HOW TO MEET REQUIREMENTS

Steve Cronin, the founder of DeadSimpleSaving.com, which helps residents invest their own money, offers his advice on reaching the criteria required for a five-year visa for retirees:

Dh2 million property

In the UAE and in many countries, the minimum deposit needed for a house is 25 per cent. So you could reach the Dh2 million property threshold with a deposit of Dh500,000 and borrow the rest. The Central Bank of the UAE does not permit mortgage lending to expatriates over the age of 65, so the earlier you start, the lower your monthly instalments will be. This will help with cash flow but you may end up paying more over time, depending on interest rates.

Dh1m in savings

The fastest way to build up savings of Dh1m is to track your net worth and maximise your monthly savings rate by reducing your expenses and boosting your income. Invest in the global stock market via exchange-traded funds, such as the Vanguard All-World ETF (VWRD). This is ideal if you have at least 10 years before you retire and have time to ride out the ups and downs of the stock market. If you have less time, invest a greater percentage in bonds or property (for example, 20 to 40 per cent) so that a global market plunge just before you retire will not cause your savings to fall below the Dh1m threshold. You could also take a more conservative position in the year before the visa application and each five-year renewal, especially if your portfolio is close to the Dh1m mark.

Dh20,000 monthly income

Without a regular salary, you will need to generate Dh20,000 from either rental income from letting out property; dividend and capital growth income from an investment portfolio; profit from side hustles or dividends from owning a business. With a typical UAE rental yield of 5 to 10 per cent, you would need a property worth Dh2.4 to Dh4.8m to generate the threshold income from rent. From a stock portfolio, you could safely withdraw 3 to 4 per cent per year as income, requiring a portfolio of Dh6 to 8m. You can always mix your income from multiple sources and this will make it more resilient – some from property, some from stock