New research shows that 234,880 British expat pensioners currently claim their state pension from Australia.
In fact, almost 20 per cent of all British state pension claims made by those living abroad last year came from expats living in Australia.
In total, 1.2million British expat pensioners claimed from abroad last year. The US, Canada, Ireland and Spain made up the rest of the top five spots.
The research, carried out by easyMoney, found that not all countries fare equally when it comes to drawing a state pension, and that some retirees are losing out by more than £4,000 a year due to differences in pension rules across jurisdictions.
For example, in some countries the rate at which the state pension is paid is frozen when you first retire or move abroad. This is the case in some of the most popular emigration destinations, including Australia and Canada. However, for those moving to certain destination – like any EU country (at the moment) or the United States – the rate of state pension received remains the same as what it would be if they were still in the UK.
This means that roughly 550,000 British pensioners living overseas receive a reduced state pension.
“Spending your golden years abroad is an attractive option for many but it does rely on having a sizeable private pension pot,” said Andrew de Candole, CEO at easyMoney.
“Unfortunately, leaving cash sitting in low interest savings accounts will not fund that dream retirement abroad. Investors need to put their money to work whilst they are working in order to reap the rewards when they retire.”
The International Consortium of British Pensioners and other groups have long campaigned on the issue. So far, though, all efforts to unfreeze state pensions have been rebuffed by the Government.
Article published 21st January 2019