How can I start my retirement planning?

Financially, expatriates could be said to be in a more privileged position than most - if a company chooses to send an employee overseas, it will usually give higher wages, expenses, and other perks. Expatriates can also find themselves with greater freedom when it comes to making investment decisions, as they are not usually restricted by the same regulations that domestic investors experience.

If you have a domestic pension plan in place prior to working offshore, you may find out after you move abroad that it is not as mobile as you are. Also switching from plan to plan as you change from country to country doesn't always make a great deal of sense. It can mean that the income you end up with in later life is fragmented and may be whittled away by foreign exchange costs or a cash-strapped government.

Sometimes, an international company will offer a pension plan to expat employees as part of their benefits package, but unfortunately this is nowhere near as common as it used to be. We are now in fairly lean times and many companies feel that it is not cost effective to offer decent benefits packages to more junior expatriates. They are more likely to concentrate on immediate benefits such as increased wages, so unless your employer is considerate enough to provide you with a benefits package tailored to suit your needs, the onus is on you as an individual to provide for your own retirement.

As we have said, moving a pension across a national border can at best add a further layer of complication, and at worst be downright impossible. So what are you to do? The most sensible solution would seem to be to find a safe place to anchor your retirement savings and / or investments so that you can move from country to country if necessary, without this having any negative impact on your assets. However if you decide to do this, you need to decide exactly where that safe place should be.

"What has the Offshore Market got to help me?"

Offshore financial centres present a viable solution, especially if you are undecided as to your eventual retirement destination. Basing your pension investment offshore should mean that future movements of capital or income are not impeded. However you should remember that any retirement income you take could be liable for taxation depending on where you are living at that time.

Unfortunately American expatriates and other expatriates that have been re-located to the States are more restricted in what they can do for retirement planning which is based offshore due to the US taxation regime. However the offshore market can bee of immense help to them.

The Retirement Plans that are available offshore are really just savings plans linked to investments which are "managed" by professional fund managers. They generally do not have the same restrictions that apply to UK and other Government Regulated Pension Plans.

Basically, with an offshore plan, it's your money and you can take it when you want, retire when you want and contribute what you want. (NB you usually have to run the plan for an initial period before you can start to access some of your savings).

You simply contribute regular amounts or a lump sum or both into your pension plan and then when you retire, you can take it all in cash or have a monthly pension or any combination of these two options. You can usually add extra lump sums into the fund say when you win some money or get a bonus or you could increase or decrease your regular contributions if your circumstances change.

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