Retirement and me: Expats discuss Brexit and their state pension after move to Portugal

From the food and culture to the weather and scenery, there’s no shortage of reasons why a person may choose to retire in another country. Having already been living overseas in France, one couple decided to settle in Portugal during their retirement. For this week’s instalment of Retirement and me, David John Griffiths Barnes, 68, spoke to Express.co.uk about his and his wife Marie’s, decision to reside on the coast, just north of Lisbon, nearly five years ago.

“We’ve been coming here on holiday for years, and property prices were quite good, and we like the company of the people, and so that was it – we decided we’d retire here,” David recalled.

Having sold their house in France, the couple moved to their new home.

The couple both have a private pension, and claimed the state pension at their state pension age.

For David, that was at 65, while Marie, now 67, reached state pension age at 66.

Their decision to move to Portugal, a country in the European Union, meant that their state pensions can continue to increase each year, as it would in the UK – unlike for some UK state pension claimants living in other countries in the world.

The couple have an account with Monese, who has recently commissioned research into retiring abroad.

According to the survey of 1,000 people with a nationally representative UK sample, 31 per cent of those asked said that they currently believed retiring abroad is “totally unachievable”.

Norris Koppel, CEO of Monese, said: “From our recent research, we know that over 15.5 million UK adults believe that retiring abroad is ‘totally unachievable’.

“This dream is increasingly unachievable with such a withdrawal of pension guarantees for British expats, and it is further exacerbated by the weak pound against the euro.”

Earlier this month, the Department for Work and Pensions (DWP) announced that nearly half a million people living in the EU will continue to have their UK state pension increased every year for the next three years in the event of a no deal Brexit.

The DWP also said that during this three-year period, the UK government plans to negotiate a new arrangement with the EU, in order to ensure that uprating continues.

Is the prospect of Brexit something which these expats are concerned about?

While the three-year guarantee has been announced, David said he thought it would be “disgraceful” if the uprating did not continue.

“I’ve contributed to the pension and there’s absolutely no reason really, wherever I lived in the world, why I shouldn’t get the same pension than I would if I was staying in the UK,” he said.

A spokesperson for the DWP said: “Nearly half-a-million people living in the EU will have their UK State Pension increased up until March 2023 in the event of a no deal exit from the EU. 

“During this three-year period the UK Government plans to negotiate a new arrangement with the EU to ensure that uprating continues.”

The research by Monese saw 18 per cent of respondents say they thought retiring abroad at this current time would be “somewhat unachievable”, while 31 per cent thought it was “totally or somewhat” achievable.

Express.co.uk asked David about his thoughts on whether Brexit could have an impact on UK expats living overseas.

“A lot depends on when they came over,” he said.

“The other problem is since Brexit the pound has probably shrank by about 20 per cent so if you have to transfer your pension over into euros this month, then the amount you get in euros is 20 per cent less than it was at the time of Brexit.

“So that’s brought your buying power down anyway.”

However, David pointed out that it could still be affordable to reside overseas.

“The other side of that is the cost of living in Portugal is so cheap, it’s probably still better off than living in England,” he said.

“The prices here are just incredibly cheap.

“Away from the tourist spots on the Algarve, we can go out and have a meal a three course meal, all the wine you can drink, and everything, for about lunchtime eight or nine euros, in the evening about 15 euros.

“Shopping’s cheaper, [as is] Council Tax – I paid 400 euros a year. In England I was paying £2,000 a year.

“So, although the value of your pension goes down with the fall in the pound, your spending power is still quite good.”

Read more from Retirement and me:

‘A no brainer’ How one woman tops up her ‘very small’ pension income

‘On my own with no pension’ Why one woman started a business at age 61

‘She should be retired’ How state pension age rise affected one couple

Couple ‘selling everything to survive’ after a life-changing accident

How one woman travels world 5 times a year – despite ‘limited’ pension

Two sisters – two very different pension payouts: Are you getting the right amount?