In recent months we have seen the Euro gain strength against the pound. Now, for those from the continent travelling to UK this is good news as their Euro now goes further but for UK pensioners who have chosen to enjoy their retirement in the sun it is NOT so good!

In Spain it is not just the rise of the Euro that has hit hard - combine this with the rise in inflation and those who are relying on the Pound whilst living here are being hit hardest of all.

A few years ago a £400 pension was bringing in as much as €600 compared to approximately €400 as has been seen recently. Utilities have risen in cost as has basic food items which means that many pensioners are now struggling to meet their commitments here in Spain. According to sources the cost of living here in Spain has risen by a third, whilst most incomes earned here have stayed the same or, in the case of expats relying on UK income, their money has decreased.

Many people, both retired and non-retired, are having to make substantial cut backs just to keep their heads above water. With increased mortgage payments added to all the other day-to-day costs and the falling pound retirement or life in the sun suddenly doesn't seem quite so rosy!

If you are relying on your UK pension here in Spain then shop around at the various money exchange companies and see what rates they can offer you. Many of them offer a locked rate system which allows you to stick to a set rate for a period of time. Of course if the rate increases during that period you can lose out slightly but in recent climes it has been beneficial to people who chose the locked rate system for their pension.

Many pensioners are feeling the crunch so badly that many are returning to the UK and renting out their Spanish properties rather than trying to sell them. A lot of people truly do not want to give up their properties in the sun and see going back to the UK, for the interim, a solution to the immediate problem. (Of course this is not an option for everyone!)

If you have a Euro mortgage then by renting your property out you can earn an income in Euros that can help towards mortgage costs rather than relying on your UK income. This may give you some breathing space until some strength comes back to the Pound.

However, in the long run would you be better off back in Blighty? Costs are rocketing, the lifestyle is definitely not about lazy lunches on the beach or lying by the pool, it is not as safe as it used to be, and the weather is appalling. Would your pound go further in England and give you the lifestyle that you crave so much?

Each case is different and individual and only you can decide what is best for you as a couple or a family.