The 7 financial steps to take for a fresh start to life in Spain for 2021

Financial Checklist

I always like to write an article at the end of each year to give people some financial tips to help them prepare for a financially sound year. This year’s article is certainly different to previous years, as we reflect on what has been one of the most challenging periods most of us will live through. I’m an optimist and I firmly believe that 2021 will be the year that the world recovers and comes together to celebrate the simple things in life that we once took for granted.

Whilst financial planning might not be at the top of your priorities right now, it’s always good to give some consideration to your finances, especially as this January is one that will make history!  

Consider tax strategies

Maybe you’re planning to become tax resident in Spain in 2021? If you are then it is essential that your current financial position is reviewed to ensure all of your savings/investments & pensions continue to be tax efficient and compliant as a Spanish resident. One important thing to consider is what allowances you have as a UK resident and how they will change when you become a Spanish resident. For example, ISA’s and Premium Bonds do not benefit from tax-free status once you are Spanish resident. Onshore UK investment bonds like Aviva, Prudential and others, are taxed at the basic rate at source in the UK and can lead to you paying tax twice as a resident in Spain. This type of tax is not reclaimable under the Double Tax Agreement, so anyone in such a plan should seek financial advice from a Spain based adviser as soon as possible.

Review your investment mix

Are your investments still in line with your goals and risk tolerances? Changes in the values of your stocks, bonds and other holdings over the past year may have moved the relative weights away from what best meets your needs. For example, the stock market has had a surprisingly good year, so the percentage of your investments in stocks may have drifted upwards, beyond what may be appropriate. Perhaps the New Year would be the perfect time to have your portfolio reviewed by a Chorus Financial adviser?

Ensure your products and the advice you receive can continue after Brexit

I think this is going to be quite a big concern for many. As you will have read in my previous articles, banks are withdrawing certain services and UK based financial advisers will potentially be restricted in offering advice to non-UK residents post Brexit. My advice here is to contact your providers and discuss your concerns, along with seeking local advice here in Spain to see what services are on offer. At Chorus we are taking on many plans previously managed by UK advisers, and the transition is simple and stress fee for those clients. This ensures continuity of professional advice in 2021.

Review all insurance coverage

Take a look at your coverage for your car, home, life insurance, etc. to be sure you have enough — and not too much — and that you’re not overpaying. Look at whether you could drop some unnecessary add-ons to save on premiums. Comparison-shop among insurance companies to see whether switching makes sense.

Review your Will

Especially if you’ve had a recent family event such as a marriage, birth, new grandchildren or a divorce, the approach of the new year is a good opportunity to make sure the beneficiaries you’ve designated in your will match your current wishes. If you’ve never made a Spanish will but have assets in Spain, you should also be aware that the Spanish law is very different to the UK. If your Will doesn’t specify that you wish for it to be written under British law, then Spanish law will automatically apply. Spanish law states that two thirds of your assets automatically go to your children and you only have the free disposal on one third.

Get your budget in shape

A budget that maps out your expected income, fixed expenses such as rent or mortgage and card payments, what you plan to set aside for savings, and what’s available for everything else you may want can help you stay on track toward your financial goals. If you don’t already have a budget, the new-year milestone is a great time to start. If you’re already using a budget to help manage your finances, a year-end tune-up can help you make sure it’s still current.

Review your retirement-plan

Whether you are years away from retirement, or if it’s just around the corner, a new year is always a good time to review your current pension provisions. For some it might be just a case of making sure you are still on target to retire on your intended date, with an annual income that you desire. For others it may be a question of should I leave my pension where it is or explore other options? Planning for retirement is often pushed aside because life gets in the way, however a Chorus Financial adviser can help you plan for your retirement goals and work with you to achieve them. It’s also important to remember that if you have your pensions managed by a UK adviser, they are very unlikely to have the knowledge to properly plan for your retirement and to understand the tax implications of fiscal residency in Spain. This is one of several reasons that UK advisers are no longer willing, or possibly able, to work with Spanish residents after Brexit.

At Chorus Financial we are here to help you every step of the way. We work with clients to plan for their future financial goals and to ensure they stay on target to achieve them. For transparent, regulated pension & investment advice, with no hidden commissions or tie-ins, contact Chorus Financial today on 965 641 163, email or visit for more information.

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