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7 Important Topics Your U.S. Expat Advisor Should Review Annually

June 21, 2023
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A Guide to Your Annual Review as an American Living Abroad

Navigating your financial life as a U.S. expat can be challenging. You face unique challenges that require careful planning and the guidance of a team of experienced advisors. Because your financial situation, economic factors, tax treaties and other regulations are constantly changing, it’s important to check in on your financial plan at least once a year. Following are some important topics your advisor should cover in your annual review.

#1 Tax Planning

Tax planning is one of the most critical and complex financial aspects of being a U.S. expat. As an American living abroad, you’re still subject to U.S. tax laws, which can vary based on your country of residence. Your wealth advisor should spend a portion of your annual review offering guidance on how to optimize your tax situation, including helping you understand foreign tax credits, claiming exclusions or deductions, and complying with Foreign Bank Account Report (FBAR) requirements.

#2 Retirement Planning

It’s important not to let your retirement planning efforts slide while you’re living overseas. Your wealth advisor should lead an annual discussion about your retirement goals and savings progress. He or she should also offer guidance on Social Security benefits, foreign pension plans and other retirement savings vehicles in your country of residence.

#3 Estate Planning

Your U.S. estate plan may not hold up well once you move abroad. That’s why it’s important to check in with your advisor on a regular basis to ensure your estate planning documents continue to protect your assets and confirm your wealth will be passed down according to your wishes, should something unexpected happen to you. Your advisor should also offer guidance on how to handle inheritance laws in your country of residence.

#4 Investment Management

Your annual investment review shouldn’t be forgotten while you’re living abroad. Continue working with your advisor to maintain a diversified investment portfolio that takes into account your risk tolerance, financial goals and any unique investment opportunities available in your country of residence. Your advisor should also help you understand the unique investment opportunities and risks associated with living abroad, such as currency fluctuations and foreign investment regulations.

#5 Risk Management

As a U.S. expat, you face unique risks. On an annual basis, your advisor should review your strategies for dealing with unforeseen events, such as a medical emergency, natural disaster or job loss. As your situation changes over time, you may need to make adjustments to your emergency funds, insurance coverage and/or estate planning strategies to help ensure you continue effectively managing the risks you face.

#6 Banking and Currency Management

Managing your finances as a U.S. expat involves dealing with foreign currency, banking regulations and international money transfers. Your advisor should conduct an annual review to help ensure you’re managing your banking and currency needs in an efficient and cost-effective manner, maintaining appropriate local bank accounts and minimizing foreign exchange fees.

#7 Compliance with Foreign Financial Reporting Requirements

Another important topic to cover in your annual review is your compliance with various reporting requirements, such as those associated with Foreign Bank Account Reports (FBAR), the Foreign Account Tax Compliance Act (FATCA) and the foreign earned income exclusion (FEIE). Your advisor should provide guidance to ensure you remain compliant with all U.S. and foreign regulations in order to avoid potential penalties and legal issues.

If you could use some help with your annual financial review as a U.S. expat, Creative Planning International is here for you. We work with Americans abroad and cross-border families to help maximize their wealth and avoid costly mistakes. As expat fiduciary advisors, we understand the complex interaction of multi-jurisdiction tax and regulatory regimes and take into account currency management, diversification, tax and other considerations as we help you plan and invest for the future.

If you’re an American living abroad who could use some help optimizing your financial life, request a meeting with a member of our team.

This commentary is provided for general information purposes only, should not be construed as investment, tax or legal advice, and does not constitute an attorney/client relationship. Past performance of any market results is no assurance of future performance. The information contained herein has been obtained from sources deemed reliable but is not guaranteed.


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