Getting Your Finances Ready to Retire Abroad
Making the big decision to retire abroad is an exciting endeavor. There will be a lot of steps involved to make the move and arrival smooth and seamless. One big component will be getting your finances organized ahead of time. This is especially important if you plan on buying property or opening a business at some point in the near future. While everyone’s financial situation is different, following is a solid list to start with.
- Social Security: This should be relatively easy to deal with. The eligibility rules for collecting Social Security benefits outside the United States can differ depending on whether you’re a U.S. citizen or non-U.S. citizen. Normally, payments can be forwarded to the bank account of your choice. You might, however, incur fees from banking transfers and currency exchange. Every bank is different so work with them to set this up appropriately. If you’re considering a move abroad and you collect Social Security, research the situation carefully before you move.
- Planning for Your Estate: Writing up a will is never a fun topic, but it can be even less so if your foreign assets aren’t protected. For instance, a will created in the United States only has jurisdiction there, so anything you acquire abroad might not be included or accessible. Working with a local attorney in your new country is the best way to negate any problems down the road.
- Insurance and Health Care: More than likely, you won’t be covered for medical expenses by Medicare or your normal provider once you’ve gone international. Many countries offer fantastic benefit programs for retirees, but if this isn’t the case, you’ll have to take on the burden of finding insurance abroad.
- Real Estate: Although this can be a surprise to many, property law and ownership varies drastically from country to country. For example, some countries will gladly allow you to buy a house or business, but then they create lots of red tape or make it virtually impossible for expats to sell a property. Don’t let this scare you away from acquiring your dream home, but make sure you understand all the logistics before jumping in head first.
- Taxes: Depending on your investments and if you’ll have a working retirement, where you live and how you organize your taxes can make a huge difference. Even if you’ve been handling your own finances for years, this is another instance where you’ll want to consult with either an international tax specialist or a local accountant to get things right the first time around.
Taking your life and finances abroad can be a rewarding and potentially lucrative experience for your retirement. All it takes is some serious planning and expert advice and you’ll be well on your way to your beachfront villa.
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