Post Brexit phase 1 - a move to the Med is go!

Paphos Forest, Cyprus

In the immediate aftermath of the Brexit referendum result my immediate thoughts were has the door to our dream been slammed shut.  An initial review suggested that it was still ok, albeit with some potential speed humps, but even though the data said we were still golden some trepidation was still there.  In particular I had three main concerns.

The first concern was being able to register and live legally in our new chosen country.  Both the EU and the UK government were always verbally saying current residents would be ok but they never spoke about new entrants since the referendum or since the trigger of Article 50.  Even as recently as September 2017 the UK would only commit to the negotiations being applicable from a date between the date of Article 50 trigger and date of exit.  The joint report published on Friday finally clears that up with the paragraph:

“The overall objective of the Withdrawal Agreement with respect to citizens' rights is to provide reciprocal protection for Union and UK citizens, to enable the effective exercise of rights derived from Union law and based on past life choices, where those citizens have exercised free movement rights by the specified date.”

A subsequent paragraph then defines the specified date as:

“The specified date should be the time of the UK's withdrawal.”

So provided we’re residing in an EU27 Member State by 29 March 2019 we’re within scope of the agreement.  Tick.

The second concern was around healthcare.  We know we’ll need to be private in the early days but our concern was that if we really loved it and wanted to stay into our dotage could we find ourselves with problems if private became non-viable (it became prohibitively expensive or the company decided to stop insuring us at a point where reinsurance elsewhere was not possible).  We did have some options here, particularly if the new Cyprus NHS comes to fruition, but it was not as attractive as previous.  The joint report clears that up:

“Rules for healthcare, including the European Health Insurance Card (EHIC) scheme, will follow Regulation (EC) No 883/2004. Persons whose competent state is the UK and are in the EU27 on the specified date (and vice versa) – whether on a temporary stay or resident – continue to be eligible for healthcare reimbursement, including under the EHIC scheme, as long as that stay, residence or treatment continues;”

It looks like we’ll have the same access to healthcare as we currently do meaning as we pass State Pension age the S1 route to healthcare should still be possible.  Tick.

The third concern (concern is probably too strong a word) was State Pension rights.  In all my planning I assume no State Pension but at the same time I intend to build 35 years of contributions via voluntary contributions post FIRE as an insurance policy against it going all wrong.  My primary concern was that the UK might stop the pension keeping pace with inflation (currently part of the triple lock) as they do for many countries outside the EU and Switzerland.  The joint report covers it:

“Social security coordination rules set out in Regulations (EC) No 883/2004 and (EC) No 987/2009 will apply. Social security coordination rules will cover Union citizens who on the specified date are or have been subject to UK legislation and UK nationals who are or have been subject to the legislation of an EU27 Member State, and EU27 and UK nationals within the scope of the Withdrawal Agreement by virtue of 3 This includes beneficiaries of the Withdrawal Agreement who hold valid domestic immigration documents conferring a permanent right to reside in the host state (such as UK Indefinite Leave to Remain (ILR) status). Page 5 of 15 residence. Those rules will also apply, for the purposes of aggregation of periods of social security insurance, to Union and UK citizens having worked or resided in the UK or in an EU27 Member State in the past;” 

with the supporting comparison notes making it even clearer:

“Lifetime export under conditions in Regulation (EC) No 883/2004, including lifetime export of uprated pensions.”

It looks like the insurance policy is still in play.  Tick.

Another indirectly related consideration is that the Brexit vote has seen the Pound weaken and I’d suspect if a decent trade deal is not forthcoming it will weaken further.  Today the exchange rate is still above my worst case planning of 1.123 but even if it weakens further in the coming years we should still be golden.  Financial Independence (FI) being achieved way back in July 2016 and a subsequent acknowledgement I would do one more year (OMY) is seeing to that:

Click to enlarge, Wealth growth in Euro’s since FI (July 2016) and OMY (July 2017)

Of course the joint report leaves everything subject to change:

“Under the caveat that nothing is agreed until everything is agreed...”

But even I’m not so risk averse that I need to wait for the final deal just to be sure.  So the Med is go!

As always DYOR.