Retirement Planning for Long-Term Care
One of the fundamental mistakes people make when planning for retirement in the US is to underestimate the possibility of developing a long-term chronic health condition and the impact that such an occurrence is likely to have on their spending power.
Yet the truth is that because we are living longer than ever before we are also more likely to need some form of help with the basics of day-to-day existence. Quite simply, whether by illness, accident, physical debilitation or mental decline, incapacitation and the consequent need for long-term care can happen to anyone.
Consolidate your 401ks into an IRA for Legacy Planning
A 401(k) can be a bedrock part of your retirement and legacy planning in the US, but what do you do if you feel that yours is no longer the right vehicle for your long-term strategy or you find yourself struggling as you try to balance multiple small accounts from several jobs?
Of course, not everyone takes the same approach to their old 401k(s) once they move to a new workplace: many workers opt to leave their money in the plan while a minority will transfer it into a IRA.
However, the majority may be missing an opportunity; IRA consolidation is a way to avoid the drawbacks of remaining invested in an unsuitable 401k plan while also opening up many potential benefits.
Your UK Pension in the US
If you decide to settled in the United States after a life of living and working in the United Kingdom, you will have to work out what you should do with your UK pensions in the US. Understanding how to manage your existing international pensions is crucial to your financial longevity in the USA.
In this situation, you have three main options for any defined contribution pension fund in the UK of which you are a member:
Retirement Account Rules and Restrictions for Non-Resident Aliens
Non-resident aliens are those people who are citizens of a country other than the United States but with legal permission to live and work within the US. If you are in this position you should be aware that your status means you have some very particular obligations to the Internal Revenue Service (IRS) and that these have an impact on any 401k or IRA accounts you might hold.
So, what are the 401k and IRA management considerations for US non-residents and what are some of the restrictions affecting non-residents in relation to these accounts?
Forms of Interest for Expats Paying Tax in the US
If you are an expat paying tax in the United States, you will need to be sure that you are compliant with the annual income and asset filing requirements. Not only will taking steps to understand your obligations help you ensure that you are in line with the law, it also gives you the clarity to plan and structure your wealth and tax affairs so that you can move towards your longer term financial and retirement goals.
Here we look at some of the forms you may need to complete.
Inheritance Planning Options for the Expat
If you are a non-resident alien or green card holder living in the United States you will have important decisions to make regarding your wealth management and inheritance tax planning.
While it is always a difficult subject to contemplate, thinking about the future and what will happen to your wealth and assets once you are gone is definitely something which requires forethought and advice from an international financial adviser, especially if you are living abroad.
So, here at Blacktower in the US, we have put together a short guide featuring some of the main considerations.
Roth IRAs, the Five-Year Rule for Expats
If you've recently moved to the US from Britain or another country and found the question of pension and retirement planning in your home country to be troublesome, be prepared: retirement planning in the US can be a complex process and making the most of the much-talked about Roth IRA is no different.
Understanding Social Security When Retiring Outside of the United States
Understanding and structuring retirement and pension plans in the United States is a difficult and complex task even at the best of times.
In fact, it is little wonder that so few British expats are able to make sense of retirement planning in the US when even US citizens struggle to do the same without anything like the same level of cross-border tax and income reporting obligations.
Things can get even more complicated in the event that as an expat you decide to eventually retire outside of the US but have built up some eligibility for US Social Security benefits; what, ask many expat wealth management clients, are your rights and responsibilities in such a situation?