Italy announces a suspension of all foreign travel from the UK
Brexit has dominated the financial news since the vote was cast in 2016 and while the UK has now officially left the EU, the impacts of the transition are likely to be felt for a long time. Recent analysis from Salisbury House Wealth has found evidence that British pensioners are already being affected.
According to their research, the number of British pensioners living in the EU has fallen as the UK formally leaves the union, with further declines expected.
An increase is expected as UK pensioners now have to apply for residency to live in the EU post Brexit.
Salisbury House Wealth examined data from the Department for Work and Pensions (DWP) and found the number of UK pensioners living in the EU fell to 463,774 in the last year, down from 474,721 in the aftermath of the Brexit referendum in 2016.
Interestingly, some of the more popular destinations among retirees saw some of the biggest decreases over the last year, with this including:
- Italy – falling 10 percent to 33,435 in 2019/20, down from 37,135 in 2015/16
- Cyprus – falling nine percent to 17,219 in 2019/20, from 18,768 in 2015/16
- Spain – falling five percent to 103,382 in 2019/20, from 108,442 in 2015/16.
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The country with the highest population of UK pensioners is Ireland – with 129,661 last year.
France and Germany also placed highly but overall, nine of the 27 European countries saw a decline in UK pensioners in 2020.
Salisbury House Wealth argued the falls could reflect fears over long-term citizenship rights and lingering worries over whether British expats would continue to be treated equally to other EU citizens post-Brexit.
In the long-term, it is expected that the number of pensioners living in the EU will continue to decline as current UK residents no longer have the automatic right to relocate to EU countries.
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Visas will need to be applied for going forward and this could be a long and costly process.
Currently, those living in an EU country will need to apply for residency by June 30 2021.
Salisbury House Wealth said it is important for anyone who wants to retire abroad in the future to build a sizeable pension pot to ensure they can meet the costs of doing so, with moving abroad potentially meaning costly hurdles such as housing, insurance and transport costs.
Some of the key first steps in building a sizeable pot includes analysing what one’s goals are and keeping rigorously to a savings plan.
Tim Holmes, the Managing Director at Salisbury House Wealth, expanded on this: “The last-minute Brexit deal will be a huge sigh of relief for British pensioners living in the EU.
“However, question marks remain over how this deal will unfold over the next few years.
“Many UK pensioners have already packed their bags and left the sunnier parts of Europe behind in the fear that further complications would arise as a result of the UK’s departure.
“British pensioners who are returning to the UK run the risk of facing higher living costs than destinations such as Spain, which they may not have factored into their retirement funds.
“Retirement plans may change course from time-to-time – it’s key that individuals stick to a savings plan so they have plenty of flexibility and most importantly, can achieve their dream retirement when they get there.”
The DWP has recently provided clarity on how British pensions and other benefits may be affected now the UK has left the EU.
They detailed UK law allows for workplace pensions to be paid overseas and the Government does not expect this to change going forward.
Should retirees have any questions on their pensions, they should contact their providers for more information.
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