Quantative Easing Could Make Future Expats Poorer
Those that are set to retire and looking to do so abroad may get locked into lower pensions as a result of quantative easing
London, UK (Pryce Warner International) February 8th, 2012 – The Bank of England’s latest planned round of quantative easing (QE) is set to inject between £50-75Bn into the UK economy.
Industry experts have already suggested that this may wreak havoc on pensions as it can have the knock on effect of increasing inflation and thereby decreasing pension funds.
This is particularly problematic given the present high cost of living and low interest rates.
Another issue is that the future annuity of pension income is based on gilts. As demand is likely to rise for gilts in the wake of QE the price will increase and the yields reduce.
One means of combating this available to Expats is to invest in a QROPS (qualifying recognized overseas pension scheme). As QROPS are based overseas they would allow future Expats to sidestep the potential downsides of QE.
This is because QROPS do not require individuals to purchase an annuity and are arguably more efficient than SIPPs.
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By Aneil Fatania
Financial Editor
Pryce Warner International Group
For any corrections of factual information contained within our news items please contact our editor.
Email: af@prycewarner.com
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