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Retirement in Spain
Retiring to Spain is a dream which, happily more and more people are able to realise. Once your children have grown up and your job no longer ties you to a cold and wet climate, then the idea of retiring abroad can be very appealing.
Not only is the weather in regions such as Spain's south east coastlines much more cogenial but property prices are still very affordable. Spain, with 300+ days of sunshine and a rich abundance of all the good things in life, is becoming the most popular retired persons haven.
The Costa Almeria and the Costa Calida, are developing quickly now because of the supply of attractive and affordable housing and the limited travelling time between Great Britain and Spain.
So you want to retire?......but can you afford to yet?
When can you retire?
A company or occupational pension carries its own rules, and retirements can be anytime from 60 to 75. From December 2006, though, it will be illegal for employers to make people retire at a certain age. Most private pensions let you start drawing an income from 60, although from 2010 it will be 55.
How much have you got?
In terms of your pension, probably not quite as much as you'd hoped for. The income you receive today will be much lower than it was 10 years ago. This is because of lower interest rates, a badly performing stock market and improved health which means you'll live longer, so your money has to stretch further. However, some companies offer their employees a pension where some of the investment risk is taken away, and staff are guaranteed part of their pension pot. This gives them a more predictable pension when they reach retirement.
Since April 2003, private pension providers and companies that offer money-purchase schemes have to send you annual notices on how your fund is doing and what you can expect to receive when you retire. Don't forget to add in your calculations other pension schemes, your state pension, lump sums from pensions, and funds from insurance policies and ISAs.
Early retirement
For many, the chance to retire early is an exhilarating option. There's probably no mortgage to pay, no National Insurance contributions, a lower tax bill, no work expenses like travel costs, and of course, no more pension payments or life insurance contributions linked to it.
However, you must weigh up the costs - freedom versus income: if you start drawing your pension at 50 you'll only get a fraction of what you could have at 60. And if you don't have any other investments to help you each month, that longed-for freedom might statrt to seem like a sentence.
What to do next
• Seek financial advice and review your investments.
• If you are thinking of retiring to Spain - we can help you find the right property to suit your circumstances.
Investing in Spain
• If you are seeking an investment, then buying carefully selected property in the right location in Spain will present a great opportunity in 2005.
Buying Guide
• Are you tempted by the thought of spending the winter months in a warmer climate but don't want to sell your home? Renting out your property is a good way of covering the costs.
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