TaxProfessionals.com
Posted by Income Taxes and Bookkeeping LLC

How to Prepare Your Finances If You're Planning to Retire Abroad

How to Prepare Your Finances If You're Planning to Retire Abroad

For many workers close to retirement, the desire to settle somewhere cozy and quiet, away from the hustle and bustle of their working years, is real. If the idea is to enjoy retirement, no one wants to spend more than is necessary. But the plan to settle abroad could be really costly.

Retiring abroad is not a bad idea. However, it would take a lot of preparation if you must get it right. It's more like going on holiday for life! What's not to love about that? 

The two main reasons why people are now settling internationally are the cost of living, which is cheaper, and the dream of exploring new cultures. However, many have never considered it because it sounds too complicated. Let's break it down for you. Maybe you may change your mind and choose to settle abroad.

It is difficult enough preparing for retirement locally. Preparing to settle down in a foreign country can therefore be overwhelming. Only 25% of retirees ever felt they've prepared adequately enough for their retirement years in America. Preparing for retirement abroad can't be any less demanding. 


However, it can be done. Here's how.

  • Get expert financial advice.

Retiring abroad is a long-term plan. It's not something you decide on suddenly. Your financial adviser would have all the information relating to the laws of the country in question and the best financial decisions to make before moving. 

When you've decided about relocating, you need to know how much you have to set aside from your earnings to fulfill your dream. Depending on your income, you may need to sell your house before finally relocating. Moving out of the US may still have tax implications for your taxes. You're likely to still have financial obligations to the US government. You need to sort out all of these carefully. 

  • Readjust your savings ahead of retirement

Readjusting your savings is the key. Most of those that retire abroad plan for it for decades. This means you may have to increase your monthly contributions. If you must retire in a foreign country, you should be able to set aside enough before leaving. 

The cost of living and expenses like healthcare costs in that country must be factored into what your savings would look like. Remember, you'll have extra visas, flight tickets, and even housing expenses. You're encouraged to have more long-term investments, more wide-ranged investments, and riskier investments for a long time.

  • Seek expert entrepreneurship opportunities

Many retirees still love to work part-time. If you need to work as an expert to earn more, you need to know the country's laws and what the requirements are for experts. If you plan to explore the country and have saved enough, this may not be an issue. However, earning something extra in a new country can't be bad.

  • Plan for Housing

One of the significant extra expenses for those moving abroad is housing. You should decide whether to buy a house or rent one from your plan. However, even if you would eventually buy a home, it is better to rent one first. If you've sold your home in the States, it is assumed that the cost for another one in a foreign country would be cheaper.


Conclusion 

The retiree is expected to know a lot about the residency requirements and healthcare costs before leaving. It is also ideal to go on mini-vacations before finally settling down after retirement. This is to familiarize the worker with the lifestyle and culture of the community before finally settling down there. 

Retiring abroad is a great idea, but a lot of preparation is required. If you're nursing that idea, the time to start preparing is now!


FOR MORE INFORMATION ON HOW INCOME TAXES & BOOKKEEPING, LLC. CAN BEST HELP YOU WITH YOUR TAX FILING NEEDS, PLEASE CLICK THE BLUE TAB ON THIS PAGE.


THANKS FOR VISITING.

Income Taxes and Bookkeeping LLC
Contact Member