Where is best for you?
When it comes to pinpointing a specific area of France you should be moving to, it depends on what kind of life you wish to have. Bordeaux, a port town located in the southwest, is a very popular destination for recent retirees. Boasting an exuberant culture with many restaurants, art installations, and many fine wines, Bordeaux provides a reasonably-priced alternative to Paris. While Lyon, located in the east-central Rhone-Alps region, is often thought to be one of the best places to live in the country and is another cheaper option to residing in the capital (although not as cheap as Bordeaux).
The Brittany region is another top choice, offering a sunny climate, a wide range of scenery, and long coastline, while Normandy features seaports and plenty of rural countryside. Both Normandy’s and Brittany’s coastlines aren’t situated too far from the UK, making it easier to visit friends and family back home.
Wherever you choose, it’s vital that you complete thorough research to make sure your location suits your desired lifestyle.
How expensive is France?
Proper budgeting is crucial in the planning of how and where you are going to spend your retirement abroad. With the commonly romanticised image that the country has, you may be forgiven for thinking that the cost of living in France will run to very high amounts. While it’s true that Paris is expensive, once you venture outside the ‘city of love’ it turns out to be, in general, less costly than the UK.
Overall, public transport fares, petrol prices, property rental costs, and restaurant prices are all slightly lower in most of France than they are in the UK. You could also notice a drop in your utility bills, with water, electricity, and heating all costing a lot lower on average than in the UK (although internet and phone bills tend to be higher).
Even if you do want to live in Paris, your day-to-day living might not be as expensive as you initially expect. For instance, there would be no need for a car; public transport is relatively cheap and efficient (a Navigo pass, which allows you access to all public transport, can be purchased for €70 per month). The Metro and bus service means that all destination within the city are never more than 45 minutes away.
Under the current EU law, if you are a British retiree heading for France and have filled out a form S1, you will be entitled to the country’s healthcare system without the need of paying into the French social security system.
Setting up a QROPS
What to do with your pension is another issue that needs to be addressed, and if you are considering retiring to France, then moving your pension fund into a QROPS (qualifying recognised overseas pension fund) may be the best option for you. By doing so, a number of financial advantages become open to you.
You can remove a 25% tax-free lump sum (in line with HMRC guidelines). Plus, you will extend your investment options, can start taking benefits from age 55, and, since the fund falls outside your estate, you can reduce or remove the tax liability at death, meaning that your heirs could potentially receive the entirety of money left behind. As a word of caution, however, the tax percentage on large incomes in France can be quite high, so be cautious of taking large amounts from your fund at any single time.
To make use of these benefits, you must transfer your pension into a scheme recognised by the HMRC. Here is a comprehensive, up-to-date list of all the qualifying schemes in the world that meet the requirements of the HMRC.
If you are considering moving your pension into a QROPS, then we recommend that you contact one of our financial experts in France beforehand to ensure that it is the best decision for your money.
Adjusting to the culture
And finally, there are a few other things to consider. Many expats report an initial struggle to fit in with the culture as making new social connections can sometimes be tricky. Making the effort to learn the language is a good first step to fitting in and then France will be your oyster – or huître if you will..
When it comes to France, many expatriates are happy with their decision. If you are planning to make the move but are worried about manging your finances, the Blacktower team is here to answer any queries you may have.
This communication is for informational purposes only and is not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice from a professional adviser before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained in this communication is correct, we are not responsible for any errors or omissions.
“Fortunate, indeed, is the man who takes exactly the right measure of himself and holds a just balance between what he can acquire and what he can use.” These words, written by The eighteenth century English physician and educator Philip Latham, could just as easily have been written about trying to achieve the balance between spending happily in the present and saving prudently for retirement.
Well, you have probably already swept away the party poppers and Champagne corks, but now is the time to reflect on 2017 and consider the future.