State pensioners could lose up to £77,000 in Department for Work and Pensions (DWP) income if they retire overseas, according to a new warning. Retirees moving to countries where payments are frozen will sacrifice more than £77,000 in state pension income over 20 years.
This analysis from Rathbones, a leading UK wealth and asset management group, highlights the impact of the triple lock policy. The triple lock ensures the state pension rises annually by the highest of inflation, average earnings growth, or 2.5%. However, for retirees moving to certain countries—including Canada, Australia, and New Zealand—state pension payments are frozen at the rate first received, with no future increases.
Olly Cheng, Financial Planning Divisional Lead at Rathbones, said: "We often speak to people hoping to retire overseas, many of whom don’t realise that this decision could significantly affect their state pension entitlement."
Rathbones' calculations show a pensioner living overseas for 20 years could lose £77,585 in state pension income alone, entirely due to missed annual increases. This assumes the full new flat-rate state pension totalling £12,547.60 from April 2026, uprated by 2.5% per year in line with the triple lock.
Even over shorter periods, the impact is significant. After just 10 years abroad, retirees could be more than £18,600 worse off, rising to over £42,000 after 15 years. A loss of £77,585 over 20 years is equivalent to around £3,880 a year, or £320 a month over 20 years, that retirees would need to generate from other sources.
Cheng added: "The state pension is uprated every year under the triple lock to help keep pace with the rising cost of living. If your pension is frozen when you move abroad, those increases stop entirely. Over time, inflation steadily eats away at its value, meaning your state pension buys less each year in real terms. What looks like a modest shortfall at first can quickly snowball into tens of thousands of pounds in lost income over retirement, and once your pension is frozen, there’s very little you can do to undo the damage."
