Three Tips for Those Planning to Retire Abroad
Retirement is a time to reap the rewards of years of hard work and planning. For some, this may mean leaving the country to be closer to family, friends, or to simply take more time to explore the world. This can be a rewarding endeavor when done wisely. However, a failure to properly account for potential issues can lead to serious legal issues.
How can I mitigate issues when retiring abroad?
Proactive steps can help to better ensure your move abroad goes well. Three tips that can help ease this transition include:
- Review Social Security requirements. The Social Security Administration (SSA) can generally make payments to recipients living abroad. However, there are some locations that require certain criteria to be met before checks are issued. For example, some locations come with the requirement of the recipient check-in at a U.S. embassy every six months.
- Organize bank accounts. It is generally a good idea to have at least two accounts: one in the United States and another in the country you plan to retire.
- Stay in compliance with tax laws. Living abroad can come with unique tax issues. If foreign assets are valued at over $10,000 you will likely need to file a special tax form called the Report of Foreign Bank and Financial Accounts (FBAR). A failure to stay in compliance with tax laws can come with serious penalties.
It is also wise to revisit your estate plan. Update any bequests and review the plan to make sure it addresses any potential cross-border issues.
