One of the most important aspects to consider when relocating to a new country is your quality of life. Wealth management for expats is an essential consideration to ensure that your standard of living is sustainable and that you maximise the value of your financial and physical assets to sustain a secure and comfortable life in your destination of choice.
Different countries have different rules, policies and legislation, which means that understanding the local systems is crucial. These can vary significantly, and once you start to think about property purchases, income tax, pensions, savings, wills and inheritance it becomes clear why this is so vital!
Aspects of Wealth Management for Expats to Consider
Along with the logistics of relocating, wealth management looks at all aspects of taxation. This includes income tax on your earnings, inheritance tax planning, clarifying your residency status and what this means for your tax position, and ensuring that your pension is accessible in your new home country.
As an expat, whether you have already relocated to your dream retirement location or are planning to move with your family to warmer climes, investing some time in understanding the local financial systems is well worth the effort. It is all too easy to become unstuck by not having understood how local tax laws might impact your regular income or access to your financial assets, so doing your homework now will save problems in the future!
Education Planning in a New Country
Many expats choose to relocate to a country with mild weather, a high standard of living and offering an aspirational lifestyle. If you are relocating or planning a move with children it is particularly important to consider their education, and how the system will work in your new home.
Some countries have outstanding education systems, and so you should research the application process for school placement, how far in advance this should be made, and the criteria for acceptance.
In other countries, you may opt for private education. Likewise, young adults seeking to continue their education through college or university, or a family member looking for professional training or higher education opportunities will need to understand the cost implications and application processes to be able to plan.
Making future education accessible and affordable through education savings planning is key to safeguarding your future by providing carefully for the associated costs.
Savings and Investments
Should you have financial assets, hold long-term investments, or need to plan for your pension scheme, you will need to know what tax rules are in place at your destination, and how this will impact your assets.
Investment options will differ in rates of return and deciding whether to transfer any savings to a finance provider in your new country, or leaving them in situ is usually dependant on a comparison of the tax benefits available in each case.
Some savings may not be easily accessible from abroad, so it is vital to understand the international mobility of your savings, and what actions are needed to future-proof your access to your income.
Your ideal savings products will be dependent on a lot of factors including your acceptable level of risk, how regularly you require income streams to arrive from your investments, and what your long-term plans are.
Appointing a Wealth Management Expert
Appointing a wealth management professional or firm is one of the best ways to ensure that you understand the opportunities for tax efficiency, and do not fall foul of any laws after you relocate.
Many tax schemes are dependent on your residency and/or citizenship status, and a wealth management expert with a comprehensive knowledge of the taxation system in your new country will be able to advise on the optimal solution to protect your income and provide for the future.
An expert can help with:
- Advice on how to structure your savings and investments to align your income with your lifestyle requirements
- Providing education savings plans to provide for your family’s needs for the years to come
- Retirement planning and UK pension transfers
- Structuring your assets to optimise taxation benefits available
- Managing your taxation and residency status
- Advising on property and asset purchase legislation
- Securing cost-effective solutions to restructure your wealth to best suit your needs
Choosing a Professional
When appointing a professional to assist you in managing your wealth alongside your relocation, there are key factors to consider:
- Are they based locally?
Whilst there are many international wealth management providers, having a professional who is based in your new country, and has a thorough understanding of the local regulations is essential. Remember that in some countries, national regulations are superseded by local jurisdictional rules, and so finding an expert based locally who knows the local community, understands the area and can provide on the ground advice is important.
- Are they fully accredited?
There is a huge amount of advice and information available through online forums and advice lines. However, one individuals’ experience may vary significantly from yours as their wealth management advice may not be relevant to somebody of a different age, with a different taxation or residency status, or with different assets that need to be protected. Always use a regulated professional and visit the website of their association or trade body to verify that they have the expertise you need to provide tailored and up to date advice.
- Are they established?
Every business starts somewhere, but with the importance of wealth management for expats it is preferable to find an expert who is established and has an office or premises based in the local area. Remote working is less suited for an expat seeking personal support and finding a professional who can attend meetings in person and provide face-to-face advice is the best solution.
Chase Buchanan is a highly regulated wealth management company, specialising in providing global finance solutions for those with a global lifestyle.
*Information correct as at April 2020