Why are more and more Australians retiring overseas?
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Why are more and more Australians retiring overseas?

The number of Australians retiring overseas is on the rise. According to the ABS, there has been a 47% increase in overseas retirees over the past 10 years.

The most popular destinations? New Zealand, Italy, Greece and Spain, with other attractive countries including Panama, Portugal, Malaysia and Thailand.

But what has caused this trend?

One of the biggest factors is the increasing cost of living within our shores. Property prices are on the rise, and if you haven’t saved sufficiently beforehand, retirement can find you short changed. That’s where a move overseas, where your savings may last longer thanks to lower living costs, can seem appealing.

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Before you go

A life overseas may seem glamorous, and, coupled with reduced expenses, may even appear to be the preferred option, but there are definitely a lot of things you need to consider before taking the plunge.

Firstly, Australia has excellent aged care facilities and assistance. How does your proposed destination compare? If you’re living there for the rest of your days, will they be comfortable? Do you have family, grandkids that you’ll miss out seeing grow up?

There are also other financial issues outside of cost of living. If you are planning on maintaining income through work, then tax will be a consideration. If you are relying on your superannuation or the Age Pension, then you’ll have to confirm any residence rules that may apply.

Give yourself the choice

Retiring overseas is always an option, but it shouldn’t be your only option. If you are approaching retirement and are worried about the amount you have saved, it’s never too late to do something about it. With smart strategies in place now, you can increase your options at retirement.

The first step is to consider your future life. What do you want it to look like and how much will that cost you? Based on your current savings, do you have enough to cover this from retirement onwards? Get the most detailed picture you can, being realistic, and you can set yourself a real goal.

Bridge the gap

If you’re not there yet, start planning now to bridge the gap. Have you consolidated your superannuation into one fund? This can save on doubling-up of fees and insurances that, over the long term, can add up to a significant difference in your balance at retirement.

The tax-effective savings obtained from salary sacrificing into your super is another great place to start. By minimising the tax you pay now, you’ll get even more compounding gains. What other investment vehicles and structure might be suitable for you?

If this all sounds too difficult, then it might be time you consulted a professional. Financial planners are there to help you reach your goals. They have access to knowledge outside the reach of most ordinary people and can provide new insight into your retirement planning.

You don’t need to rule out retiring overseas, but let it be a choice rather than a necessity. Start planning for your retirement today to give yourself the option to live as you want. The earlier you begin saving, the easier it is.

Why not increase the financial savviness of those around you – pay it forward and pass on these tips to your family, friends and kids.

Olivia Maragna is the co-founder of Aspire Retire Financial Services and is an independent and respected financial expert. Olivia’s advice is general in nature and readers should seek their own professional advice before making any financial decisions.

You can follow Olivia on Facebook or Twitter at https://twitter.com/oliviamaragna