Equiniti Paymaster currently administers the payroll and international payment of pensions for over 50,000 expat pensioners, many of whom are former public sector workers receiving an average pension of around £5,600 a year*.
The largest proportion of these 50,000 pensioners has retired to the Eurozone (12.45%) where someone who retired in 2003 will have seen the purchasing power of their pension fall by 22%.
Someone with a £5,000 pension would bring in just under 7,300 Euros ten years ago, whilst the same pension amount would now bring in only 5,692 Euros.
The biggest losers are people who moved to Australia as they have seen their pension drop from AUD 13,625 to AUD 7,253, a drop of 47%.
Conversely, pensioners in South Africa and Jamaica have both seen an increase in the buying power of their pension over the past ten years.
Keith Boughton, Director, Equiniti Paymaster said; “Ten years ago the value of Sterling was significantly higher than it is today, and those emigrating abroad for their retirement enjoyed considerable value from their pension. A plummeting pound has left many expat pensioners unable to make ends meet and struggling to find other ways to protect the value of their pensions.”
NB. The exchange rates used in this example are based upon actual rates achieved in March 2013.