Retirement Life

Wed, 16 May, 2018Danielle McCarthy

Pensioners retiring overseas because they can’t afford to live in Australia

Pensioners retiring overseas because they can’t afford to live in Australia

As senior Aussies struggle to manage with the increased cost of living and property prices, more retirees are relocating overseas.

In 2016, 11,660 Australians aged over 55 relocated overseas – a significant jump from the 7,910 who moved in 2005, according to ABS data.

The destinations that most retirees are choosing to move to include New Zealand, Italy, Greece and Spain.

If an Aussie pensioner lives abroad, access to their pension is reliant on several factors including the length of their time away, whether their assets or income have change and whether the pension is delivered through a social security agreement with another country.

Australia has 31 agreements with countries such as Italy and Spain that overcome barriers to pension payment.

However, if a pensioner returns to Australia after living abroad, and they travel outside the country for six weeks within two years of returning, they could receive payment cuts.

It is important for pensioners to log their travel plans through Centrelink’s online portal if they are planning on going overseas for more than six weeks.

"When looking at the aged pension it's always good advice to sit down with a financial planner before moving overseas permanently as everyone has different access rights and you may find yourself stranded," says Ryan Cullinan, an international financial adviser for Compare Return told the ABC.

Aussies who live abroad for more than five years, and permanent residents living overseas for more than a year, also forfeit the right to Medicare and don’t have to pay the Medicare levy.

In 2013, Norah Ohrt relocated to the Spanish town of Mortas. She lives in a three-bedroom loft and has breathtaking views of the old cobbled city.

With the reduced cost of food, council rates and water, Norah relies on her pension to cover all her bills.

She renovated her $65,000 home using her superannuation and is just one of the many Aussies who are tempting their Aussie friends to spend their retirement in another country.

"If you're on an Australian pension and struggling, I would strongly suggest that you look to alternatives, particularly if you have a second language that you can use," Norah told ABC News. 

Have you considered relocating and retiring in another country? Let us know in the comments below.