More and more French retirees are moving abroad. Anne Dayraut, a journalist specializing in this area, gives her advice on Europe 1.
Spending your retirement abroad... the idea is appealing to more and more senior citizens. According to a 2014 report by the French retirement insurance company Assurance-retraite9.1% of retirees, or 1.25 million people, live abroad or in a French overseas territory. "A more comfortable standard of living, the sunshine and financial reasons, including the desire to avoid paying taxes" are the main reasons for moving, notes Anne Dayraut, a journalist with the French newspaper The private individual and guest on Europe 1 on Thursday. But like all departures, those of retired expatriates need to be prepared.
- Take all ancillary costs into account. The financial gain is real when retirees decide to go abroad. But certain additional costs are sometimes overlooked: "In particular, the need to return to France and fly back and forth are forgotten," notes Anne Dayraut. "Health costs are also higher everywhere else than in France. We're very young when we retire, but we're going to grow old and have health worries, so we have to hedge a lot of things, think about our estate in particular before we leave."
- No taxes, yes... but. Going abroad for your retirement doesn't always mean no longer paying taxes in France: it depends on the country you decide to go to, whether it's a European Union country or not, and whether there are tax treaties in the countries you're going to. It also depends on the type of pension you're drawing: "If you're an employee in the private or public sector, the conventions won't be the same," explains Anne Dayraut. "In general, when you draw a public pension, you still pay taxes in France. You can't plan to move abroad without first carrying out a complete financial and tax study."
- Choose your country carefully. Portugal is one of the most popular destinations for retirees. The country has launched a major communications campaign to make itself attractive a few years ago promising foreign pensioners no taxes on their retirement pensions for ten years. Beware, however, that "at the end of the ten-year tax-free period, retirees fall back into a classic tax system that is fairly equivalent to the French system", warns the journalist. But the country has other advantages: it's very close to France, it's pleasant to live in, and real estate and the cost of living are not very expensive.
Other countries are also popular with white-hairs, such as Morocco, which has signed agreements with France, and Thailand, which is further away but has its share of enthusiasts.
- Language can be a problem. The language barrier can be a real hindrance to the comfortable lives of expatriate retirees. "In a survey carried out, 50% of retirees who had left said that the language barrier had been a problem, and 20% said that it had been too great a barrier for them," explains Anne Dayraut.