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Planning for a painless retirement
Where does that leave your pension, and how can you make sure of building up your state, company and private pensions while in Belgium?
The answers are far from simple to understand and plan for, even for an employee who remains in one country for the same company over an entire career. For an expat, they’re even more complex, and the more countries you live and work in or the more employers you work for, the harder it gets. By the time you reach pensionable age, your first employer may no longer be around or may have changed name and form several times.
As far as the state pension is concerned, things are reasonably well organised within the European Union, as well as for any country with which your homeland has a social security treaty. For countries other than those, your homeland may have a special state pension scheme – in Belgium, for example, there’s the DIBISS, formerly known as DOSZ-OSSOM.
Unfortunately it’s a major administrative task to keep up to date on the data from the various countries you’ve worked in. Then, when you become eligible for your pension, there may be some delay before your pension pay-out comes together from the different administrations involved.
Turning to company pensions, fewer companies have this under control than you might think. Some may make a “pension promise” (not advisable from a company point of view), while others have an international pension scheme, often offshore, which is not easy to run and which makes it difficult for you to compare what you will receive with what your peers back home will receive. If you change employers, or if you move often between countries, things can get even more complicated.
The issue is always the same: keeping track of the parts of the pension you have built up with different employers in different countries. Other problems include compliance with local and international regulations, taxation of payments into the pension scheme, income from the scheme and, last but not least, the eventual pay-out from the company pension fund.
A private pension presents the fewest problems, as long as there are no fiscal advantages associated, in which case it amounts to no more than regular savings and investments for a future purpose, namely income after retirement. Many countries offer fiscally advantageous private pension schemes, partly because they may be short of funds, or because they have lowered the levels of state pensions or raised the age at which a person becomes eligible for a pension.
These pension schemes are popular with expats, but the conditions attached can sometimes lead to problems when the expat moves to another country. All in all, good administration is the key to a retirement that’s as painless as possible. Start preparing for your pension today, or at as early an age as possible.
"Planning for a painless retirement? As an expat, you probably travel the world, living in one or more countries along the way.
The Bulletin & ING are delighted to give you the information you need! Watch the video of The Bulletin and ING pension seminar or download the presentations given by our pension experts."
Register for the free expat information seminars on www.ing.be/seminars