Retiring overseas? Make sure you are ready for the pensions changes on 6th April
As a pensioner moving abroad, you need to be aware of the implications of the imminent ground-breaking pension reforms, which go live on 6th April. It’s critical to plan for these new pension rules, coming into place next week, to avoid wasting thousands of pounds unnecessarily or running into any financial difficulties after you have moved to a new country.
What are these new pension rules?
The new rules provide more freedom on how you can use your pension, and mean that it is no longer mandatory to take an annuity with your pension. The changes coming into force will also mean it will be easier to pass some of your pension fund on to your beneficiaries after death.
How will the new rules affect me?
Planning ahead – before you move.
It’s best to make all your financial arrangements well in advance of your move overseas. It is more difficult to reverse any financial arrangements made in the UK once you have moved overseas and become a resident abroad. There are also tax and inheritance laws specific to your overseas country of residence.
Expats drawing a UK pension are vulnerable to fluctuating exchange rates, which can go up and down by the minute, affecting the amount of income you receive in your new country of residence. When transferring any money overseas, you are at the mercy of the current exchange rates, so it pays to know what’s going on in the currency markets and plan your currency buying ahead wherever possible, with the help of a currency specialist. They have useful products and tools to help you know what’s going on in the markets, helping you to plan ahead, save money and avoid risk when sending lump sums or regular payments abroad.
An example of just how big a difference this makes can be seen in expats who already receive a UK-based annuity or state pension who, purely as a result of the continued weakening of the euro against sterling, are currently receiving an income in euros at around eight per cent higher than they were a year ago.
To find out how this is likely to affect you, we recommend contacting our trusted currency partners, Smart Currency Exchange, to assess your particular needs. Call them on +44 (0) 20 3582 7768 or click here to register for a free, no obligation account.