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Nation’s favourite retirement hotspots

Andrew Tully, pensions technical director, Retirement Advantage
However, without the right planning and financial advice, your retirement could very quickly become a nightmare. Local tax laws, currency exchange rates and other financial issues can easily catch out the unwary.
Andrew Tully, pensions technical director, Retirement Advantage
  • One in ten over 50s considering retiring abroad
  • Key reasons include the prospect of a better lifestyle, a cheaper way of life and better weather than the UK
  • Spain tops the poll for the most popular destination

Retirement Advantage, the retirement specialist, has revealed the nation’s favourite retirement destinations, with Spain once again ranked first.

The nation’s favourite retirement hotspots are:  
1st: Spain 6th: The Far East
2nd: France 7th: America
3rd: Portugal 8th: New Zealand       
4th=: Italy 9th: Australia
4th=: South East Europe  

Andrew Tully, pensions technical director at Retirement Advantage, said: ‘Retirement means different things to different people, including spending more time at home with the family, starting a new hobby or volunteering. For others it’s the appeal of retiring abroad, with the prospect of a better lifestyle, better weather and cheaper living costs than the UK.

‘However, without the right planning and financial advice, your retirement could very quickly become a nightmare. Local tax laws, currency exchange rates and other financial issues can easily catch out the unwary.

‘For example, if you retire to some countries, you will not be eligible for increases in the State Pension, which currently rises by the higher of inflation, earnings or 2.5%, under the 'triple lock' mechanism.

‘Countries in the EU, as well as many others, have ‘reciprocal arrangements’ with the UK, meaning your State Pension will increase each year. However, other countries including Australia, Canada and New Zealand do not, which means the state pension will not increase once you move overseas.

‘For example, a single person who retired in 2007 to a country where there is no reciprocal agreement in place would have seen their State Pension frozen at £87.30 a week. It is now £122.30, a difference of 40%, or £1,820 less annual income.

‘When we leave the EU, reciprocal arrangements will form part of any deal reached, so it is unclear what the position will be in future.

‘So it’s worth keeping in mind how your financial position would be affected by changes to these agreements as well as how incomes paid in sterling are affected by currency exchange rates.

‘To help navigate the complexities of retiring abroad, especially given the uncertainties from Brexit, it is vital people seek professional financial advice. There are a number of companies able to help budding expats, and receiving the right advice could make the difference between making a retirement dream a reality or a nightmare.’

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 (only applies 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
  1. Survey conducted by Censuswide between 20.03.17 and 22.03.17 of 1,013 over 50 year olds who are yet to retire.

Top retirement destinations outside the UK compared to 2016


2017 (over 50’s not retired)

2016 (over 18’s not retired)



1. Spain



2. America



3. Australia



4. France


South East Europe

5. Italy


The Far East

6. South East Europe



7. Portugal


New Zealand

8. New Zealand



9. The Far East


Not scored due to sample size    

10. Canada

2016 data: research was conducted by Censuswide. The survey was carried out online between 6 July and 7 July 2016 among 1,200 18+ year olds, not retired.