Advice on retiring and living abroad

fallex

Hi to all,

We are hoping to retire to Malta early next year.
By then I will be 58 and my wife will be 59

On retiring we intend to rent accomadation in Malta on a long term basis.

Our financial situation is as follows:-

We are both working full time at present.

I am in reciept of a naval pension of approx. £560 a month at present.

At 60 my wife will be in line for a small 18 year pension from the nhs in 2009
plus I presume her (slightly reduced) old age pension entitlement, we do not know the total amounts but suspect the monthly total would work out in excess of £300- £350.

Then when I reach 65 I have a small company pension worth about £125 a month. plus again I presume an old age pension, again suspect the total could be in excess of £400 a month.

So if I could be more concise

At present
total income from pensions £560 +
possible income from pensions in 2009 £300-£350 = £860-£910 +
possible income from pensions in 2015 £400 = £1260-£1310

Whilst we appreciate that this may not seem alot of money and there may be some tax liability on these amounts we have done our homework regarding rental costs for the type of properties we are interested in and feel that our
monthly income as and when the pensions from 2009 and then 2015 come on line so to speak will quite easily be covered plus normal living cost as our needs are quite frugal.

We do not know yet how much we would make on the sale of our property here in the UK as we have not had it valued yet, but suspect that it would be anywhere between £60,000 to £100,000.

The question I have is this does anybody have advice on where this money should be invested to give us the best possible return (on a monthly basis) as we feel that the first year 2008-2009 might be a little bit tight till the pensions start to kick in.
I would prefer to get any income in sterling as I know that I can get a better exchange rate locally than I can get through the bank although I,d be happy to be corrected.

My bank HSBC have suggested investing it offshore in Guernsey in different types of funds, I don,t know why but I,m not sure about this, it seems abit complicated.

Additional info we do have other money maxed out in two ISA,s and about £4000 in shares etc (we have really earmarked these funds for the actual move and possible purchases and legal fees)

Plus a small insurance policy for about £18,000 due in 2015

Hope this all makes sense.
Apologies for the length of the post but I hope some one might be able to give me some pointers

cheerfulcat

Hello, fallex,

No specific advice, but in general -

My bank HSBC have suggested investing it offshore in Guernsey in different types of funds, I don,t know why but I,m not sure about this, it seems abit complicated.

Presumably for tax reasons. Banks are not a good source of financial advice; you are better off going DIY or finding a specialist financial advisor.

I would prefer to get any income in sterling as I know that I can get a better exchange rate locally than I can get through the bank although I,d be happy to be corrected.

Unless you think that you might want to relocate to the UK at some point it makes more sense to have your income generated in the currency of the country you live in ( likely to be the Euro at some point, AIUI ). I would suggest that you think about this possibility very carefully indeed; I imagine that as you are receiving a naval pension you are well used to travelling but moving abroad on a permanent basis is still a pretty big culture shock and you may decide that you don't like it.

With £100,000 capital you can expect another £5000 or so in income p/a before tax. If you want capital and income to keep pace with inflation you'll need to take a certain amount of risk, which means stock market investments for at least part of it.

I think that you would be best advised to do your research before you do anything else, in particular your tax position ( including inheritance tax ) in Malta. It's also worth checking whether Malta is one of the countries where your UK state pension is not frozen. Worth checking, too, whether there are any local benefits payable...

EdInvestor

Try this forum:

http://www.britishexpat.com/expatforum/malta/index.php

Seems to be quite a lot of useful stuff there on pensioner financial issues.

zappa1

fallex wrote: »

Hi to all,

We are hoping to retire to Malta early next year.
By then I will be 58 and my wife will be 59

On retiring we intend to rent accomadation in Malta on a long term basis.

Our financial situation is as follows:-

We are both working full time at present.

I am in reciept of a naval pension of approx. £560 a month at present.

At 60 my wife will be in line for a small 18 year pension from the nhs in 2009
plus I presume her (slightly reduced) old age pension entitlement, we do not know the total amounts but suspect the monthly total would work out in excess of £300- £350.

Then when I reach 65 I have a small company pension worth about £125 a month. plus again I presume an old age pension, again suspect the total could be in excess of £400 a month.

So if I could be more concise

At present
total income from pensions £560 +
possible income from pensions in 2009 £300-£350 = £860-£910 +
possible income from pensions in 2015 £400 = £1260-£1310

Whilst we appreciate that this may not seem alot of money and there may be some tax liability on these amounts we have done our homework regarding rental costs for the type of properties we are interested in and feel that our
monthly income as and when the pensions from 2009 and then 2015 come on line so to speak will quite easily be covered plus normal living cost as our needs are quite frugal.

We do not know yet how much we would make on the sale of our property here in the UK as we have not had it valued yet, but suspect that it would be anywhere between £60,000 to £100,000.

The question I have is this does anybody have advice on where this money should be invested to give us the best possible return (on a monthly basis) as we feel that the first year 2008-2009 might be a little bit tight till the pensions start to kick in.
I would prefer to get any income in sterling as I know that I can get a better exchange rate locally than I can get through the bank although I,d be happy to be corrected.

My bank HSBC have suggested investing it offshore in Guernsey in different types of funds, I don,t know why but I,m not sure about this, it seems abit complicated.

Additional info we do have other money maxed out in two ISA,s and about £4000 in shares etc (we have really earmarked these funds for the actual move and possible purchases and legal fees)

Plus a small insurance policy for about £18,000 due in 2015

Hope this all makes sense.
Apologies for the length of the post but I hope some one might be able to give me some pointers

I know when we wanted to move from the U.K. we looked into moving to Malta.
There is quite a lot of restrictions about living there, I can't remember the income required I think it is about 10,000 pounds.
Worth looking into the requirements, because it is such a small Island they are very strict about who lives there.
Good luck

sleepless_saver

Looks like the conditions are exceptionally strict. Somehow I get the idea they don't really want people to move there permanently! And it looks like you have to buy a house there if you want to stay?

fallex

Apologies to all for not thanking you for the replies earlier but we have had
a problem with the computer and we,ve had the added upset of some gutless
moron shooting our cat.
Thanks EdInvestor for that link, some useful information there.

scubaleopard

So sorry about the cat-- what a horriblr thing to happen. Has the person been watching Chaos in the Chateau ?