UK citizens living in European countries are likely to have to pay twice as much for their cost of living as in UK, according to a new survey
UK citizens living in European countries are likely to have to pay twice as much for their cost of living as UK-based counterparts according to an extensive new survey published today.
New data from Equiniti, an international technology-led services and payments specialist that manages the payments of over 60,000 UK expat pensioners, said in a statement that it has found that those who retired to Europe have seen their cost of living increase by 14% due to currency shifts since May 2015 – almost double the rate of inflation in the UK (7%).
Since the date of the UK general election on 7 May 2015, with the referendum of leaving the EU announced, the intervening period has seen volatility in global currency markets that has dramatically impacted on the spending power of UK expats. Implications of the UK’s exit from the EU (Brexit) and other wider global events; such as trade war between the US and China, have been the main cause of volatility, Equiniti say.
With allowance made for currency fluctuations and 5% inflation in the Eurozone over this period, pensioners living in Europe with fixed GBP incomes, and paid in local currency, have lost out significantly compared to those in the UK.
Equiniti said that it supports around nine million pension scheme members, 6,000 of which are expat pensioners living in Europe who will have been exposed to this diminishment in the purchasing power, but, it says, the problem spans far wider. The ONS estimates there are more than 207,000 British citizens aged over 65 residing in the EU who may be experiencing similar issues.
Director, payment services at EQGlobal, Equiniti, Andy Brown said expat pensioners are always at the mercy of the currency exchange rollercoaster, but after a period of considerable uncertainty they will be facing a significant increase in the cost of living.
Brown said their advice to anyone thinking about retiring abroad is to understand the implications of currency exchange rate movements and also look at the numerous ways in which to receive international payments as the ‘headline’ exchange rate is not necessarily an indication of the total cost of the transaction.
UK expat pensioners elsewhere in the world have also suffered from these exchange rate woes since 2015, with those in the US suffering a similar loss in purchasing power to those in Europe. Only South Africa has seen expat pensioners’ income rise (3%) as a result of exchange rate movements.