Critical Planning Points for an Overseas Move
You need to have a strong sense of adventure to move overseas, that’s certain. But according to “Moving Abroad? Here’s the Checklist” from The Wall Street Journal, Americans relocating overseas also need to check on a number of financial and legal matters well in advance.
Insurance. These regulations are frequently at the country or state level, so insurance that is valid or that can be sold in one jurisdiction may often not be sold or used in another. If you are a resident of two countries, and each has mandatory health insurance, it may be difficult to locate a provider whose insurance is accepted (for medical and tax purposes) in more than one country. Long-term care and disability policies are often not valid or have reduced benefits outside of the country where they’re purchased. Life insurance, if issued some time ago, can usually be kept when you move overseas—but you may see some currency risk and financial regulations for policies with a cash or investment account associated with them. Auto insurance isn’t typically portable.
Investment Planning. These regulations vary by country, so be certain to work with people who understand your situation and are competent to provide cross-border services. U.S. expats should know that most foreign investments may be subject to punitive U.S. taxation and costly compliance. Investing in U.S. exchange traded funds or individual stocks is usually a better option, with U.S. mutual fund investments generally off-limits to investors living outside the U.S.
Estate Planning. These laws are different from one jurisdiction to the next. With an international move, your estate planning may no longer be valid, so talk with an experienced international estate-planning attorney.
Government Benefits. Will you still be eligible for government benefits like welfare, Medicare, and others if you live outside of the United States? If you are moving for a job, what kind of government benefits will you be eligible for if your position is terminated? Those planning to retire overseas are not able to tap Medicare and will have to make necessary preparations to pay for their own health care. Also, find out if and how Social Security benefits will be paid to you while living in another country.
Reference: Wall Street Journal (September 29, 2016) “Moving Abroad? Here’s the Checklist”