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"Buy land - they've stopped making it!" 😎

@Cheryl

"Saving for retirement" is hard to do in Bulgaria because it's the EU's poorest country with some of its lowest salaries. I would find it extremely challenging simply to live on a typical local salary, let alone have any left over to save.

While I love my life in Bulgaria, I can't see it as a recommendable option for younger folks, regardless of whether they're  expats or nationals. It might be seen as a harsh judgement, but early career professionals should simply choose to go elsewhere, and find other countries where they can work, earn, and save.

Depopulation (both overall, and relative to the key urban areas) has been a significant issue in Bulgaria for many years. It's clear this has been, and continues to be, driven by its youngsters. They're moving abroad (with an EU passport it's a fairly trivial exercise to work in Germany instead of Bulgaria), or, at the very least, moving to Bulgaria's biggest cities (Sofia, Plovdiv, Varna, Burgas).  The following article gives more detail:

To use the UK as a comparison, it has a population of 70 million, and less than 6 million Brits live abroad (8%). Bulgaria's population is 6.5 million, but perhaps 2 million live abroad (30% ish).

For us, Bulgaria has been a great choice, and we have a lifestyle that's far beyond what we could afford elsewhere. Moreover, Bulgaria has many great qualities aside from being cheap. But the truth is that I'm old and no longer "economically active" (i.e. contributing to the economy by working), and I already earned my money in very prosperous countries (UK, USA, Finland).

Old Fogeys, such as me, are pretty much irrelevant. Most will stay in their own country (regardless of any perceived decline), and the majority who retire abroad will have a different cost-benefit analysis and choose more traditional retirement destinations (France, Spain, Portugal, Cyprus) even if more expensive. For example, Britain has 12 million pensioners, and only 1 million (8% ish) live abroad! Maybe 250k (less than 25%) in the EU. Specifically, 100k pensioners now live in Spain, and a mere 1,000 or so in Bulgaria, making it a very minority preference.

Bulgaria's own Old Fogeys (who worked many years in Germany and UK) might be more tempted to return (especially if they invested in Bulgarian property while abroad) but, even so, the majority tend to stay in their adopted country.

On the other hand, if you're referring to savings and pensions accumulated elsewhere, I can't even see this as any kind of problem. These days "accessing pension funds" is a no-brainer, as any pension administrator just wants an updated address and bank account and will continue to pay your pension wherever you want. Similarly, with online banking/brokerage accounts you often don't even have to move your savings. My savings certainly remain outside Bulgaria, and its immaterial where I live. My pension isn't even paid to a Bulgarian account.

Arguably, one of the biggest potential benefits of Bulgaria's closer EU integration (Schengen Zone, Euro introduction) might be that it gets MUCH MORE EXPENSIVE. This is bad for me, of course, but could be good for the country. If the cost/salary gap between Bulgaria and its prosperous EU neighbours narrows, it may be able to reverse years of depopulation if its youngsters start finding that it's actually of marginal benefit to move abroad and work in Germany instead. And Bulgaria recognizes the problem, and is already encouraging its youngsters to stay, and its expats to return.

In the last few years there have been more Bulgarians returning to Bulgaria than leaving; the research indicates that a substantial proportion of those are (comparatively) young people who feel they have achieved their goals abroad and are confident in their ability to succeed once they've returned. The 2021 census recorded that over 314,000 Bulgarians who had resided abroad for over one year had returned permanently between 1980 and 2021, so the picture is certainly not all bad. One also has to bear in mind that a substantial proportion of those leaving weren't/aren't educated/skilled workers and were very likely in the black economy, so their absence is probably more valuable than their presence, in terms of investment in the state.

There's also plenty of evidence that Bulgarian expats have been investing in the domestic real estate market; that has been a significant factor, among others, in the rise in house prices here, which is significantly higher than the EU average.

The house across the lane from our had been squatted in by a Roma couple but last year they left and the house was knocked down and a new build started. It was started by a Bulgarian family who currently live and work in Germany. Work stopped for a while and I assume that they're having the  build done bit by bit. So on our lane we already have a Bulgarian family who currently live and work in Belgium but the house itself is very big and has a wall all around it.  Then a Bulgarian family then a house that was for sale but has a number of visitors from Germany as well. So although some houses are squatted in by Roma families in the end they're moved out and the house is either knocked down or done up.

The perception in our village is that it's now slowly growing again, after huge depopulation. Not expats, though there are a few, but Bulgarians returning home from overseas work or from time in the city, who want to go back to village life.

I've met plenty of older Bulgarians who've worked elsewhere for the better salaries and opportunities who are now retiring to Bulgaria, including professional people. But it's not all retirees. Several of the parents of kids at the village school formerly worked in the UK or Germany, or in Bulgarian cities, but returned to the village because they'd earned what they needed, they wanted to own a house not rent, and they perceived their children would have a better quality of life and a better education back in Bulgaria.

It's seems to be a similar situation in our village on our street and few houses have been improved by village families currently living and working in Belgium and Germany.

But our village is very very large

...they perceived their children would have a better quality of life and a better education back in Bulgaria. - @janemulberry

I suspect that the first part of that "perception" is probably true - but my wife would be the first to say that they're barking up the wrong tree on the second one.  By and large, she gets the cream of the crop of school-leavers who want to go on to university, and she decidedly shares Boyko Borisov's views when it comes to the quality of the "human material" (and what they're taught even in the specialist schools here) she gets as students in comparison to years gone by.  Part of that may be down to the richer ones going abroad to study (although many of them do so because they can't make the grade here, and there are always unis abroad looking for foreign students willing to pay their hefty fees) but free tertiary education in their own language is a definite attraction to the smarter school-leavers here.

It's possible I (and those parents) are wrong in that perception for sure.

Though I am not convinced that the current UK state system produces better educated people with motivation to learn, except in certain pockets of excellence. Zlati needs a group of the kids who just did their UK A levels and are going on to uni for a comparison. One of the mothers I spoke to at a school event had her kids in the UK state school system, and feels they're getting a much better education here.

I've been impressed with what I've seen of the village elementary school, and my neighbours' grandkids seem to be doing very well at the high school in Dobrich. Though TBH, the fifteen year old strikes me as the kind of bright, motivated kid who would learn no matter where he was, given books and internet access.

@Cheryl

Plain truth is, I didn't have retirement savings in Bulgaria. All my savings are in the UK, invested via a UK investment company, who invest, diversely, worldwide.

My situation was rather different from most. I didn't have one single pension scheme for myself, like most people have. Nor did I have multiple schemes. Instead, my family invested into one pension scheme; in other words three people were paying into one pot. The advantage of this is, that it grew much quicker and a very large pot was realised over 30 years. However, the only way of achieving this, was through an SSAS scheme, with three companies paying into the pot (my company, my brother's and my late father's). The negative side of using an SSAS, is that you will have to pay accountancy fees to audit company accounts. Also, the management fees from the pension administrator, were quite high, so this totalled to around £12,000 p.a. in recent years.  Similar rules applied to our SSAS as they did to SIPPS, so I could retire as early as 55 years old.

I did retire early, at 58 years, which I hadn't wanted to do, but a work accident forced me into the situation, as my recovery was not 100%. I had smashed my hip in four places and after two operations and 14 months recovery, I am 80% of what I was. Needless to say, I sued the company for damages, via a no win, no fee solicitor and won.

I retired myself officially in 2020, although I crystallised a small amount of my share of the pension pot in 2019, which, again, I was forced to do, because of the accident. Whilst I claimed Universal Credit for three months (the first time ever in 58 years) claiming Universal Credit was an absolute nightmare and I gave up dealing with the DWP in disgust and deemed them corrupt. I told them to close my account. I did however manage to claim PIP for a while (6 months) but it took over 5 months after initially applying, before they started to pay and the amount was paltry.

So the crystallisation in 2019, saw me through a difficult time.

Then Covid came and in February 2020, my employer tried (in vain) to get me to come back to work. At that point I resigned.

I thought long and hard of what I wanted to do next, realising Covid was not what we were being told and that the UK was destined for very difficult times. Again I drew down on my crystallised amount, enough so that I could move to Bulgaria and live for around 18 months.

I moved to Bulgaria in August 2020.

At that time, I had considered using the QROPS scheme and transferring my entire pension to Bulgaria, but after careful research, I firmly decided against it, as not only is QROPS transfer expensive, but I felt Bulgarian Investment companies were not only few and far between, but not that great at investing - at least, certainly not as good as a company such as A J Bell in the UK.

So, in 2021 four things happened, that made my life significantly more comfortable.

Firstly, I started to take a monthly payment from my pension from March onwards. Secondly, my father passed away in March 2021 and by August following, the remaining share of my late father's pension was inherited and was available to draw down on, as a monthly pension payment. This meant I had two pots I could draw on. Thirdly, I finally (after three years) received compensation from my work accident, paid out in October 2021 and fourthly, in December that year I inherited a share of my father's estate.

In 2022, I used the compensation and inheritance to purchase property here in Bulgaria. We still have all the property. The compensation bought us a studio apartment in Varna. The inheritance bought us out own apartment and two garages and a parking space. There was some money leftover for repairs and renovation.

Fast forward to September 2023 and my brother and I discussed transfering the entirety of our pension investments from the existing SSAS as well as, both the adminstration company and the investment company, to another administration company and another investment company, but, instead of continuing as a SSAS, we transferred to a SIPP. This was to knock the SSAS on the head, so that we no longer had to pay accountancy fees, saving a significant sum of money and also to improve our investment opportunities, as the previous administration company had a poor customer service rating and was extremely difficult to deal with - even our new administrator was fretting about the old one, when it came to the actual transfer.

I'm pleased to say now, my new adminstration company is super efficient, answering emails, usually within a couple of hours and handling adminstrative tasks. The investment company is impressive, especially considering the precarious state the Western World is in and, so far, I'm very pleased with my returns.

We  finally started with the new administrator and investment company in May 2024, after the old ones dragged their feet on the transfer.

My pension has to be paid into a UK bank account and PAYE is deducted by the administrator. I then transfer it to my Wise account, which literally takes seconds and then convert it to Leva, again, instantly. I can then, should I need to, transfer to either of my two Bulgarian bank accounts.

Whilst it would be nice to be able to say I would invest into a Bulgarian investment company, I cannot, until such time, the investment industry improves here.

The only investment I would consider buying here is gold.

I should add, the UK is going through an extremely worrying time, with, what is in effect, a Communist government with extreme Socialist economics, which will, undoubtedly, cause a financial collapse within the next three months. The question is what can I do and the answer is, it's Catch 22, because cashing in my entire pension would mean paying 40% to the tax man - not an option! I could use QROPS, but an economic crash in the UK and France as well, will send the World's markets into freefall.

Any sensible ideas are welcome - anyone?

@cyberescue1

Given the expanding property market here, I'd certainly suggest Buy to Let.  Rents are high and the underlying increase in value make it well worthwhile as a medium- to long-term investment.  My suspicion is that the market will explode next year, due to a lot of people biding their time as they're uncertain about the effects of joining the Eurozone.

@Cheryl

I have a UK private pension, invested by a top investment company and administered by one of the best pension administrators.

My monthly paid pension is UK taxed at source and PAYE is automatically paid to the HMRC. My pension is paid into a UK bank account. I then transfer most of it, each month, to my Wise account (no fee to transfer) which literally takes seconds - gone are the days of long transfer times, at least for the time being.

I then convert the GBP in Wise to BGN in Wise at a very low fee.

With the pension administrator I'm using, it's also easy to draw down any lump some, should I need to.

The UK and Bulgaria have a single tax agreement, so I'm only taxed once on my pension income.

I've been with the current investment company and administrator, since April last year; before that, I was with another investor and admistrator, but moved due to reliability issues and below average return on my investments.

I should add, I don't solely rely on my pension investments, albeit so far, they've been excellent;  I also have investment in property, gold and art, all of which have increased in value significantly.

With the UK as it currently is (not pretty) I'm glad I do not have to rely on a state pension, which I could well imagine could , at some stage, be in danger of not being paid.

That said, if I ever get the chance to claim it, I certainly shall.

The UK and Bulgaria have a single tax agreement, so I'm only taxed once on my pension income.
- @cyberescue1

A "single tax agreement" is not a standard term in international tax law.

You mean........

A double tax treaty (DTT), also known as a double tax agreement, is a bilateral agreement between two countries that coordinates their tax laws to prevent the same income from being taxed twice. They are essential for individuals and businesses operating internationally, promoting cross-border trade and investment.