Is it me, or is eating your lunch in the garden in February a weird, albeit pleasant, experience? We’ve had such freakishly nice weather that I’ve been able to do exactly that, which is completely unnatural for this time of year and, presumably, a product of global warming. The only thing that is certain in the UK is that the sunshine won’t last! And as my month of trying to live as a pensioner draws to a close, it’s got me thinking about retiring abroad. Apparently 1 million retired Brits live abroad, and this is forecast to rise to 5 million by 2020.
Now, I’m not a great traveller. Frankly it’s down to my genes. The Terretts have never been an adventurous lot. My Dad had his family tree done a few years ago and was disappointed to discover that from about 1700 onwards the Terretts, obviously a boring lot, barely ventured out of Bermondsey and that he was the first to make it…tad ah…across the Thames! To his credit he has now got as far as Ireland, which is probably as exotic as Costa Rica for a Terrett…
As for me, I don’t like really hot weather and I don’t tan. But the cost of being a pensioner in the UK, not to mention the winter gloom, is enough to get anybody dreaming of foreign parts.
Spain has long been popular, with 55,000 Brits receiving their basic pension abroad. But as living costs there and across EU member states rise, some are going as far afield as South-East Asia and Central America because of the good weather and low cost of living. One website I found urges Europeans to retire to the Philippines and Thailand because they have ‘almost no winter at all’, expats can live cheaply and the people are friendly. You can forget worrying about your winter fuel bill and if you’re an Asian food junkie, the added bonus could be the cuisine. Apparently many Americans are similarly retiring to Mexico, not only because living costs are lower but also because they have confidence in the healthcare system, as many Mexican doctors speak English and trained in the US. Dubai is another popular option due to favourable tax and property regulations.
But it’s not an easy decision to up sticks. What happens if you find you hate it and have to return to the UK? Healthcare could be an issue if you have longstanding health problems, and if you don’t speak the language it could be a huge barrier. Another downside is that your pension and savings will be subject to currency fluctuations. Plus there are tax implications. If you’re not careful you could end up paying double tax on your income and if you die without a will in your new country it could make things complicated for your relatives.
My aunt – on my mother’s side which is more adventurous – recently retired to France. But she recommends people wanting to save money spend three months of the year –the winter months – abroad instead of moving lock stock and barrel abroad. “Don’t retire abroad to save money because the amount of money you have depends on currency rates,” she tells me. “There are big complications to do with taxes, which in France, are in a state of flux, as no one knows precisely what will happen with President Sarcozy’s reforms. What you could do is negotiate a price to live somewhere warmer for the winter months, in rental accommodation normally more popular in the summer. If you stay less than three months there will be no tax catch and you would save on heating.”
Surprisingly, considering how often we all moan about boring old repeats, she misses British TV! “One of the inestimable pleasures of British life is the quality of our TV,” she says. “No one tells you that everyone in France has to pay a sort of TV licence fee in their yearly Taxe d’Habitation and tele is poor value with all the American series dubbed, as in Spain. When being frugal in Britain, factor in the entertainment value of British radio and television for the dark gloomy winter months. You could not know how good they are until they are not there.” Dear oh dear! Never thought I should be grateful for daily reruns of The Fall Guy on Freeview!
Have you retired abroad? What was your experience? Did you save money or lose out?