Expats Need To Be Told More About Their Retirement Options

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Financial experts are starting to pick up on the idea that expats are not well-served by their providers once they stop contributing into their pensions.

A debate is firing up around the rights of deferred members – those who no longer pay into a pension but have a fund.

Research has shown that only 30% of pension providers routinely offer fund updates and advice to deferred members.

A significant number of these savers now live overseas and probably know little or nothing about their pensions and retirement options other than what their providers tell them – and that’s not a lot either.

Brexit is also likely to stir up more deferred members – either EU citizens heading back home or Brits returning to the UK.

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Looking after their own

For expats and EU nationals returning home, UK pensions only pay in Sterling and as the pound has shrunk in value, so has pension spending power overseas.

Many others cannot transfer to a QROPS, either because their country’s laws do not allow the switch or do not offer the expat pensions.

For example, the US does not allow a UK pension transfer into a 401K or IRA, Canadians cannot move their UK savings to a RPS and Indians have no pension transfer options other than QROPS.

The reason is that every country looks after their own pension arrangements and few have options for cross-border transfers.

Know your retirement money rights

Expats are at the mercy of foreign tax laws treating their savings entirely differently from the UK system, currency exchange fluctuations and unregulated advisers who are not qualified to act across frontiers.

As an expat or former international worker in the UK, it’s vital to know your retirement money rights relating to cash in UK pensions.

From January 2019, direct benefit pension providers must give clearer statements to savers about the value of their funds and benefits – but only within Europe under new EU rules.

Retirement planning is important if expats want to make the most of their savings, so choosing a reputable adviser with cross-border tax and financial service experience is a sensible move.

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