Weakening pound causes expats’ pension pots to plummet
Many expat pensioners have been unable to make ends meet due to falling pound, pensions administrator warns.
A decade of a weakening pound has left many expat pensioners with up to 50 per cent less buying power from their retirement income now than when they first retired, research from Equiniti has revealed.
Equiniti Paymaster currently administers the payroll and international payment of pensions for over 50,000 expat pensioners, many of whom are former public sector workers receiving an average pension of around £5,600 a year.
The largest single group of these 50,000 pensioners, 12.45 per cent, has retired to the eurozone where someone who retired in 2003 will have seen the purchasing power of their pension fall by 22 per cent. Someone with a £5,000 pension would bring in just under €7,300 (£6,212) ten years ago, whilst the same pension amount would now bring in only €5,692 (£4,843).
The biggest losers are people who moved to Australia as they have seen their pension drop from AUD$13,625 (£9,420) to AUD$7,253 (£5,014), a drop of 47 per cent.
Conversely, pensioners in South Africa and Jamaica have both seen an increase in the buying power of their pension over the past ten years of 6 per cent and 60 per cent respectively.
Keith Boughton, director of Equiniti Paymaster said; “Ten years ago the value of Sterling was significantly higher than it is today, and those emigrating abroad for their retirement enjoyed considerable value from their pension.
“A plummeting pound has left many expat pensioners unable to make ends meet and struggling to find other ways to protect the value of their pensions.”