According to Unbiased, there are currently more than 230,000 Brits enjoying retirement in Australia.
Given the longstanding close ties between the two countries, it’s no surprise so many have chosen to see out their years in a country that offers a high quality of life and so many other benefits.
So, if you live in Australia and you’re planning to retire soon, read about some of the reasons so many people choose to spend their retirement years thousands of miles from where they grew up.
1. The warmer weather is a big attraction
Australia’s climate has made it an increasingly popular destination for retirees who are looking for warmer temperatures, rather than struggling through cold winters.
For example, the average temperatures in Sydney in the coolest winter months of June and July are still a very comfortable 17C (62F) – the same as a decent spring day in the UK.
The average winter temperature is lower further south in Melbourne and, conversely, higher as you head north towards Brisbane and west to Perth.
The highest summer temperatures in the northern half of the country can be challenging, with air-conditioning close to being a necessity. But the inconvenience of having to spend some time indoors to escape the heat could well be offset by the overall warmer temperatures you’ll enjoy throughout the rest of the year.
2. You’re able to enjoy more of an outdoor lifestyle
The better weather inevitably means that far more time is spent outdoors than in the UK.
They may have become a bit of a cliché, but there’s a lot of truth in the images of families and friends gathered around the barbecue, enjoying life al fresco.
Beyond eating and drinking, the weather and geography provide lots of opportunities to indulge in outdoor activities for most of the year.
According to Travellers.com, more than 85% of Australians live within 50 kilometres (31 miles) of the coast, so a lot of those activities are driven by the proximity to the sea.
3. The lack of a language barrier can make acclimatising easier
One benefit for Brits living in Australia is the shared language.
Although some British retirees in Spain and other European destinations seem to get by with little more than holiday phrasebook English, it clearly makes a big difference to know you’ll be understood in your own language.
This can be particularly important if you’re older, when learning a new language from scratch could prove more challenging. It also means there’s no danger of stressful situations when you’re struggling to make yourself understood.
That’s not to suggest that you’ll find Australia overly Anglicised and introspective. It’s long been a magnet for immigrants of many nationalities. This means that you’ll find that the big cities, in particular, are melting pots of different languages and cultures.
4. Your pension could go further
If you’re over the age of 55, you may be able to create a highly advantageous situation for yourself by transferring your UK pension fund to an Australian super by means of a Qualifying Recognised Overseas Pension Scheme (QROPS).
The reason why it’s so beneficial is that, unlike in the UK, any income you draw from your super fund in retirement is free from tax.
This obviously gives you a big boost in terms of the buying power of your pension.
You should be aware, however, that not all UK pension schemes can be transferred in this way. We would strongly recommend that you read our previous article on QROPS for more information.
Receiving your State Pension shouldn’t cause any difficulties if you retire to Australia. You can have it paid into an Australian bank account and benefit from bulk currency purchase.
However, it’s important to note that it won’t increase annually once in payment, and you should factor that into your retirement plan.
Automatic increases on other UK pensions, such as the NHS scheme, may apply if you’re living in Australia.
5. Modern technology makes it easy to keep in touch with the UK
One relatively recent benefit of retiring in Australia is the way modern technology can help you keep in touch with family and friends back in the UK.
So, even though you’re thousands of miles away, you can still keep up with the news from the UK.
This means it’s far less of a wrench leaving children and grandchildren back in the UK than it was for previous generations of retirees who had to rely on mail and expensive phone calls.
Furthermore, flight times to and from the UK are becoming less onerous. It’s now possible to fly direct from the UK to Perth in just 17 hours.
6. The UK property value boom means you should get more for your money
If you’re looking to retire in Australia, it makes sense to put down some permanent roots. One of the most obvious ways of doing this is through buying a place to live if you haven’t already done so.
The UK property price boom of recent years means if you’re selling up in the UK with the idea of using the accrued value to buy in Australia, you’re likely to get more for your money.
Alternatively, you may find you don’t need to spend as much for an equivalent-sized property, leaving a handy surplus to cover some of your other retirement costs.
However, it is important to note that the housing market in Australia does not typically offer buyers the type of returns you’ve probably experienced in the UK.
As in the UK, there’s a big variance in property prices depending on where you want to live. Typically, the further away a property is from a large city centre, the cheaper it will be. For example, you’ll get far more for your money if you live in one of the outer suburbs of Melbourne or Sydney than you will in the middle of the city.
Getting expert advice is important
Whatever your current plans, retiring in Australia is not a decision to be taken lightly.
If you do decide to go ahead, it will take careful planning, particularly around the critical issue of your finances.
Because of this, we would strongly recommend that you seek specialist advice from experts.
There are some common pitfalls you need to steer clear of, and an experienced adviser can help you avoid them. They will also be able to help reduce much of the stress involved and ensure you can go into retirement with the confidence that you have clear and robust plans in place to move you forward.
You should find our guide about helping Brits retire in Australia useful.
Get in touch
To find out more about planning for your retirement, please get in touch with us.
The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
This article is for information only. Please do not solely rely on anything you have read in this article and ensure that you conduct your own research to ensure any actions you may take are suitable for your circumstances.
All contents are based on our understanding of ATO and HMRC legislation, which is subject to change.