5 Things To Think About When Taking Early Retirement Abroad

###Retiring early… and abroad? You’re living the dream.

But what do you need to start thinking about when making this sort of decision? Our short guide is packed with information about the issues you need to consider, from pensions and taxes to healthcare.

####1. Can You Afford It?

Having a realistic view of how much your new lifestyle is going to cost is vital and relying on a “back of the envelope” calculation can leave you in a perilous situation. Work out what day to day living is going to look like - and start researching from there.

For example, petrol can be surprisingly expensive in countries that are otherwise cheap - so living in rural Portugal (where petrol prices are higher than the UK) can prove pricey if you are going to need to drive long distances to get to the nearest town. Take a look at our guide to the [financial implications of retiring abroad] (https://wise.com/gb/blog/implications-for-your-finances) for some more detailed information and advice.

####2. What Will Happen To Your Pension?

This can be fairly complicated, so make sure you read our in-depth guide for a useful overview of what happens to both state and private pensions when you retire overseas. If you are retiring early, there is sometimes also the option of moving your pension overseas before you begin drawing on it, by transferring it into a Recognised Overseas Pension Scheme (ROPS).

This can be based in your new country of residence, or offshore. It is a more flexible option, and you won’t be responsible for paying UK taxes on that pensionable income once you have spent five years living outside the UK. If you are planning on keeping a UK bank account and having your pension paid into it, you can cut down on transfer fees when sending that money abroad by using a secure service such as Wise.

####3. Will Retiring Abroad Have An Effect On Your Taxes?

Depending where you move, retiring abroad can have a huge effect on your tax situation - in the worst case scenario you will be taxed twice on the same income. The good news is that many European countries have a tax relief agreement with the UK, meaning that you only pay once.For more information on this, and also the effects of moving abroad on capital gains tax, tax on savings and inheritance tax, take a look at our tax guide.

####4. What Should You Do With Your Property?

Many people who choose to move outside of the UK on retirement have one or more properties in Britain, either with or without a mortgage. There are many things to take into account when deciding what to do when leaving property behind. Whether you want to keep them for rental income might depend on the tax situation in your new country - in some circumstances that income could be taxed in both countries.

Selling your home could give you enough money to buy a new place outright in your new country... but then you have nowhere to return to if it doesn’t work out. You might want to look into the possibility of a “reverse mortgage” - a financial product specifically for people 55 and above. It's designed to release some of a property’s equity in the form of a lump sum or a line of credit over time - which could effectively work as a monthly income.

####5. What Are The Healthcare Implications Of Retiring Abroad?

Leaving the comfort of the NHS later in life can be a difficult decision, and people retiring abroad from the UK should certainly take this into account. If you are staying within the EU and drawing a UK State Pension however, there is good news: the NHS could still cover your healthcare costs in your new country of residence. Call the International Pension Centre for more information and the relevant forms.

We’ve put together a guide to answer some of the [common health-related retirement questions] (https://wise.com/gb/blog/implications-for-your-healthcare), aimed specifically at people thinking about moving abroad. There is so much to think about with a big decision like this - but take heart from the fact that thousands of Britons retire abroad each year... and you could be one of them.