More than two thirds of expats working in the UAE are planning to return to their country of origin according to new research from Old Mutual International and Quilter Cheviot.
The research found that an average 64% of expats working in the UAE plan to return back to their home country when they retire, this, Quilter Cheviot point, highlights the need for expats to choose savings and investment solutions which are suitable and portable back to their home country.
According to the data supplied, the highest percentage of expats looking to return home by region was North America, with 75% planning to return back to America when they retire.
62% of European (excluding UK) expats said that they plan to return to Europe when they retire, with just over half (52%) of UK expats planning to return to the UK when they retire.
Less than 1 in 10 stay
As there are strict rules in place for expats regarding being able to retire in the region once they have worked there, it is perhaps not surprising that just nine per cent of expats plan to remain in the UAE when they retire. It also highlights that note all expats leave the UAE, once they hit retirement.
Of those that did not express a a desire to return to their home country or stay in the UAE, 16% of expats plan to retire somewhere else with 11% not sure yet where they will retire.
Quilter Cheviot point that the survey demonstrates “the changing face of retirement”, as more and more people work into their 60’s and then either stop, with three out of four (76%) of people living in the UAE stating that they plan to continue working in retirement work part-time.
41% said that they will continue working for “social reasons”, with others planning to continue working part-time to make ends meet. Just eight per cent are planning to stop working altogether when they retire and 16% are as yet undecided.
‘Longer term transition’
Mark Leale, head of Quilter Cheviot’s Dubai office, said: “Retirement no longer happens on one day, it is a longer term transition and therefore the financial plan that people make for retirement also needs to adapt. Making sure you have a financial plan that extends beyond the time you give up full time work is more important than ever.”
Paul Evans, head of region, Middle East & Africa, Old Mutual International said: “There is much less certainty on what retirement looks like now and no two experiences will be the same.”
The research also shows how the gratuity scheme in the UAE can contribute towards providing a fund for retirement.
77% of people in the UAE expect to receive an end of service gratuity. A small proportion, 13%, are not sure if they will receive a gratuity, perhaps due to some uncertainty around the terms of the scheme.
“Retirement income is one of the most important areas in financial planning as it can have far reaching implications on someone’s quality of life when they stop working,” added Evans. “A gratuity should be considered when looking at someone’s long-term savings plan, but as our research shows, it is not being relied on in isolation.
“Many factors contribute towards building a long-term financial plan, and I would urge people to seek financial advice from a professional to ensure they have adequate savings in place to fund their aspirations in later life.
* Old Mutual International and Quilter Cheviot conducted its investment and retirement research in August. A targeted piece of research, aimed specifically at investors living in the UAE (mainly Dubai and Abu Dhabi) who use the services of a professional to invest in the stock market.
Investors needed to have a minimum of $50,000 invested. 130 responses were received in total and were a representative cross section of those living in the UAE (expats, NRIs and GCC Nationals).