With affordable property set amid some of Europe’s most idyllic countryside and an enviable lifestyle, it’s easy to see the appeal of retiring to France. But is it really possible to make the move to France, and what steps do you need to take to make the dream a reality? Here are the six things you need to think about before retiring to France.
1. Can you get a visa and residency card in France?
The very first thing on your list of considerations is whether you are legally allowed to retire to France. Whether you are moving to France to live, work, or enjoy your retirement, you will need a right to residency in France, and this often means applying for a visa or residency card (Titre de Séjour).
If you are a citizen of a European Union (EU) or European Economic Area (EEA) country, you have the right to retire to France and do not need to apply for a visa and/or residency card. However, any retiree from a non-EU country (including the UK after Brexit) will need to go through the process of applying for a visitor visa, followed by applying for a residency card.
This is a multiple-step process, and there is inevitably a lot of paperwork involved. You will need to meet certain criteria to reassure the French authorities that you have the means to support yourself throughout your retirement. Read our guide Retiring in France: Visas & Path to Permanent Residency.
2. How will you receive your foreign pension in France?
Most retirees will be relying on a state or private pension fund (or often, both) when they retire, and there are several choices to make when receiving an overseas pension in France.
Firstly, think about how you will receive your pension. Would it make sense to transfer your pension to an EU pension scheme, for example, using a QROPS (a popular option for British workplace pensions and SIPPs)? Should you have your state pension paid directly into your French account (if it’s possible to do so), or should you keep your funds in your overseas account to take advantage of more favourable currency exchange rates?
See our guide to Pension Options When Retiring to France- Planning for Your Future.
Secondly, you want to consider the most tax-efficient way to receive your pension. British retirees might want to take a 25% lump sum before moving to France to benefit from the UK’s tax-free allowance. Alternatively, you might decide to withdraw your entire pension to benefit from France’s low taxes on lump-sum pensions, then reinvest in tax-efficient savings plans such as an Assurance Vie.
See our guide to Paying Tax on Your UK or Overseas Pension in France.
3. What health insurance coverage do you need?
Registering with France’s state health service is mandatory for all legal residents of France, but French healthcare services are not free. Depending on your circumstances, you may be able to receive an S1 form entitling you to access the healthcare system, or you may be liable to pay social security contributions (cotisations/contributions sociales) on your pension and/or taxable income. A top-up insurance or mutuelle is also highly recommended, especially for pensioners.
Most importantly, in order to register with France’s health system, you must have been resident in France for a minimum of three months, and you will need private health insurance to cover you for this period. Most long-stay visa applications require retirees to hold a private international health insurance policy for the duration of the visa – 12 months – in order to qualify for the visa.
See our guide to Healthcare for Retirees in France -Your Options.
4. How will you manage your global finances from France?
We’ve already mentioned pensions, but many expats also own foreign property or have other financial assets, investments, or other savings overseas. When you become resident in France, you will be liable for French tax on your global income, including capital gains tax, wealth tax, and income tax. Tax-efficient savings and investments that served you well in the UK or United States, for example, may now suddenly come with a large tax burden.
Currency exchange rates will also play a large role of you are living between two currencies. You could face substantial losses on transfer fees and currency rate fluctuations if you don’t plan ahead.
Before you make the move, take the time to read our guides to Banking in France, French Currency Exchange, French Tax, and Wealth Management, or consider booking an appointment with a financial advisor who can advise on your personal situation.
5. Do you understand French inheritance and succession laws?
Estate planning can be challenging at the best of times, but French inheritance laws can be a minefield if you don’t understand their implications. In France, ‘forced heirship’ rules mean that up to 75% of your estate will be automatically distributed to your children upon your death. Inheritance tax can also be high if you choose to leave assets to step-children or non-relatives. In France, it is the individual, not the estate, who is taxed, meaning that even if the recipients are not resident in France, the tax implications could still be up to 60%.
Seeking advice on inheritance planning should be done before you retire to France, and it’s crucial to consult an advisor that fully understands the implications of both French and British or American law (or laws of the relevant countries). There may be a way to elect for your estate to fall under the law of your country of citizenship or more tax-efficient options for gifting or leaving assets.
6. How will you adapt to the French language and lifestyle?
Moving to another country always requires a period of adaptation, whether that be learning a new language or settling into new routines. Retiring to France is an exciting step, but it can sometimes be more challenging than expected, especially for pensioners who are already adapting to the different pace of retired age.
It’s a good idea to spend as much time as you can in France before deciding to make the move – visit your French home in all seasons (life at your idyllic country farmhouse may be very different in the depths of winter!), familiarise yourself with everyday life in France, and build up a community of English-speaking expats and French neighbours and locals.
Our guides to Local Life in France are designed to help you settle into your new life in France and will talk you through all number of everyday tasks and essentials, from visiting the déchetterie (the tip/recycling centre) or going to the hairdresser to who to call in an emergency.
Retiring to France?
From applying for residency and understanding your pension options, to life in France for the over 60s – FrenchEntrée is here to help! Let our Essential Reading articles guide you through the whole process, then visit our French Tax, Healthcare, Wills & French Inheritance, and Life in France zones for everything else you need to know.