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How to retire overseas (with the Age Pension)

Retirement  |  18/04/2018  |   10 min read

How to retire overseas (with the Age Pension)

Whether you’re looking for a tropical paradise, want to make the most of your savings, or a more comfortable lifestyle, retiring overseas is an increasingly popular option for Australians.

Estimates place 84,000 Australians retirees on foreign soil, and the number is rising every year. New Zealand is the preferred destination, with Italy, Greece and Spain close behind.

But how easy is it to retire overseas? And what does it mean for your age pension benefits?

The Age Pension

The good news is you may be able to access your age pension while living overseas. This will be paid at the ‘Outside Australia’ rate which means you're entitlements will be impacted. For a couple this may be up to about $34,000 per annum and is subject to the usual rules around income and assets.

You can read more about the rules and payment rates on the ATO’s website.  

Getting your paperwork in order

Unless the country you’re moving to has an agreement with Australia, you’ll need to put in your claim for the Age Pension locally, and in many cases will need to prove residency here for two years before you qualify. If you’re already overseas, that means you’ll need to return home first.

You’ll also need to investigate residency requirements in your overseas home. These obviously vary from country to country, and some places are easier than others. You can read more about which countries Australia have an agreement with Australia (and how this may impact your Age Pension payments) here

Health care

Having access to affordable and reliable health care services is a major consideration when retiring overseas. International health Insurance is one option, but it can be very expensive.

Medicare is another option, and as long as you’re an Australian resident (for tax purposes) you can continue to use Medicare services in countries that have a reciprocal health care agreement. These agreements usually only cover essential medical treatment, and vary from country to country – you can read more here.

According to Australian Expat Investor, “You will usually require your Australian passport and a valid Medicare card [to receive treatment]. Depending on the country, you may need to pay for the health services upfront (and claim reimbursement after the event), or you may need to make a co-contribution to the cost of the treatment.”

Your home

Retiring overseas is a major lifestyle change and shouldn’t be taken lightly, but there are other options that allow you to get a feel for oversees living without having to give up the comforts of home. Australian retirees who have lived in Australia for over 35 years can spend up to 6 months of the year abroad while continuing to receive their full pension payments.

In response, some Australians spend half the year overseas, and sub-let their home while they’re away. This helps them subsidise the cost of their overseas travel, while still maintaining their permanent home in Australia. There may be tax and Age Pension implications for these arrangements, so it’s worth talking to a financial planner or accountant before going ahead.

According to a report by HSBC, 31% of Australian retirees own a property in their host country. While that may allow you to fast track residency in certain countries, whether you choose to rent or purchase a property overseas will depend on your circumstances.

Where shall we live?

So that takes care of the paperwork and the finances, only thing left is to decide where you’d like to retire.

To help get you started International Living have compiled their annual ‘Best Places to Retire’ list, which you can cross reference with the Expatistan cost of living calculator. The calculator allows you to compare everything from housing to medical costs between different cities, and while it’s not 100% accurate, it will help you compare costs between your current destination and that overseas city you’ve always dreamed of visiting.  

Learn more about your retirement options by speaking with an Equip financial planner. Learn more here.


Togethr Trustees Pty Ltd ABN64 006 964 049, AFSL246383 ("Togethr") is the trustee of the Equipsuper Superannuation Fund ABN 33 813 823 017 ("Equip" or "The Fund"). This is general information only and does not take into account your personal objectives, financial situation or needs and therefore should not be taken as personal advice. You should consider whether this information is appropriate to your personal circumstances before acting on it and, if necessary, you should also seek professional financial advice. Before making a decision to invest in the Equipsuper Superannuation Fund, you should read the appropriate Equip Product Disclosure Statement (PDS). Past performance is not a reliable indicator of future performance. Togethr is licensed to provide intrafund personal and general superannuation advice under its AFSL. Member Advisors are employees of Togethr. For more information about the remuneration of Togethr and its employees, please refer to the Togethr Financial Services Guide (FSG).

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