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In 50s ready to relocate: comparing pension options

Posted: Tue Jan 14, 2020 1:45 pm
by GoingMyWay
In 50s ready to relocate: comparing pension options

Over the past year I've seen several people in a similar situation to mine and with the same thoughts.

My situation:
-location Ontario, Canada
-aged 50
-single, no dependents
-elementary school teacher with 20 years experience teaching abroad and 3 years supply teaching in Ontario, with a masters degree
-My present salary in Ontario is with vacation pay is:
$99,700 Canadian
=69,000 Euros
=$76,000 USA
-average tax rate 27%

I thought European salaries were higher compared to Ontario Canada but I'm not so sure now. European taxes are also higher than Canadian. But, I think teachers receive a larger pension in Europe. So if I relocate to Europe while I might have less disposable income for now, when I retire I would be better off pension wise. I'm free to relocate anywhere in the world but value a solid pension from a stable country over big savings that I would need to fret over when investing and organizing a regular stream of income in my retirement years.

NOTE: I just checked with the Ontario Teacher Pension and if I worked to age 65. I would received roughly $2000 CDN a month pension. Things were unclear over the phone and I'm going to get clarity on that and taxes and other benefits retired Canadians are entitled to.

1. Am I mistaken regarding any of this: salaries in Europe, pensions, the comparison, anything else?
2. Any thoughts on a country to relocate to and type of school where to work; state/private?

Re: In 50s ready to relocate: comparing pension options

Posted: Wed Jan 15, 2020 8:56 am
by Helen Back
Surely you'd also get a government/provincial pension as well, which would give you over CAD$3000 a month. If this was me I'd be looking to Asia for a school where you could save and invest a substantial amount of savings. You already have two solid pensions, I'd be looking at saving a substantial sum and investing it offshore. Your situation is not disimilar from mine (although I have a family) and that's what I'm doing. Read Andrew Hallam's book , "Million.aire Expat." It might help you clarify where you can go to get you where you want to be.

Re: In 50s ready to relocate: comparing pension options

Posted: Wed Jan 15, 2020 11:49 am
by GoingMyWay
Thanks Helen.
I should clarify I don't have that Ontario teacher's pension. The amount I stated is what I would receive if I worked in Ontario to age 65. I have only taught a little in Ontario. As of now I have worked so little I would not be entitled to any pension at all I would only receive a lump sum of $16,000 CDN.
I personally prefer teaching in hot inexpensive countries and have taught in such countries in Asia before and loved it. My problem isn't saving it's investing. I don't want to have to worry about stocks going up and down and bonds and GICs and getting ripped off with fees, etc. And how does one release investments for a regular stream of income when retired? It also seems in that situation being 'wiped-out' financially from some financial disaster is more of a possibility. A pension from a solid European country is fool proof and thus for me worry proof.
I've heard of a few books like the one you mention, and The Wealthy Barber and The poor Teacher or something. I've never read any but I think I'll pick one of them up.
Anyone else have some thoughts? I know I've seen others in my position posting similar questions.

Re: In 50s ready to relocate: comparing pension options

Posted: Wed Jan 15, 2020 12:59 pm
by h1275
At $76k you're on more than the vast majority of teachers. My advice is stay where you are.

Re: In 50s ready to relocate: comparing pension options

Posted: Wed Jan 15, 2020 7:14 pm
by IE_sciteacher
I think you need to do a lot of research on the topic of pensions as there are many many factors that apply.

1. You probably will not be able to put in enough years at a school in Europe to contribute to a meaningful pension. Most of the European pensions assume a full/substantial career length for contributing. Also, many countries in Europe are currently unsure of the sustainability of their pensions due to an increase ageing population (Netherlands and France).
2. Where will you have to live to receive the pension? Does it include good medical everywhere? Yes Ontario has medical coverage however it’s not a comprehensive coverage.
3. How many years will it take you to get a reasonable job in Europe? It can take time to land a good enough job in Europe (it can also be quick).
4. The number of years left until retirement makes the investing strategy harder. However, I would recommend reading Hallam’s book like a previous poster mentioned. Many of your concerns about the stock market could be answered.

Advice. Go to a south east Asia country where you can make a lot of money with little expenses trying to build as much of a nest egg as possible. I do not think that the pension plan is a viable plan.

This is all based on my research of trying to figure out the finances of moving to Europe as well for work. Others living in Europe may have more specific information.

Re: In 50s ready to relocate: comparing pension options

Posted: Sun Jan 19, 2020 12:25 am
by ILMathTeachr
When you're exploring pension systems, you need to be finding out exactly how much service time you need to put in before you "vest." In Illinois, for instance, you must work 10 years before you vest. Your pension is then 2.2% times the number of years of service credit times the average salary over your final ten years, assuming you've reached the age of 67. If you retire before then, you get 6% less per year you are retiring earlier (going out at 62 results in a 30% haircut off your pension, for instance).
Theses are the kinds of rules you must be aware of if you have designs on putting in enough time somewhere to draw a pension. The advice in the previous posts is correct; you need to find a job where you can stash enough money to invest it yourself. Consider using a brokerage where you can buy exchange-traded funds, which will have fees that are small fractions of a percent.

Re: In 50s ready to relocate: comparing pension options

Posted: Sun Jan 19, 2020 10:15 am
by GoingMyWay
I'm torn as to what to do. My salary in Ontario is basically. $100,000 per year. But we are in strike mode now and teaching is a tough gig. I could get an immediate permanent position if I taught French which I am certified to do but reluctant. And because they are so short of French teachers here once you start in French you are permanently restricted to teaching in French. There are many factors in my decision: family in Ontario, I should also receive a bit of an inheritance, where I actually like teaching, etc. I'm finding out that Canadian teacher salaries are actually quite good and that Europe may not in fact be better except in terms of a pension. I may talk with a broker friend of mine. I'm also going to read some of the books suggested. Another factor is moving into administration. That raises the salary too but school admin don't seem to be a happy lot.

Re: In 50s ready to relocate: comparing pension options

Posted: Sun Jan 19, 2020 8:25 pm
by marieh
If you go into admin just for the money, you're going to have a bad time. Buy Andrew Hallam's book this week and start thinking about how you can invest your income. I think you're suffering from a "grass is greener" mentality when in fact it might be easiest for you to stay where you are (and perhaps consider teaching French).

Moreover, I think you should run the numbers on European pensions as an IT. It's not as easy as you might think, especially since you will need to account for paying local taxes after year 2 or 3. I'm 35 and on the upper end of what is realistic for that route.

Re: In 50s ready to relocate: comparing pension options

Posted: Mon Jan 20, 2020 1:37 am
by ILMathTeachr
Also, a quick Google search showed me that most EU nations require you to work for 15 years before you qualify to draw a pension, though it is cumulative, so, for instance, 10 years in France, plus 5 years in Spain would qualify you for the minimum pension, calculated by each country.


Posted: Mon Jan 20, 2020 8:18 am
by PsyGuy
Short Answer: Youre better off where you are.

Long Answer:
I strongly disagree with the saving and investing contributors. There premise and approach is you should plan retirement doing it all yourself. You should absolutely take advantage of pension and retirement programs as your primary focus as opposed to just "saving away" or worse the fallacy of investing.
In the EU you will essentially make about €100/month in retirement coin for each year you contribute to the system. These systems vary but are generally composed of three elements 1) A general national program. 2)An occupational (edu) program and than an organizational (employer) program. Vesting times differ with as little as 5 years. There is also the issue of minimum retirement coin which is for citizens (obtaining citizenship in the EU country) that supplement retirement with various social welfare programs, but this is why wherever you go you need to be set at around 50 because you will need 15 years to build up a suitable pension.

Outside of Switzerland and a few elite DSs your not going to do better than where you are.

Re: In 50s ready to relocate: comparing pension options

Posted: Tue Feb 11, 2020 2:49 pm
by jschott
Pension vesting in Germany is 5 years. Very small pension at that level.