Why Expats Really Have No Excuse When it Comes to Pension Saving

If you don’t save for your pension you are the only one who will be damaged by your lack of financial commitment.  You are the one who will suffer financially, you are the one who will have to work on way beyond state retirement age, you’re the one who will miss out on the golden years.

And you know what, expats have even less of an excuse when it comes to pension saving and investing than their peers back onshore – and that’s because they have so much more choice of saving and investment vehicle to use to save towards retirement.

In this report we’ll look at why you, as an expatriate, really should be saving towards retirement, and how it is actually so much easier for you now that you’re living abroad and have so many more pension options available to you…

You Have No Excuse So Start Saving

If you don’t start saving into a pension as soon as you possibly can, you will face poverty in retirement.  That is an absolute fact for all of us except the odd inheritor of millions or someone who wins the lottery!  You cannot rely on the state as an expatriate, even if you’re paying voluntary NI contributions back to the UK.  The reason you cannot rely on the state is because the British economy is stuffed, and likely to get worse over the next 40 years according to Standard and Poor’s.  What’s more, that which they currently pay out to pensioners – less than £5,000 a year to those in receipt of the full state pension – is the worse level of pension provision among all member nations of the Organisation for Economic Cooperation and Development.  And that’s a lot of countries!

So, you cannot rely on the state – unless you think you can live on less than £5,000 a year.  And you cannot rely on inheritance unless you’re Paris Hilton.  You cannot rely on your partner – they have to save for their own retirement.  You cannot rely on your kids, they’ll have college fees and an horrendous mortgage to meet when you’re retiring.  So, who have you got to rely upon?  Only yourself.  This means that you have absolutely no excuse whatsoever not to save.

Why Expats Have Even Less of an Excuse

As an expatriate you’re non-tax resident in your home nation, therefore you have what’s called the ‘expatriate advantage’ – i.e., you can make use of the tax saving or tax deferring nature of offshore saving and investment vehicles.  Additionally, there is now a very special offshore pension product called QROPS (qualifying recognised overseas pension scheme) that the British government says you can take advantage of.  You can even transfer your onshore pension pot into it.  It is far more flexible and potentially better returning than an onshore, traditional personal pension.  For example, you don’t have to buy an annuity with it, you may even be able to enjoy an income from it tax free, depending on where you retire.  You can leave excess wealth to your heirs, and you can pretty much state the type of investment you want to do with the money in it!

If this product sounds ideal, ask your financial adviser about it.  Alternatively, if you just want to save for the long term into a fairly straightforward offshore savings scheme – there are hundreds of alternatives available offshore.  You can also invest your wealth however you choose as an expatriate.  So you have all of these options and alternatives for your money at your fingertips.  So you have NO excuse whatsoever to not save.

Save Whatever You Can Afford – No Matter How Small

Even if you can only afford to put £50 aside each month into a pension scheme, that is £50 saved towards your future.  And when it comes to a pension, the longer you save for the better the potential returns you can benefit from.  So, start today, no matter how small, and watch your security in retirement grow before your very eyes.  If in doubt about your eligibility for tax efficient offshore products or the suitability of a QROPS for you perhaps, speak to your financial adviser about the best methods of saving for your retirement.  Don’t put off making that phone call, each day lost is about another week you’ll have to work beyond your preferred retirement date!