Expat plotting a return
January 30, 2017 10:08 PM Subscribe
I'm a multi-decade US expat planning on a return to the US in 5-ish years (maybe even less). Help me with a few financial/planning questions!
So I've worked hard and been lucky, etc., and will probably have about $1-1.5 million US in cash by the time I return. I'll have no meaningful pension but will own real estate (hopefully drawing rental income) in my current country of residency. I'll be around 50 years old and my spouse is not a US citizen but will likely have a green card (if that's a good idea? Seems like it is?). We have no children and don't want any. I have no savings in the US, no bank account, no credit (or actively bad credit--I was a financial trainwreck when I left the US 20+ years ago).
What kinds of ducks do I need to get in a row? How can I go about buying property? There must be ways for me to develop good credit in the US, but should I be trying to qualify for a mortgage or should I try to buy with cash? Does it matter much where I go? I'm thinking the PNW, where I lived as young sprout, but I'm flexible as long as I'm in a cosmopolitan area, esp. a city.
Is there some particular kind of accountant or financial advisor I should talk to? Are there people who specialize in this sort of thing? What kinds of questions should I ask? I have literally no idea. None. I'm a floppy baby bunny who doesn't want to screw everything up for myself and my spouse.
And what about healthcare? Where I live now has good socialized healthcare, for the basics, at least. What do I have to know/plan? Is anything even knowable/plannable?
Ack I'm a mess!
So I've worked hard and been lucky, etc., and will probably have about $1-1.5 million US in cash by the time I return. I'll have no meaningful pension but will own real estate (hopefully drawing rental income) in my current country of residency. I'll be around 50 years old and my spouse is not a US citizen but will likely have a green card (if that's a good idea? Seems like it is?). We have no children and don't want any. I have no savings in the US, no bank account, no credit (or actively bad credit--I was a financial trainwreck when I left the US 20+ years ago).
What kinds of ducks do I need to get in a row? How can I go about buying property? There must be ways for me to develop good credit in the US, but should I be trying to qualify for a mortgage or should I try to buy with cash? Does it matter much where I go? I'm thinking the PNW, where I lived as young sprout, but I'm flexible as long as I'm in a cosmopolitan area, esp. a city.
Is there some particular kind of accountant or financial advisor I should talk to? Are there people who specialize in this sort of thing? What kinds of questions should I ask? I have literally no idea. None. I'm a floppy baby bunny who doesn't want to screw everything up for myself and my spouse.
And what about healthcare? Where I live now has good socialized healthcare, for the basics, at least. What do I have to know/plan? Is anything even knowable/plannable?
Ack I'm a mess!
If you haven't already, contact a CPA who specializes in ex-pat taxes about your IRS tax compliance, particularly relative to FATCA
posted by lois1950 at 11:10 PM on January 30, 2017 [4 favorites]
posted by lois1950 at 11:10 PM on January 30, 2017 [4 favorites]
Seconding contact a CPA. Hopefully you already have an accountant in your current country who's kept you compliant with FATCA?
Several things to keep in mind otherwise:
- Potential for the US currency to tank due to trade wars
- Immigration (your non-citizen spouse)
- Healthcare - you really need to read up on this. I'm sorry to be blunt, but I mean well because this has a huge impact on quality of life: you want to return to the US as a couple nearing retirement age, when this is a country where healthcare availability has historically been dependent on previous coverage, preexisting conditions, and statistical likelihood of illness and injury. In other words, you will be older and thus have a statistically higher likelihood of illness and injury, you will be coming from abroad without a history of coverage by US providers, and thus any condition you had abroad will be considered preexisting. All the more so for your spouse, who apparently has never lived in the States. I know this from my own experience; it's a big reason I stayed in France.
Is there any particular reason you don't want to retire in the country you're in now? You would at least have healthcare. You could always travel to the US.
posted by fraula at 1:32 AM on January 31, 2017 [6 favorites]
Several things to keep in mind otherwise:
- Potential for the US currency to tank due to trade wars
- Immigration (your non-citizen spouse)
- Healthcare - you really need to read up on this. I'm sorry to be blunt, but I mean well because this has a huge impact on quality of life: you want to return to the US as a couple nearing retirement age, when this is a country where healthcare availability has historically been dependent on previous coverage, preexisting conditions, and statistical likelihood of illness and injury. In other words, you will be older and thus have a statistically higher likelihood of illness and injury, you will be coming from abroad without a history of coverage by US providers, and thus any condition you had abroad will be considered preexisting. All the more so for your spouse, who apparently has never lived in the States. I know this from my own experience; it's a big reason I stayed in France.
Is there any particular reason you don't want to retire in the country you're in now? You would at least have healthcare. You could always travel to the US.
posted by fraula at 1:32 AM on January 31, 2017 [6 favorites]
It is a good thing you are planning the move well in advance.
As others have said above, the first thing would be to contact a CPA who regularly works with ex-pats and discuss your financial situation. Hopefully you have been filing US taxes every year all this while and kept in compliance with FATCA as well. If not, that would be the first duck to get in a row (unfortunately, it would likely be a costly duck in this case). If you will not only use the CPA for taxes, but also for financial planning (investment etc), then I strongly suggest to hire a CPA who charges a fixed fee rather than a percentage of the managed funds. If you Google 'USA expat CPA', you should find plenty of results.
Next, consider your health insurance coverage options. Do you plan to work in the U.S. when you return or start/manage your own business? The ACA (aka Obamacare) banned waiting periods for pre-existing condition coverage, but who knows how that is going to change by the time Trump and the GOP are done with their rampage? Previous to the ACA, health insurance companies could impose waiting period of up to 1 year for preexisting conditions.
Depending on your spouse's country of birth, the immigration process (as it stands now) can still take several months to more than a year. It is best to contact an immigration attorney at least 2 years before your planned move to get the ball rolling. Also keep track of immigration policy changes that the Trump administration is likely to implement.
Rebuilding your credit -- the first step would be to get your credit reports from the three credit reporting agencies. Once you move to the U.S, get a secured credit card and consider purchasing a house with a mortgage rather than buying it outright with cash even if you can afford it. Paying your mortgage on time every month is one of the best ways to build credit. Make sure your mortgage does not have any pre-payment penalty so that you can pay off in a year or two once your credit is in good shape. The same goes for buying a car using a loan instead of cash.
posted by thewildgreen at 7:31 PM on February 1, 2017 [1 favorite]
As others have said above, the first thing would be to contact a CPA who regularly works with ex-pats and discuss your financial situation. Hopefully you have been filing US taxes every year all this while and kept in compliance with FATCA as well. If not, that would be the first duck to get in a row (unfortunately, it would likely be a costly duck in this case). If you will not only use the CPA for taxes, but also for financial planning (investment etc), then I strongly suggest to hire a CPA who charges a fixed fee rather than a percentage of the managed funds. If you Google 'USA expat CPA', you should find plenty of results.
Next, consider your health insurance coverage options. Do you plan to work in the U.S. when you return or start/manage your own business? The ACA (aka Obamacare) banned waiting periods for pre-existing condition coverage, but who knows how that is going to change by the time Trump and the GOP are done with their rampage? Previous to the ACA, health insurance companies could impose waiting period of up to 1 year for preexisting conditions.
Depending on your spouse's country of birth, the immigration process (as it stands now) can still take several months to more than a year. It is best to contact an immigration attorney at least 2 years before your planned move to get the ball rolling. Also keep track of immigration policy changes that the Trump administration is likely to implement.
Rebuilding your credit -- the first step would be to get your credit reports from the three credit reporting agencies. Once you move to the U.S, get a secured credit card and consider purchasing a house with a mortgage rather than buying it outright with cash even if you can afford it. Paying your mortgage on time every month is one of the best ways to build credit. Make sure your mortgage does not have any pre-payment penalty so that you can pay off in a year or two once your credit is in good shape. The same goes for buying a car using a loan instead of cash.
posted by thewildgreen at 7:31 PM on February 1, 2017 [1 favorite]
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posted by poffin boffin at 10:35 PM on January 30, 2017 [11 favorites]