Your dream of buying a property in France could come true – thanks to your pension.
This month, changes to the pension rules are set to revolutionise the way we take an income in retirement. Those over 55, with a suitable pension plan, will be able to access their accumulated savings with complete freedom. Instead of being forced, under Government rules, to convert their savings into chunks of guaranteed annual income (annuity), they will be able to take their whole pot in one lump sum or withdraw money from their account when necessary. This pension freedom means a huge amount of money will be freed up for the over 55s, to save, invest or spend.
Having worked hard to generate your pension fund in order to provide an income after retirement, you should give careful consideration to how you are going to use this money. However, that doesn’t mean you have to be limited in your choice of investments. France has long been one of the most popular destinations for Brits looking to buy property abroad and now is a great time to invest across the Channel.
Whilst there is a need to consider regional variations in France, continued troubles in the Eurozone mean property prices are still low and market activity subdued. Added to this, sterling hit a 7-year high against the struggling euro in March 2015. Following Greece’s recent economic woes, the threat of the country leaving the EU and the introduction of large-scale quantitative easing,the rate reached £1=€1.40.
So, if you’ve benefited from the recent UK pension reforms and you harbour dreams of owning a property in France, the strong pound means your dream could become a reality. For example, the exchange rate in March 2014 was €1.19, meaning a property valued at €250,000 would have been priced at £210,000 for a UK buyer. 12 months later, with the rate at €1.40, the same holiday home was priced at £178,500 in sterling terms. A huge saving of £31,500, due to the euro’s decline.
For those aiming to capitalise on the improved exchange rate, using a currency specialist rather than your bank could help make your money go further.
When you’re considering transferring foreign currency, you would be forgiven for thinking your high street bank is the obvious choice. Most people do. However, this may not be the most cost effective option, as the banks may not typically offer the most competitive exchange rates. To take advantage of the pounds current healthy position against the euro, you should consider talking to a foreign exchange specialist. Moneycorp offer exchange rates that are typically 3-4pc more attractive than those available from the banks. This could save you as much as £4,000 on a transfer of £100,000 – that saving could free up money to cover your legal fees or to make renovations on your new property.
As well as bank beating exchange rates, as a limited offer to French Entrée clients that open a trading facility, Moneycorp offers free transfer fees for life. When you consider that high street banks can typically charge £20 to £40 each time you make overseas payments, this alone could save you large sums of money if you are making regular international payments.
Should you want to receive more information about rates and how to make the most of your international payments, please register with Moneycorp by clicking here , it does not involve any cost or obligation, but allows you to speak to an expert dealer and access live rates whether in the UK or in France. Alternatively you can send them an enquiry. Plus if you register via Frenchentrée, you are entitled to FREE transfer fees on all your currency payments.
For more information, please visit www.frenchentree.com/french-property/france-currency-exchange or call +0044 (0) 20 3773 6355.