Expat pensioners worried about exchange rates this Christmas

Published by Rachel Lacey on 11 December 2017.
Last updated on 11 December 2017

Expat pensioners worried about exchange rates this Christmas

Expat retirees are tightening their belts this Christmas as the spending power of their income continues to reduce as Sterling slips against the Euro.

According to Equiniti – which manages pension payments to retirees living overseas - the value of their income is 20% less than two years ago - the last Christmas before the EU referendum.

The company says the Euro has fallen by 3% over the last 12 months, following a 17% drop in the year after the vote. The effects are being exacerbated by inflation, which is currently running at 1.5% across the Eurozone.

Expats in Europe aren’t the only ones to be feeling the pinch. Brexit-induced exchange rate falls are also being suffered in other parts of the world, with retirees from Australia, Canada, and New Zealand seeing their income drop by 14%, and pensioners in the US seeing their income fall by 10%.

Currency Purchasing power of a £5,000 pension % change
  30/11/2015 30/11/2016 30/11/2017  
Euro 6,986 5,778 5,598 -20%
Thailand Baht 265,005 218,900 216,150 -18%
South African Rand 106,700 85,800 90,200 -15%
Australian Dollar 10,246 8,247 8,767 -14%
Canadian Dollar 9,884 8,219 8,545 -14%
New Zealand Dollar 11,252 8,609 9,696 -14%
Swiss Franc 7,615 6,238 6,549 -14%
US Dollar 7,394 6,143 6,634 -10%
Jamaican Dollar 877,850 785,300 829,450 -6%
Philippines Peso 348,350 305,200 332,750 -4%

Source: Equiniti, December 2017

Andy Brown, operations director at Equiniti, says: “Expat pensioners are always at the behest of the currency exchange rollercoaster and the stumbling Brexit negotiations are not doing them any favours. Anyone hoping to retire abroad will have had plans seriously derailed by the Brexit vote and the currency fluctuations.

“It is important to understand the implications of currency exchange rate movements on your budget and shop around for the best value international payments as the ‘headline’ exchange rate is not necessarily an indication of the total cost of the transaction.”

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UK expect me to live on £5000

UK expect me to live on £5000 a year and even stopped winter fuel allowance, The only good thing is I can loose weight on what I have left to spend.