Pension savings often provide important financial support for those who have departed the workforce. Having been built up over a person’s working lifetime, a pension can help individuals reach retirement goals, and to cover the cost of living. Brexit, which is forging ahead, is likely to create a number of changes, but many retired people will want to know how the end of the transition period could affect their pension pot.
Express.co.uk spoke to Hayley Millhouse, Managing Director at OpenMoney Advisory Service, about the matter.
She provided insight into impending changes, and how certain individuals may be affected.
Ms Millhouse said: “If you are a UK resident paying UK tax there will be no changes for you to note at present.
“However, the real changes are for those who are expats, or people who are thinking about retiring in the European Economic Area (EEA), and there are certain things which should be considered.
“A lot of the high street banks are now writing out to EEA customers saying that if you have a bank account with them, they are going to close it.
“If you are getting a pension fund paid into one of those bank accounts, it is really important that you reach out to your pension provider to have a look at what your options are.
“Unfortunately, that could potentially come with some disadvantages, particularly with regards to a potentially poor exchange rate, and also some hidden fees depending on what country you reside in.
“In this case, doing your research is going to be key and also just making sure that you plan ahead.
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“Ensure you have sufficient funds in place for living expenses, just in case you are impacted or there are delays in your banking arrangements.”
Taking action ahead of the end of the Brexit transition period is likely to be key here.
This will mean Britons who have retired, or plan to retire abroad, will save themselves from stress and panic as the deadline draws closer.
Ms Millhouse continued: “Sometimes it’s quite easy to put your head in the sand, but there could be quite serious consequences if you don’t plan for this.
“There are several steps you will potentially need to take when it comes to December 31.
“Firstly, you should understand what your financial position is. What can you currently afford, and what would happen if you didn’t have access to your pension in the short-term.
“Next, consider what the stance of your pension provider is, because this is likely to provide the certainty you need moving forward.
“Then, you should be looking at what kind of local arrangements can be put in place for when you plan on receiving that money.
“There are going to be changes, but how you approach them is important.”
Discussions between Britain and the European Union are ongoing at the moment.
This means it is not yet clear whether a deal will be in place by December 31, 2020.
Such a deal could outline protections for those with pension arrangements, and potentially make the process slightly easier.
However, overall, it is sensible for Britons to plan ahead, in case the country does face a no-deal situation.