Brexit is the likely culprit behind the drop in the number of UK pensioners living in the European Union.
Figures from investmet platform Easymoney showed that there were 466,920 such expats living across Europe, the lowest level in five years and the second consecutive year-on-year decline.
Perennial hotspot Spain reported the biggest decrease with 1,590 retirees leaving the country between 2018 and 2019, the latest period for which figures are available.
This makes up for around 80% of the EU-wide drop during that period.
Officially, the Iberian country is now home to 105,206 UK pensioners, although this is likely much higher as many have not formalised their residency status.
The figures reflect the number of expats claiming a UK state pension in EU countries.
According to Easymoney, Brexit might have played the biggest role in this, with Brits fearing of losing residency and social care rights after the departure from the EU.
Inverted trends
“With a third of all UK expatriates in Spain over the age of 65, access to healthcare is crucial,” the investment platform said.
“UK citizens can currently access free healthcare under an EU agreement, however, if the two countries [Spain and the UK] are unable to reach reciprocal agreements this may stop.”
Similarly, Italy and Cyprus reported significant losses with 1,218 and 765 expats, respectively, leaving the two Mediterranean countries.
But Germany and Poland experienced the opposite.
The former saw an increase of 1,408 UK expats, while 929 moved to Poland.
Volatility and uncertainty to blame
Andrew de Candole, chief executive of Easymoney, said: “Continued uncertainty related to Brexit seems to have reversed the flow of British expats to Europe, but it can still be a very attractive move.
“Selling a modest house in a UK city can allow you to trade up to a villa with a pool in many European countries.
“However, sterling has been volatile and healthcare costs in Europe are uncertain.
“That means that those considering retirement need to ensure their investments and savings stretch further in their retirement.
“That might mean accepting that low interest savings accounts aren’t going to help combat the impact of inflation.
“You may have to take some calculated risks with a small portion of your overall savings if you are going increase returns above the rate of inflation and fund a dream retirement,” he added.
Not a big deal?
EU member states could keep losing British expats as the Brexit deadline has passed, and the transition period is set to end on 31 December 2020.
International Adviser reached out to several European financial advisory firms to ask for their views on this trend, but none thought the figures worth commenting on.
Number of UK pensioners claiming their state pension in a EU country. Source: Easymoney
Number of UK pensioners living in the EU. Source: Easymoney
