• Over six million UK adults are planning to retire abroad
• Spain tops the poll for most popular overseas retirement destination
• France second in the rankings, followed by USA
In total, over 6 million UK adults are planning to retire abroad, with an even split between Europe and the rest of the world. Of the estimated 3.2 million UK adults planning to retire in Europe, Spain is the most popular destination with 26% of the vote. France follows in second place with 17% of votes. Italy comes in third place with a 10% popularity rating.
MGM Advantage, the retirement income specialist, has revealed the nation's favourite overseas retirement destinations, which are:
Looking further afield, an estimated 3.2 million UK adults are planning to retire outside Europe. The most popular destination is America, with 16% of votes. Australia follows in second place with 14% of votes. Coming in third place is the Far East, which pulled in 13% of votes.
Andrew Tully, MGM Advantage commented:
'A huge number of people harbour a desire to retire abroad. Thoughts of better weather, cheaper living costs and potentially cheaper property than the UK can be a strong draw. But, thinking that your regular holiday destination can also be your ideal retirement home might be hit with flaws. Without the right planning, savings and advice, you can quickly get caught out by local tax laws, exchange rates and other financial arrangements, turning a retirement dream into a potential nightmare.
'You might also get a nasty shock later in retirement when you find your UK state pension does not increase annually because the country you choose to retire to does not have a reciprocal agreement in place with the UK. As an example, if you retired to Canada ten years ago, your UK state pension would now be worth 42% less than if you had retired across the border in the US. Or put another way, your pension would be worth £1742 more a year by simply choosing the US as a retirement destination rather than Canada.
'To help navigate the complexities of retiring abroad, it is vital people seek professional financial advice. There are a number of firms who specialise in providing advice to budding expats, which could make the world of difference between the retirement of your dreams or an altogether more challenging experience.'
Top tips for retiring abroad
1. Get an estimate of your state pension here
2. Seek independent financial advice before you move
3. Tell HM Revenue and Customs that you are moving overseas. This allows them to let you know of any UK tax liability you may have even though you are living overseas. And more importantly can allow any UK pension you have to be paid gross (no tax deducted) and taxed in your country of residence – if the country you live in has a double taxation agreement with the UK.
4. Check what reciprocal agreements are in place with the destination country regarding your UK state pension and other social security benefits
5. Find out about your welfare rights while abroad
6. Keep an eye on exchange rates
7. Check the cost of healthcare in the country you are thinking of moving to, and consider some form of medical insurance
8. If you decide to keep your property in the UK you will need to let your mortgage provider and insurance company know if it will be rented or remain empty
9. Do your homework on the cost of living in the country you want to move to
10. Notify utility companies, financial institutions and your local council when you are leaving
11. Contact the electoral register, and arrange for mail forwarding via the Post Office
To help people considering retiring abroad MGM Advantage has published tips here: www.mgmadvantage.co.uk/blog/retiring-abroad-thinking-of-retiring-abroad/