You’ve sorted out where you are going to live and you know how you are going to make a living in the US. The flights are booked and you’re ready to go – but wait; don’t forget about the crucial financial planning tasks you need to consider before and during your move to the United States. It is important to think about how you are going to deal with the following issues if you are an expat moving to the States:
1. Obtaining a Visa/ Citizenship
It is possible to live and work in the US through a number of visa permissions, and your visa status is certainly something you need to sort out before you consider moving to the United States. Take a further look at the options with the help of an immigration lawyer or immigration expert – you can get a work visa through employer sponsorship, study at a US university, invest in the United States via your business, become an asylum seeker, be sponsored for a visa by a family member in the US, get a visa by means of your talents or profession, or apply for the Diversity Lottery.
2. Reporting on Non-US Financial Accounts/ Taxation
If you have investments in your country of origin or elsewhere in the world, you need to register these funds with the US Treasury Department, considering that the amount saved is more than $10,000. You may need to pay tax on these funds – find out more about FBAR here. It is very important to look into this issue as there are penalties for non-reporting. The thing to remember is when you have money in non-US accounts it could still be taxable when you are living in the US. Check it out with a tax attorney specializing in expat tax issues if you are not sure.
3. Getting a Loan in the US
It can be very difficult to get a loan when you are living in the US as you will not have built up sufficient credit history in the US to be able to apply. Be careful if you think that you will have to get a loan in the first few years of living in the States – it is much better to be able to support yourself with savings or employment in the early years. When you arrive in the US open a US bank account, get a debit or credit card attached to the account, and build up a credit history by safely spending and saving money in the US.
4. Transferring Your Pension to the US
Another tricky matter is transferring an overseas pension to the US. In most cases it is near to impossible to transfer a pension scheme from abroad into a US account. Again, this is an area where you need to consult a tax attorney or tax specialist. There are ways in which you can move an overseas pension to a US scheme via a work-related scheme, or by transferring it first to a different country and then moving it to the US. You may be penalized if you do not follow strict rules, so get advice before you try these tactics.
5. Save for Education and Retirement
When you are living in the US you will quickly realize how expensive it is to send your children to college, and also to live once you are retired. It is important to look into saving for these events as early as possible if you do not already have sufficient funds to pay for them. You can save money for college or for your retirement in a number of ways that save on your tax bill. You will certainly find these plans useful if you are planning to settle permanently in the US, or at least until retirement or college leaving age. If you do decide to move away from the US before college or retirement, bear in mind that you may not have any further access to the money saved in these plans.
In all cases, when you are moving to the US take advice from a tax or immigration professional if any of these issues affect you. By using some forward planning you can make your move to the US smoother and more successful.