When you left the UK did you think you would also be leaving the country’s politics behind? If so that has turned out not to be the case because it is likely that ex-pats will be affected financially in some way when Britain leaves the EU.
No matter how far you travelled it would be difficult to stop hearing about Brexit – but there’s good reason to pay attention to what is going on. Although we don’t yet know what form it will take or even if there could be a second Brexit referendum once the deal is finalised, there are some predictions we can make fairly safely, and there are some areas you should be paying particular attention to regarding your assets.
What we know
Whether or not a deal has been agreed between those involved, the UK will formally leave the EU on the 29th of March 2019. Economic uncertainty about what will then happen is likely to lead to a fall in the value of the pound. How severe that is and how long it lasts will depend on how much has been agreed between the UK and EU, how many economic arrangements will remain constant, and how many alternative trading arrangements the UK has been able to establish with non-EU countries.
Stocks and shares
After an initial shock, the UK economy reacted to the vote to leave the EU less dramatically than many had feared, but since then there have been worrying signs as some large companies have chosen to withdraw their business from the country altogether. If you have money invested in UK business, it’s time to check how your sector is doing. The service industry seems to be bearing up but construction may be in trouble because it’s heavily dependent on EU imports, and finance sector experts say they simply can’t predict what will happen in their part of the economy.
If you have property in the UK, you will no longer be able to rely on its value going up unless you are able to hold onto it for at least a decade. It might still be worth retaining a UK base if possible as insurance against having to leave your current home if residency arrangements cannot be agreed. That is unlikely to happen because all EU members will want to protect their citizens resident in other parts of Europe, including the UK.
In the immediate term, established pension arrangements that don’t depend on EU law mean you will continue to have any UK pension you receive as usual. In the longer term, however, the UK government may cease to pay increases related to inflation, as it will no longer be legally obliged to do so.
Protecting your investments
Now is a good time to assess any investments you have in the UK and prepare yourself for the coming changes. If you have a significant amount invested, it would be wise to seek professional help. Shard Capital Partners LLP are experts in asset management who work with private individuals as well as companies. They’re used to working in an international context and can also provide useful advice if you choose to move your capital.
In the long-term, it’s difficult to predict exactly what the consequences of Brexit will be, but if you’re depending on UK-based assets for your day to day income, the smart move is to opt for additional security in preparation for what is likely to be a volatile period.