Tax Advice in Spain - Are You Earning Over 8% Per Annum on Your Savings in a Tax Efficient Way?
When people retire to Spain, one of the highest priorities for them is how they're going to fund their lifestyle. Most people have pensions that they rely on to support them but also most couples have savings and investments that they have to draw on to supplement their income in Spain. The problem with most investments are that they're Stock Market related and as such are volatile.
Yes, during the good years a client can make anywhere from 10% to 30% per annum quite comfortably, on the other side, in the bad years, they can also lose this same amount too. The recent subprime market has brought this to a head where the markets have lost 20% of their capital in the last year. Many of the clients that I meet in our office in Torrevieja say that they don't want to take the votatile risk of the stock market with their money. The general view is that they've an amount of money that they've saved up, they're retired ( i.e they'll not earn this money again ) and so they don't want to lose it !! This is perfectly understandable and we also agree with this too.
In this hectic and volatile investment market place we would recommend that within an investment portfolio, a large amount of the capital should be capital safe ( such as an offshore bond with Alliance and Leicester or Nationwide Building Society) and then a client may want to invest a SMALL amount of their capital in a very low risk environment such as a student accommodation fund which although the interest isn't guaranteed, it has made over 10% per annum for the last ten years ( even throughout the subprime crash, september 11th, Iraq War etc )
