When planning your retirement in France, it is easy to get carried away thinking of afternoons spent on a leisurely game of péntanque or sipping a pastis on a sunlit square – but before you can enjoy those afternoons, it is important to take care of the paperwork that will ensure those daydreams become reality.
The value of your pension in France
However even when your status as a pensioner is recognised in France, your pension –whether a state or a private one- might still be calculated and paid in sterling. Often people retiring overseas fail to consider fluctuations in the currency markets. After the initial property purchase has gone through most people assume the exchange rate will stay largely the same once they’ve settled into their adopted country.
The impact of the EU referendum on the strength of Sterling has shown that retirees based overseas are vulnerable to sudden movements. Suddenly, budgets need to be reined in and the weekly restaurant treat can almost overnight become less affordable.
To appreciate the impact that these fluctuations, in the days prior to the Brexit vote, the sterling-to-euro rate was at 1.30. Following the result, we saw sterling fall dramatically to reach levels as low as 1.10 last November. For a UK pensioner living in France and having to repatriate a pension of £900 per month, this movement could mean a loss of up to €180 a month, or €2,160 a year.
There are, however, ways you can help protect yourself against any sudden currency movements. A currency specialist allows you not only to achieve a competitive rate, but also to fix the rate of exchange on your regular payments to avoid the impact that sudden rate changes can have on the value of your pension. Much like a fixed rate mortgage, you are able to plan and budget knowing that your income will stay constant for a determined period.
With a money transfer Specialist Company like moneycorp you are able to fix an exchange rate for up to two years and transfer payments on a monthly basis. Furthermore, should you need to transfer larger sums on an ad-hoc basis; you can instruct moneycorp to buy currency at a rate of your choice, known as a market order, so if a rate is reached an automated trigger is sent to complete the transaction on your behalf. It’s a great way to make your money go further without having to stare at a screen all day.
Buying your property in France
Your plan to retire to France might also involve buying a property and if this is the case you need make sure you also plan in advance the cost of the property and the best way to pay for it. moneycorp has decades of experience helping overseas property buyers with their foreign exchange requirements and the knowledgeable accounts team provide an expert service that can help you plan your budget and achieve a competitive rate of exchange, fixed and ready for when it’s time to sign on the dotted line.
Opening an account with moneycorp is free and carries no obligation, but will allow you to access to our free dealer analysis and market updates, so useful when planning a transfer.
Should you want to receive more information about rates and how to make the most of your international payments you can register for free with Moneycorp. Plus with FrenchEntrée you are entitled to FREE transfer fees on all your currency payments.
Call moneycorp on +44 (0)20 3773 6355 for more information or to discuss your currency transfer requirements. Receive free transfers on all your payments.