# money matters/pensioner



## kovabebek (Nov 5, 2015)

hi all, i am new to all this. currently close to selling and retiring to spain. selling mobile home and buying a mobile home on a mobile home site in spain. 

some questions if anyone can help please.
i am getting confused with all the information ! that dvla etc. give out.

wanted to get info from someone who is already doing this. i will have a state pension and private pension which amounts to only £200 per week. will i pay tax on this ?
how do you get it paid, into uk account and draw from there, or spanish bank account ?

i may also have up to £50,000 that will need putting somewhere safe to keep for extra income. would i keep this in uk bank, would i pay tax on this etc ?

any info regarding the pensions and money matters from someone who has experienced this would be gratefully received !

also if anyone is already living on a mobile home site in spain, can you give me an approx cost of what utility bills come to a week. find it hard to work out by details given by them. 

sorry to ask so much, but a big wrench for me as cannot afford to stay in UK any longer and just need to make sure i have as much info as possible. trying to avoid the unknown problems ! thanks


----------



## 90199 (Mar 21, 2010)

uI have OAP and a UK Gov. pension. Both are paid into a U.K. bank account, then when the exchange rate is in my favour, like today, I use a U.K. currency dealer to transfer a lump sum to my account here in the Canary Isles. That way I do not pay charges here or in the U.K. and the more I transfer the better the exchange rate.

I pay U.K. tax on my Gov. pension, I declare my OAP here in Spain, because I also have returns from investments, I sometimes pay tax here too.

Your lump sum, go and seek professional advice from a financial advisor, that way you may make more money than leaving it in a bank. I have and I have had some very good returns.


----------



## Lynn R (Feb 21, 2014)

Based on the figures you have provided for pension income, and assuming you just put your lump sum into a deposit account paying 2% (and Hepa is right, you may be able to do better) that would give you an annual gross income of €15,960 at today's exchange rate of €1.40. On that income your Spanish tax liability would be approx. €1,900 per year, leaving you with €14,000 pa to live on. 

If the exchange rate were to worsen again, obviously you would have less income to live on although you would also pay proportionately less tax.

I don't know how much it costs to rent a unit on a mobile home site, but a 1 bed apartment in most locations popular with expats could be rented for around €400 per month. With a long term rental the IBI (equivalent of Council Tax) and community fees are normally paid by the landlord so you wouldn't need to budget for those. Electricity for a small apartment, maybe €80 per month if you have an electric oven and hob (mine is less for a 3 bed house but we use gas for cooking and heating), water maybe €15-20 per month. If you want internet (could be needed to get UK tv other than on the Costa Blanca where satellite tv is still available) then budget around €40 per month for that, which might possible include phone costs too). So say €550 per month for rent and bills, which would leave around €600 per month for food and all other personal expenditure (entertainment, transport, clothing, dental treatment, opticians, insurance). 

As a state pensioner you can get an S1 form from the DWP so that you can register for healthcare under the Spanish state system, but prescriptions are not free here for pensioners. You would pay 10% of the cost of any medication but for those with incomes of below €18,000 that is capped at €8 per month (some thiings which are available on prescription in the UK may have to be paid for in Spain, though).

Bus fares are not free for pensioners in Spain either, although certainly in Andalucia you can get a bus pass which gives half price fares and I think other regions have similar schemes.

I advise you to think seriously about how a possible worsening of exchange rates could affect your income as the last time that happened, around 2008, a lot of pensioners living here on fixed incomes were left really struggling.


----------



## Lynn R (Feb 21, 2014)

By the way I also assumed that you are a single person, but if that income is for a couple then your tax liability would be less.


----------



## mrypg9 (Apr 26, 2008)

Lynn R said:


> I advise you to think seriously about how a possible worsening of exchange rates could affect your income as the last time that happened, around 2008, a lot of pensioners living here on fixed incomes were left really struggling.


It's very likely, what with the uncertainty surrounding a possible Brexit, that the exchange rate could drop. This current favourable exchange rate wasn't expected by the BoE.....If the exchange rate were to drop to the 2008 level, parity, the OP would be struggling to live an enjoyable life on that income.
But it's all 'ifs'.
Even a slight drop could have a considerable impact on that level of income, though. Although Baldy will no doubt tell us that he manages on five and sixpence three-farthings equivalent he also tells us that he doesn't eat out much, run a basic vehicle, etc. all of which is fine if that is what floats your boat.
But as well as the non-food expenses there are as you say things like dental care, new clothes and shoes, flights to the UK perhaps, insurances, transport, and, for most people, dinners/lunches or the occasional (or regular) coffee out. Being able to afford what you enjoy and live within your chosen lifestyle is important in retirement. Scrimping and saving and counting euros doesn't enhance the quality of life in Spain.
Incidentally, our internet/phone/mobile costs us around 50 euros a month with movistar fusion. We pay extra for Sky and paid for satellite set-up to get BBC.


----------



## Lynn R (Feb 21, 2014)

mrypg9 said:


> Being able to afford what you enjoy and live within your chosen lifestyle is important in retirement. Scrimping and saving and counting euros doesn't enhance the quality of life in Spain.


Perhaps not the most tactful thing to say to someone who says they can't afford to live in the UK any longer, though. It sound as though they will sadly be already having to scrimp and save and count pennies, as many people in retirement find themselves having to do. If their private pension income means they are above the threshold for being able to claim Pension Credit (receipt of which gives access to other benefits) then it can be very hard, having to pay for everything out of their own income when others with a slightly lower income get a lot of things provided for free.

Perhaps they won't be much better off financially in Spain, if at all, but as long as they have the facts about what things are likely to cost then they must make that judgement for themselves.

One other thing I ought to mention is that from this year onwards UK pensioners living in Spain, France, Portugal, Cyprus, Malta etc will no longer get Winter Fuel Allowance.


----------



## mrypg9 (Apr 26, 2008)

Lynn R said:


> Perhaps not the most tactful thing to say to someone who says they can't afford to live in the UK any longer, though. It sound as though they will sadly be already having to scrimp and save and count pennies, as many people in retirement find themselves having to do. If their private pension income means they are above the threshold for being able to claim Pension Credit (receipt of which gives access to other benefits) then it can be very hard, having to pay for everything out of their own income when others with a slightly lower income get a lot of things provided for free.
> 
> Perhaps they won't be much better off financially in Spain, if at all, but as long as they have the facts about what things are likely to cost then they must make that judgement for themselves.
> 
> One other thing I ought to mention is that from this year onwards UK pensioners living in Spain, France, Portugal, Cyprus, Malta etc will no longer get Winter Fuel Allowance.


A retired person is less likely to have to scrimp and save in the UK. All kinds of help are available. That's not the case in Spain. 
Far from not being tactful, I think what I said was all too true. It's often said that if you find living in the UK hard, you'll find the same or worse in Spain.
A lot of people are under the illusion, for example, that winters in Spain are invariably mild and they will save on heating costs. Not necessarily the case. Hot summers like this past one mean many people will need aircon.
If you don't speak good Spanish, it's not always easy to navigate your way through life. There are indeed interpreters available in many public institutions but not always at times and in places that are convenient.
And as has been pointed out before, there is little or no help in Spain if you fall on hsrd times.
I think it's best not to sugar the pill. Those retired folk you spoke of who were obliged to return to the UK when exchange rates crashed could be said to have been foolish and should not have come here ....surely everyone knows exchange rates fluctuate and prices rise. More forethought could have prevented a lot of trouble.
Moving to Spain on a tight fixed income with very little room for shock absorption may not be a good idea. On the other hand, forewarned is forearmed, as the saying goes. The individual has to make their own decision based on all available information and opinions.
Spain in retirement should mean enjoyment, tranquility, relaxation, not worrying about money.


----------



## mrypg9 (Apr 26, 2008)

Incidentally, retired people as a group are not the worst- off section of British society, although pensioner poverty of course still - shamefully - exists.
Britsh state pensions may be amongst the lowest in Europe but when all the other benefits are factored in, British pensioners aren't that worse off.
As a British person, I'd rather be old and poor in the UK than in Spain.


----------



## Lynn R (Feb 21, 2014)

mrypg9 said:


> Incidentally, retired people as a group are not the worst- off section of British society, although pensioner poverty of course still - shamefully - exists.
> Britsh state pensions may be amongst the lowest in Europe but when all the other benefits are factored in, British pensioners aren't that worse off.
> As a British person, I'd rather be old and poor in the UK than in Spain.


As I said, it is those whose income is quite low but too high to qualify for Pension Credit who find it hardest. People who have savings are not going to be eligible for a lot of the other help which is available.

I have no idea what the OP's outgoings are in the UK, but from what h/she said they are obviously not finding it easy. If we are talking about being able to go out for the occasional meal or out for coffee regularly, then that is going to be more affordable for them here (I could go out to any number of places here and have coffee for €1 and sit in the sunshine in nice surroundings) but that is not a lot of use if you haven't got enough left after paying the bills to do it.

I am not saying yes, they should definitely come - as well as the exchange rate fluctuations, there is also the fact that rents will probably not stay as low as they are at the moment, whilst the OP's income will not increase by much.


----------



## Jumar (Mar 14, 2012)

It's hard to give a figure for the use of water and electricity on a mobile home park because some parks sell on at inflated prices. You really need to ask the park owners for figures for these items.

If you haven't already bought a mobile home think about renting a property instead. The ground rents at some parks can be more than the rent of a property. You don't use up some of your money on the purchase of the home and its easy to move from a rented property if things don't work out for any reason.


----------



## baldilocks (Mar 7, 2010)

Ignoring the sneaky remarks from certain quarters. How easy it is to live on a limited income in Spain depends on the person's nature If she/he is a profligate spender, then Yes, it could well be difficult. For those of us who were brought up in wartime when so much was rationed (not that one could have afforded the stuff anyway) being careful is almost inbred. We never ate out (except on very rare occasions) and invariably found more pleasure in home-cooked meals. Clothes were treated with respect so that they lasted and were passed on when one outgrew them. I am currently wearing one of my late brother-in-law's police shirts (he died in 1995) it is perfectly wearable and since I don't plan on going anywhere other than to somewhere in the village, it is ideal.

We have money to spare/save and can meet most emergencies as and when they arrive. If we need something or wish to update the property, no problem. In the last few years, we have had a new roof and this year we have had the outside of the house repainted and some parts of the interior. We have installed a stairlift since the m-i-l can no longer manage the stairs and we plan on replacing the four remaining wooden window frames with uPVC some time next year. We have also just had a winch installed to hoist the logs from the wood-store to save having to carry them up two flights of stairs, this also meant replacing the railings on the terrace. Yes, we drive a modest car (Berlingo/Partner, 2010 model) which is extremely practical and quite economical but, most importantly, suits our needs (3 adults and two small dogs).


----------



## mrypg9 (Apr 26, 2008)

'Profligate spender' is a biased value judgment not a statement of fact.


----------



## Horlics (Sep 27, 2011)

baldilocks said:


> ....We have also just had a winch installed to hoist the.... logs


Phew, thought you were about the mention the m-i-l again


----------



## baldilocks (Mar 7, 2010)

Horlics said:


> Phew, thought you were about the mention the m-i-l again


I have threatened her with it but she didn't fancy my putting her in a harness that would go round her neck.


----------

