Pensions’ trap warning for contracted expat workers

Individuals working internationally are falling into a trap causing a shortfall in their pensions contributions, warns international financial planning group Guardian Wealth Management (GWM).

“All too often when people take a short-term contract and move abroad they put their UK pensions on hold. Since they are on a contract they are unlikely to be eligible to enroll in any local company pension scheme,” explains Gavin Pluck, European Director.
 
GWM points out that even when expatriate workers are eligible to enroll, many are put off because they don’t want the hassle of transferring the pension out at a later date.
 
“What then happens is that contracts are extended but the pensions are forgotten and people find 10 years down the line they have failed to make adequate provision for their retirement,” says Pluck.
 
This omission is then further compounded because any early contribution made into a scheme benefits from year on year accumulated growth, which favourably impacts the final pension pot available to that person at retirement.

GWM sees  contracted international workers being the worst prepared for retirement, even where they have left their home country because it is financially beneficial to work abroad, and this is down to the tendency to adopt a short-term outlook neglecting any planning for long-term needs. 

http://guardianwealthmanagement.com