Do Expats have less money for retirement then non-expats?
Even people who love their jobs tend to savour their time off, and as the years pass many of us start living for our relaxing weekends and odd weeks away, daydreaming of the time when we can enjoy a wonderfully selfish retirement.
But for over a third of expats retirement might not bring the relaxing lifestyle, slower pace of life and increased opportunities that many hope to look forward to.
Recent data has revealed that 36 per cent of expats lost track of their retirement funds as saving for the future came secondary to enjoying a high-quality expat life in the present.
A study conducted by The deVere Group highlights the issues that expats face when it comes to building up a nest egg.
The study asserted that ‘More than a-third of expatriates have misplaced pension pots’.
The deVere Group commented that in a poll of over a thousand current, past and potential expats, more than 400 have found saving for the future incompatible with the typical expat lifestyle.
From the figures they have deduced that expats are ‘typically more likely than those who remain in their ‘home’ countries to have lost track of retirement savings because not only are they likely to have worked for several employers over their careers, but also worked in several different countries. It is this scenario that creates the perfect storm for a pensions vacuum.’
The study also added; ‘Due to the types of careers they have, and lifestyles they lead, expats will typically reside in several overseas destinations throughout their working lives, and be employed by several employers. A consequence of a more transient lifestyle is that it is more of a challenge to keep up to data with personal finance admin, such as informing providers of new addresses. As such, many expats find that their accumulated retirement savings can all too often become lost over the course of time. This is not just an issue for those who are nearing retirement. Our poll shows that a high proportion of those in their 30s and early 40s also have misplaced pension pots’.
Even if you don’t mind living the simple life, retiring just isn’t possible without some financial backing behind you. As well as struggling to meet accommodation and food costs, expats without retirement funds will find it difficult to afford trips home to see friends and family and may not be able to afford essential healthcare bills.
If you want to keep track of your money it really is essential to keep hold of your pay slips, tax contributions, P45’s/P60’s, proof of employment and proof of earnings.
Furthermore, where possible, try and save 10 per cent of your monthly income so that you have something to fall back on if there are any problems with accessing your pension later down the line.
If you’re concerned that you’ve lost track of your pension contributions your current employer might be able to help. Alternately, get in touch with the tax authority of your native country and explain your situation.
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