Important:

This article is for information purposes only.

Please remember that financial investments may rise or fall and past performance does not guarantee future performance in respect of income or capital growth; you may not get back the amount you invested.

There is no obligation to purchase anything but, if you decide to do so, you are strongly advised to consult a professional adviser before making any investment decisions.

Thousands of expats missed out on state pension rise

state pension rise

Many British expats living overseas miss out on these increases due to an issue called the frozen pensions policy

Almost 500,000 expat Brits have missed out on up to £110,000 in state pension payments due to a freeze on their retirement benefits.

The state pension rose by 3.1% a year earlier this month.

But many British expats living overseas miss out on these increases due to an issue called the frozen pensions policy.

British citizens who live overseas in countries like Australia and Canada have their state pension frozen at the level they had when leaving the UK.

If they had stayed in the UK their state pension would go up every year thanks to a government agreement called the triple lock.

This sees the state pension rise annually by inflation, 2.5% or average wage growth, whichever is highest.

But 492,000 British expats live in countries where their state pension is frozen – that’s half of all Brits living overseas.

These Brits can miss out on huge state pension increases over time, as they only get paid a pension at the rate they had when they first retired.

A Brit who retired to a country like Canada in November 1980 would have lost out on £110,995 in state pension over time, according to the Canadian Alliance of British Pensioners (CABP).

This is because their state pension would be frozen at £27.15 a week – £114.70 less than if they had stayed in the UK.

The same figure would apply to any British expat living in a country without an agreement with the UK on retirement benefits – though the pensioner would now be over 100 years old.

These include countries like Australia, Canada, South Africa, New Zealand, India, Pakistan, Bangladesh, Africa and many Caribbean islands.

Anyone who retired overseas last April would get £221 less than they do this year.

The full ‘old’ state pension is £141.85 a week, for Brits who retired before April 2016.

The ‘new’ state pension, for people retiring after that date, is £185.15.

Brits will get yearly state pension increases if they retire in countries like the US, any country in the European Union, Jamaica, Bermuda and Israel.

Last week International Consortium of British Pensioners chairman John Duffy said: This outrageously cruel policy is excluding pensioners, many of whom spent their working lives in the UK, and leaving them to face poverty.

Important:

This article is for information purposes only.

Please remember that financial investments may rise or fall and past performance does not guarantee future performance in respect of income or capital growth; you may not get back the amount you invested.

There is no obligation to purchase anything but, if you decide to do so, you are strongly advised to consult a professional adviser before making any investment decisions.