Brexit halts pensioners' EU emigration trend

Brexit halts pensioners' EU emigration trend

The number of British pensioners living in the European Union (EU) has fallen by 6,110 to 468,790 in 2017 to 2018, when compared with the previous year.

This is according to research from EasyMoney, based on figures from the Department for Work & Pensions (DWP).

This is the first year since 2007 that the number of pensioners retiring abroad has decreased.

Article continues after advert

The investment provider argued that pensioners could be put off from moving to the EU due to uncertainties surrounding their citizenship rights after the Brexit transition period, or in a no-deal scenario.

If approved, the withdrawal agreement between the UK and the EU allows British citizens in the EU 27 to retain their legal residency and social security rights, but only until December 2020.

EasyMoney noted pensioners could also be discouraged from buying a property in the EU as potential currency fluctuations could make this more expensive.

Former pensions minister Baroness Ros Altmann has warned of the risks to British expats in a no-deal Brexit, as state pensions will only be uprated if host countries reciprocate.

Over the last decade, there has been a 26 per cent increase in the number of expat British pensioners living in the EU, which is now equivalent to the combined population of Brighton and Portsmouth.

Out of the major destinations, the biggest increase in UK pensioners was in France – where the number increased by 49 per cent to 66,970, up from 44,860 in 2007 to 2008.

According to Andrew de Candole, chief executive at EasyMoney, despite the Brexit vote, thousands of pensioners have retired to the sun in recent years.

He said: "A sizeable private pension is the key to retiring abroad but low interest savings accounts and cash Isas will not get people to the beach for their golden years.

"Many savers are increasingly willing to take on a calculated risk for better returns in order to build up the pension pot that is required to fund a dream retirement."

Martin Bamford, chartered financial planner and managing director of Informed Choice, argued there is a big attraction in retiring abroad, especially within the EU where rights to live, healthcare and state pension increases are assured.

He said: "Brexit uncertainty is discouraging some new retirees from making the move and could be prompting some UK retirees already living in the EU to reconsider. 

"Whether you decide to retire to another country within or outside of the EU, and whether or not Brexit proceeds with an agreeable deal, it is important to fully understand the costs and risks associated with any decision on where to live in retirement.

"Access to a warmer climate and cheaper cost of living might outweigh a difficult property market or lower standards of healthcare in the earlier years of retirement. This balance often shifts as we get older. 

"If you decide to retire abroad, make sure your financial plans fully support this decision and you have a suitable exit plan should the local political or economic situation suddenly change."