Offshore Pension Plans · For those of us who have spent some time working overseas, the decision to retire abroad ... However, as the saying goes: fail to plan, plan to fail! Retirement

The things you NEED TO KNOW about OFFSHORE PENSIONS

OFFSHORE PENSION PLANS GUIDE

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Offshore Pensions Guide

The allure of experiencing new places and interacting with different cultures is an attractive proposition to those who work or live abroad. Due to the nature of international employee contracts, expatriates often find themselves being posted to several different countries throughout the course of their careers. Mobile employees/expats are thus in prime position to take full advantage of offshore pension planning opportunities.

The demographics of retirement are changing with people living healthier and longer lives. We all have aspirations to retire on our own terms; this can be achieved with careful planning.

Offshore Pension Plans

Offshore Pension Plans are an attractive option for expatriates, as they can be held in a central location while they move around the globe.

As the new retirement landscape slowly emerges, it is more important than ever for expats to keep their finances in good shape while living or working abroad in order to avoid any shortfall in retirement savings. As such, the sooner you start your pension planning, the better the chance you have of being able to meet your retirement goals.

Welcome to the world of offshore pensions, where it is possible to access a wide range of funds whilst enjoying the benefits of tax free growth on investment.

The offshore pension industry was developed in the 1970′s when UK-based financial institutions established non-domestic fund management subsidiaries, targeting expatriated investors. Offshore funds are domiciled outside of the UK. They are therefore regulated by the authorities in the country where they are located. Established offshore investment centres such as the Isle of Man with their independent legal, political and regulatory framework, offer both tax efficiency and security to clients.

Tax efficiency and security

For those of us who have spent some time working overseas, the decision to retire abroad becomes a lifestyle choice.

Wherever you decide to retire, you will need to feel sure that you will have sufficient pension income to maintain an acceptable standard of living. It is therefore of great importance that your assets are safe-guarded, and invested in such a way that both you and your family are prepared for every eventuality.

Unpredictable events that may occur include volatile stock markets, low bond yields, inflationary pressures, fluctuating exchange rates, or even death. If you are one of the many expatriates who have decided to work or make a new home abroad, establishing an Offshore Pension Plan may be the solution for you.

Whether you are considering an overseas move, or you are already a working expatriate, establishing an Offshore Pension Plan may be an effective means of increasing the flexibility of your pension, while at the same time benefiting from tax-efficient growth.

An important part of pension planning is to have a strategy. A sensible strategy takes into consideration issues relating to both asset allocation and time to retirement:

• Greater risk with investments can be taken the

further away you are from retirement. Temporary

shortfalls caused by fluctuations in the market can

be smoothed out over time

• On approaching retirement age, it is advisable to

consider apportioning more of your wealth to less

risky asset classes, such as cash or bonds

• If you feel that you are not ready to retire, either

from a financial or career perspective, you

may decide to carry on working for longer and

supplement your income from retirement savings.

There is no secret formula to retirement planning. However, as the saying goes: fail to plan, plan to fail!

Retirement Strategies

Aspects of retiring abroad

Offshore retirement plans are designed by international banks or insurance companies and tailored for the expat community.

Common characteristics

• You can make contributions from anywhere in the world

• Contributions are flexible – you can increase, decrease, stop and restart contributions to suit your personal circumstances

• Premiums can generally be paid in Euros, Sterling, US Dollars, or Hong Kong Dollars

• A savings term is established at the outset of between 5 – 25 years

• You will have access to a broad range of investment funds

• The plan can be structured to take advantage of the favourable tax treatment offered to investors in certain tax jurisdictions

Offshore Pension Plans: Features & Benefits

Before choosing your offshore retirement plan, there are some additional issues for considerations. These include:

Retirement Destination – If you intend to retire abroad, it helps if you understand/speak the local language, and are familiar with the customs, cost of living and tax code of the country in question.

Timeline – Those that work overseas often enjoy a greater disposable income. This may enable them to save more and retire earlier. It is important to factor in the impact of inflation on your future standard of living.

Future Expenses – How much will you need to save for your retirement? Major expenses such as home purchase, vacations and medical bills should be factored into your retirement strategy.

Inheritance – Have you written a ‘will’? Is it your intention to pass on assets to your family or loved ones?

It is predicted that one in five Britons will retire abroad by 2050.

Additional Insights

In recent years, British nationals have increasingly been looking beyond the UK both for employment opportunities and a place to retire.

Several million UK nationals live overseas. Research by the Institute of Public Policy revealed that one in twelve Britons of UK pensionable age currently live abroad; they predict that this number will increase to nearly one in five by 2050.

An additional survey conducted by the insurance provider RIAS found that almost 10% of the UK’s over-50 population are giving “serious consideration” to moving to another country. Meanwhile, data from the Office for National Statistics suggests that 400,000 people in the over-50 age group are already planning to emigrate.

Moving abroad has a significant impact on the pension benefits of UK nationals. Many people who departed the UK shores in the past, elected to leave their UK pension behind them, with a view to revisiting the situation upon reaching retirement age and claiming the benefits then. Developments in legislation now provide individuals with the option to transfer their UK pensions overseas.

Retiring Abroad

DISCLAIMER

The information in this document has been prepared by AXIS Strategy Consultants SARL. The content contained herein, including any expression of opinion or forecast, may be subject to periodic amendment. AXIS therefore will not accept liability should such information no longer be current at the time of viewing. Nothing contained herein should be deemed as tax advice; moreover prospective investors should consult their own tax adviser in order to understand any applicable tax consequences in the jurisdiction in which they reside.

The contents of the document are directed solely at persons seeking information on Offshore Pension Plans in those jurisdictions or countries where access to the information contained herein and use thereof is not contrary to local law or regulation.

Any reproduction or unauthorised use of this content is strictly prohibited. No portion of this brochure may be extracted without express permission of AXIS Strategy Consultants. Unauthorised use of this content will be considered an infringement of this copyright and/or a misappropriation of the proprietary rights of AXIS Strategy Consultants.

AXIS Strategy Consultants, are a French regulated Courtier d’Assurance that specialize in retirement planning for expatriates throughout the world.

Offshore Pension Plans continue to be an attractive proposition for expats. As labour mobility becomes more mainstream, it is important that individuals seek professional guidance on retirement planning issues and the products on offer.

Please let us know if we can be of assistance?

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