Labour policy limits pension increases for British retirees abroad

Retirees living in certain countries may lose out on a State Pension increase of 4.1% coming in April, according to experts. This could affect nearly 500,000 British expats. A Labour government policy prevents annual increases for those living in specific regions. The State Pension usually rises each year thanks to a "triple lock" system. This means payments increase based on inflation, average wage growth, or by 2.5%, whichever is highest. However, in some countries, pensions may be "frozen" at the rate they were first paid. William Cooper, from a health insurance firm, highlighted the importance of understanding how living abroad can impact pension payments. He noted that pensions might continue to grow in countries with a social security agreement with the UK. For those who want to transfer their pension, options like a Qualifying Recognised Overseas Pension Scheme (QROPS) could offer advantages. Cooper advised that retirees should look for recognized QROPS providers and consult financial advisors who specialize in international retirement planning. They can help navigate aspects like taxes and local regulations. Before making a transfer, pensioners should get a transfer value quote from their current provider. This figure will show how much can be moved to the new QROPS. Following this, they must complete the necessary paperwork for the transfer process. Cooper emphasized that careful planning can help ensure that pensions continue to work effectively for retirees living abroad. By following these steps, pensioners can maximize their benefits and ease the transition to life in another country.