Spain has long been a popular destination for expats looking for a better quality of life and a warmer climate. The cost of living is lower in Spain than in other countries such as the UK, making it an attractive option for those looking to make the most of their retirement. This, along with the exquisite cuisine, rich culture, and diverse landscapes, makes Spain the perfect place to enjoy early retirement. But you’ll need to assess how to balance your prospective lifestyle with the financial options available.
In this short guide, we’ll explore how to retire early in Spain as we cover topics such as early retirement age, how much you need to retire early and some additional tips to help you understand how to plan to retire early so you can get on and enjoy the wonders that Spain has to offer.
What is the Early Retirement Age?
If you are entitled to a contributory pension in Spain, the official retirement age is currently 66, but this will gradually rise to 67 by 2027. However, early retirement is possible. This all depends on how long you have been contributing to the social security system in Spain. The major drawback to retiring early is that your pension will be cut by a certain percentage for every year you retire below before statutory retirement age.
In recent years, voluntary early retirement has been restricted in Spain; however, as long as you meet the requirements, you can retire two years earlier than the official retirement age and draw your pension early.
Partial retirement is also an option where you can partially retire from the age of 60 while maintaining a part-time working contract.
And finally, flexible retirement allows you to receive part of your pension while working part-time after retirement.
And if you’re planning to retire in Spain from another country, you’ll need to check the government’s restrictions on retiring abroad to ensure you’ll have access to your pension.
How much do I need to retire early?
If you’re ready to spend your golden years in a coastal property basking in the Spanish sun, you may have considered retiring early and how much money you’ll need.
This really depends on your personal circumstances and lifestyle, so you’ll need to take numerous things into consideration. Generally, the cost of living in Spain is lower than in other European countries such as the UK. Housing costs tend to be lower, too, particularly outside major cities, which is important to bear in mind whether you are interested in renting or buying a property.
To retire comfortably in Spain, you should aim to have enough savings or a pension to cover your living expenses and any additional expenses such as travel or leisure.
If you’re looking at retiring based off investments and savings, as a general rule of thumb, you’ll need around 20-25 times your retirement expenses. So, if you spend €25,000 per year, you’ll need at least €500,000 to retire comfortably.
Tips to retire early in Spain
Here we’ve outlined some of our top tips if you’re looking to retire early in Spain. These will help you get an idea as to what you should expect from early retirement in Spain and what you should be focusing on in order to enjoy your retirement to the fullest.
- Learn the language: While many expats get by only speaking English, learning the local language will help you integrate into the local community so you can make the most of your retirement. It will also help with general communication providing you with easier access to healthcare and other services.
- Consider healthcare: If you’re planning on living in Spain for a while, you’ll want access to the free healthcare offered. EU and UK citizens are entitled to low-cost and free healthcare. Becoming a Spanish resident will also enable easy access to these services.
- Seek financial advice: In terms of planning your retirement, you’ll want to solicit professional advice, as the process can be complex with different elements to consider. In order to make the most out of your savings and investments, it’s worth getting the experts involved.
- Immerse yourself: Spain is known for its rich culture and relaxed lifestyle with a focus on family, food and leisure. Spend the time to embrace this lifestyle, and you’ll understand why so many people enjoy an early retirement in Spain.
Our final tip is to find the best location for you. Spain is a diverse country with different regions to choose from, each with their own charm, culture and climate. You’ll need to consider all of these factors, along with cost and access to amenities, when choosing where you would like to retire to.
And if you’re looking to invest in property during this time, have a look at our website at Breezom. You’ll find a range of different properties to suit every need. Furthermore, we will work with you every step of the way to make sure your purchasing process is seamless and stress-free.