Our top 7 tips for Australians retiring in the UK

Category: News

A successful retirement takes careful planning.  Retirement is never a straightforward process and, if you’re an Australian settled in the UK, that can make it even more complex.

So, it’s never too soon to start the planning process.

To help get you focused, here are seven top tips for Australians looking to retire in the UK. These clearly aren’t the whole story, but they should give you a good starting point and help you get the retirement you’ve worked hard for when you finally decide to stop work.

1. Have a plan in place

It’s an old cliché, but failing to plan often means you’re planning to fail.

Take some time out to start thinking through when you want to retire, and what you want to do once you finish work.

Also think about where you want to live. Is your aim to move back to Australia at some stage? Or are you happy here and just intend to go back to visit regularly?

With that information to hand, you will then have a decent idea of the retirement income you’ll need, and the fund you’ll need to finance your retirement.

It will also tell you if continued saving will still be a priority, and whether you’ll need to make any changes to your expenditure.

2. Review your retirement assets to check you have enough

Most of your income in retirement is likely to come from pension savings – here in the UK, or any super fund you have in Australia.

Make sure you have values and projections of these and make sure you know the full details and terms of any arrangements you have, including how they are invested and when you’re eligible to start taking benefits.

On top of your UK and Australian pensions, make a note of other assets you may have that will support you in retirement.

These could include:

  • Your State Pension in the UK
  • Savings, such as Individual Savings Accounts (ISAs)
  • Other investments such as shares or an investment portfolio
  • Property, both here in the UK and in Australia.

With all this information to hand, you’ll have a clear idea if you have enough to retire on.

3. Check your expenditure

Once you know what assets you have, you’ll have a decent idea of what your income will be in retirement, considering inflation, potential growth on your investments, and taxation.

If you’ll be transferring assets from Australia, you should factor in exchange rate fluctuations. Also check your official residency status, as this could impact on the tax you’ll be paying.

Then list your current expenditure and consider how much of this will still be relevant once you retire. Don’t forget to include any expenditure back in Australia.

4. Make sure you’re as debt free as possible

One way of increasing the amount you have to spend is by reducing your debts or, better still, clearing them totally.

Credit card and personal loan repayments make a real dent in your disposable income each month, so by clearing them you’ll automatically be giving yourself an income boost.

If you have debts, put a plan in place to clear them as soon as possible. You might even want to consider using some of the savings you’ve earmarked for retirement to ensure you have as little debt as possible.

5. Decide if you will continue working

It may sound contradictory, but once you have retirement plans in place, you might decide that you’ll continue working for a time.

“Phasing” retirement is now common. Many people are now happy to work part-time – either in a different job, or on a consultancy basis with their current employer. If you own your own business, you might not want to let go of the reins straight away.

Winding down gradually can often be better than stopping work one day and starting retirement the next. It can enable you to make further pension contributions and reduce the amount you take from your savings when you first retire.

6. Review your investment strategy

How your money is invested will be crucial to ensuring that your fund will last long enough and be sufficient to allow you to enjoy the retirement you deserve.

You may want to consider setting aside a few years’ income in savings. Sudden investment market turbulence could seriously impact on the value of your fund, so by doing this you can protect your income for a short period, giving your fund time to recover after a sudden downturn.

Given how crucial investment performance will be during your retirement, we would strongly recommend you get expert advice, and ensure you are reviewing your investments regularly.

7. Get professional financial advice

Planning for a successful retirement is complicated and can be daunting.

It is likely you will have assets in both the UK and Australia, which adds an extra layer of complexity.

A financial planner will be able to assist you with all the steps we have outlined here, and help you put a detailed plan together to ensure you make the most of your savings and enjoy the retirement you have planned.

Get in touch

At bdhSterling, we believe we are uniquely positioned to help you with your retirement planning.

We’re dual licenced meaning we’re able to provide financial advice in both the UK and Australia and have helped many Australians in the UK plan for their retirement.

Get in touch to find out how we can help you with your retirement planning.