Have you ever considered moving internationally? In recent years many retirees have found that there are many places around the world that provide a peaceful, welcoming environment at a much lower cost than if they stayed at home.
If you’re considering moving overseas, then your first order of business should be getting your finances in order. You may think that packing and finding movers is at the top of your priorities, but the fact is that you can run into serious problems in your new home if the money is not in order. It’s best to tend to these issues now so that you can avoid problems when you’re trying to get settled in to your new environment.
Consider Every Bill and Cancel All Recurring Charges
It’s easier to just do this all at one time. Before you pack a single box, contact every service provider with whom you have recurring payments set up. This can include anyone from the cell phone company to your cable television and even the gym membership. You won’t be using most of these services any longer, and you don’t want to wait months to get a refund on something.
More importantly, you don’t want a company to try to run a payment and have it denied because the account is closed and then start charging you late fees. Contact these providers, clarify your last date of service, stop the automatic payments, and have them send you an e-mail confirming all of this information.
Dual Accounts
It’s also wise to keep the American account for a while in addition to your new foreign account. If you do have problems with the finances here in the States, it will be easier to resolve if you still have an active, domestic account. When you set up an account in your new country, be sure to choose a financial institution with reliable currency conversion services. Many expats find that transferring funds using a Schwab checking account and either a Schwab or a Capital One credit card has the lowest fees. Be aware that if your foreign bank accounts total more than $10,000 you are required to file additional forms even if you owe zero tax. These include an FBAR form and FATCA—the Foreign Account Tax Compliance Act Form 8938.
The Best Conversion Rates
When you’re sending your money to the new country, take the time to shop around for the best conversion rates. While government agencies may determine the daily exchange rate, remember that every institution has the option of charging additional fees. As you shrink those fees, you can easily save money with Sharemoney.com or similar providers.
Emergency Funds
Even if you are moving for a job, you should still have enough money in the bank to survive for three to six months. Other governments do not have the unemployment safety nets that we have here in the United States, and you want to be prepared in case the unexpected happens.
Moving overseas can be exciting and frightening all at the same time. You can prepare yourself ahead of time by taking care with your finances. A little planning and preparation before the move can help you save headaches afterwards.
