll asked more than 1,000 Brits over 50 considering a move overseas where they are planning to go.

The overwhelming majority picked Spain – a regular favourite.

France and Portugal also ranked highly with Brits as retirement destinations.

Italy grabbed fourth place, ahead of Greece and Cyprus in fifth.

The rest of the top 10 were a lot farther afield – with Australia, New Zealand, the Asia Pacific and USA taking the sixth to ninth places and Turkey coming in tenth.

Retirement risks

“Whether it be the hope of better weather, cheaper living costs or simply a lifestyle choice, many of us harbour desires to retire abroad,” said Andrew Tully, technical director at Canada Life, the firm carrying out the research.

“Given the prevailing headwinds and uncertainty continuing to surround Brexit, it’s perhaps not a surprise to find the ‘B’ word having a big influence on peoples’ plans for retiring abroad.

“Other things people will need to consider include a new set of retirement risks, whether that be local tax laws, feeling the pinch because of currency exchange rates or financial scammers.”

Tully also urged expats to find out about their state pension entitlement before moving overseas.

The research showed one in four expats were not aware of countries with reciprocal state benefit arrangement with the UK – and only these countries increase the state pension in line with inflation each year.

Fixed rate state pension

More than 500,000 retired expats are paid a fixed rate state pension based on the value of their first payment with no cost of living top-ups.

“As part of the Brexit negotiations, reciprocal social security agreements have been reflected in the Withdrawal Agreement, and in the event of a no deal the UK has stated it would preserve the uprating of the State Pension,” said Tully.

“But it’s worth keeping in mind how your financial position would be affected by changes to these agreements, how incomes currently paid in sterling would be impacted by currency exchange rates, as well as how your UK State Pension may not keep pace with cost of living increases.”

The UK Department of Work & Pensions confirmed the government will not extend cost of living increases to places without a reciprocal agreement.

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