Beacon Global

The Three Pillars of Retirement Planning and a Guide for Expats
www.beaconfinancialeducation.org

You’ve worked a long, successful career as an expat in a foreign country and you’ve been saving for retirement for a while. Or maybe you haven’t started. Either way, this guide will bring up the important questions to ask yourself as you plan your great ‘ride off in to the sunset’. Also, this article will serve as a beginner level guide to expats looking to maximize their retirement fund.

Before we get into the specifics of retiring as an expat, let’s talk about the three pillars rules of retirement planning.

Be Practical

When planning out your retirement, make sure to be down-to-earth when considering costs. One important cost is healthcare. It is an important cost and often overlooked. Be realistic with your retirement plan and it will pay off later.

Diversify your Portfolio

Funding your retirement with different sources of income can result in greater stability and peace of mind. It’s never a good idea to put all your eggs in one basket. One way to diversify your portfolio is to invest in property. Property can bring a steady stream of income and financial security in the long run for your family and loved ones.

Plan for Uncertainty

Planning for uncertainty can give you a soft cushion if something happens and peace of mind if something doesn’t. When it comes to retirement, emergencies can happen. Keeping this in consideration will make you confident that your retirement fund can handle any unforeseen circumstances.

Now that we’ve covered the basics, let’s get in to some specific advice for expatriates. Expatriates should consider a number of things in retirement including rules on social security benefits, where to retire, and where to hold investments.

Collecting Social Security as an Expat

Throughout your career domestically and abroad, you’ve most likely paid into your country’s social security program. However, there are rules and requirements that may prevent you from collecting these benefits due to your expatriate status. Social Security retirement benefits in the U.S. apply to anyone who has contributed to social security in a minimum of 40 cumulative quarters (10 years). If you’ve contributed this amount of social security in the U.S., then you are eligible for benefits. But what if you haven’t? As an example, let’s say you’ve contributed 30 quarters of social security in the U.S and 10 quarters in a country abroad. Well, you aren’t entirely out of luck. The United States has agreements, called Totalization agreements, with 26 countries (including the United Kingdom) that provide social security benefits to expatriates who have contributed the minimum 40 quarters of social security in both domestically and abroad. In Totalization agreements, each country agrees to contribute the proportional amount of benefits based on how much they have contributed. So let’s take our earlier example. In this case, the U.S. would provide 75% of the benefits, and the foreign country would provide 25%. As stated earlier, only 26 countries are in Totalization agreements with the U.S. so make sure to check the list below* to see if yours qualifies.

Where to Retire

As an expatriate living abroad, you are no stranger to foreign countries and cultures. You may even want to retire in an entirely new country! The first thing to consider when choosing a retirement country is the cost of living. Different countries have different costs of living. Rent, transportation, dining out, are among the things you’ll have to factor in to calculate this cost. Secondly, you’ll have to be aware of the tax rules of the country you are in. These tax rules are tricky and often vary indiscriminately from country to country so you’ll want to check with your financial advisor on how best to navigate your specific country’s rules.

Where to Hold Investments

If you’ve worked in different countries in your career, you may just hold investments in each one of these countries. It may make sense to consolidate these investments. Checking with your financial advisor on how to manage and/or consolidate your foreign assets is the best way to go. 

* List of Countries with U.S. Totalization Agreements

Australia, Austria, Belgium, Canada, Chile, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Japan, Luxembourg, Netherlands, Norway, Poland, Portugal, Slovak Republic, South Korea, Spain, Sweden, Switzerland & the United Kingdom.

Beacon Financial Education does not provide financial, tax or legal advice. None of the information on this site should be considered financial, tax or legal advice. You should consult your financial, tax or legal advisers for information concerning your own specific tax/legal situation.

>> MORE EXPAT ADVICE

Beacon Global Seminars
Understanding the Implications of US FATCA

Financial Experts, Beacon Financial Education / Beacon Global Group, are returning to London this fall, with a new set of financial awareness seminars for American expats and US connected individuals. Apart from their basic/intermediate level “Understanding Expat Finances”, they will introduce the advanced level “Investment Diversification & Portfolio Management” as well as the Americans / US Nexus only seminar “Understanding the implications of US FATCA” this fall.

The seminars covers a range of topics from Lifestyle Planning and (Cross-Border) Retirement Strategies, as well as International Life Insurance Strategies and Tax Efficient Inheritance Planning to Investment Diversification, Portfolio Management and – of course – US FATCA compliant Wealth Management.

IMMEDIATE REGISTRATION to attend one’s (or more) of BFE’s free seminars

Event Calendar

September 7, 2017: Understanding Expat Finances | CCT Barbican - Register Here
September 21, 2017: Understanding Expat Finances | Crowne Plaza Kensington - Register Here
October 5, 2017: Understanding the Implications of US FATCA | CCT Barbican - Register Here
October 19, 2017: Understanding the Implications of US FATCA | Crowne Plaza Kensington - Register Here
November 2, 2017: Investment Diversification & Portfolio Management | CCT Barbican - Register Here
November 16, 2017: Investment Diversification & Portfolio Management | Hilton Cobham - Register Here
November 30, 2017: Understanding the Implications of US FATCA | CCT Barbican - Register Here

Venues:
CCT Venue Barbican, 135-137 Aldersgate Street, LONDON, EC1A 4JA
Crowne Plaza Kensington, 100 Cromwell Road,  LONDON, SW7 4ER
Hilton Cobham, Seven Hills Road South, COBHAM, K11 1EW

To find out more about Beacon Financial Education/Beacon Global Group or if you wish to have a private consultation with one of their independent financial advisors, do contact them via their website at http://www.beaconfinancialeducation.org

Beacon Financial Education does not provide financial, tax or legal advice. None of the information on this site should be considered financial, tax or legal advice. You should consult your financial, tax or legal advisers for information concerning your own specific tax/legal situation.

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