You might be able to escape the bad weather and the bustling crowds of the city, but one thing you can’t run away from is the global financial crisis. Unfortunately the UK has a struggling economy, a weak pound and poor interest rates, and many people believe that they can leave all these worries behind for sunnier climes. Sadly though, those expats can still be affected by the situation back home if they’re relying on an income garnered from British-based assets.
To try and help you in the battle against global economics, we’ve put together a guide to try and provide you with the knowledge to protect your money and survive abroad.
Research currency exchange
Thanks to the internet, currency exchange has become a lot more convenient and the average Joe can now move money around at their leisure to comply with the most preferable rate possible. Banks are not always your best friend when it comes to exchange rates so it pays to shop around for the best option of moving around large sums of money and who offers the best exchange rates and terms. If in doubt, pick up the phone and ring around and talk to a financial expert who can simply outline your best options.
QROPS have proved to be a complicated topic due to their ambiguity but it’s important to at least be aware of them. Trying to put it simply, QROPS stands for “Qualifying Recognised Overseas Pensions Scheme” which effectively allows you to move your private pension offshore. There are many possible benefits to this such as avoiding UK taxation on your pension, avoiding currency fluctuations and giving you greater control of your savings. As with all money-moving schemes there are risks associated with QROPS so it’s important to get some advice and fully analyse the pros and cons.
Many expats find that when they retire they are not entitled to a state pension because there are gaps in their National Insurance (NI) history. If you have missing years of not paying NI you can simply not just buy your way back onto the scheme but you can pay up to six years arrears to make up the necessary contributions of 44 years for a man and 39 years for a woman. To avoid this situation, you can first check your NI record by getting in touch with the Inland Revenue Centre. If you want to make sure you’re fully eligible for a UK state pension then you can organise voluntary NI contributions while you’re out of the country.
Though many see renting as just throwing money away, it can prove to be the safest option in what is an unstable housing market all over the world. Unless you’re fully committed to spending the rest of your life abroad you may be best advised to rent in your soon-to-be adopted homeland and leave your UK property up for rent also. No one can predict the future but you might find it difficult to sell your house in the UK and find it even more difficult to up sticks overseas in a few years time. The real estate market in Greece, Spain and Portugal has crashed completely whilst the likes of Australia and New Zealand have some of the highest priced properties in what is still a slow moving sector.
If you’re planning on moving abroad then it’s of critical importance that you get in touch with a financial expert so that you can assess what to do with your money and can avoid getting caught out by confusing foreign regulations.