What To Consider When Moving Abroad

By Danielle Arlotta, CFP®, Lead Planner

As remote work has become more popular, we get a lot of clients who want to spend more time traveling or immigrating outside the U.S. It can be a daunting decision for some people as there is a lot to think through. I live between Paris and New Jersey and have helped clients in this process as well, so I can speak from personal experience about the preparation needed. 

I can talk a lot about the emotional and administrative aspects of living outside the U.S., which I’m happy to do on the upcoming virtual salon. However, I’m a financial planner so I want to talk about the financial aspects, which are not as fun but incredibly important. 

The first thing I walk clients considering a move abroad through are earning income, rent, and actual moving costs. The first questions I give them to think about, in order of priority, are:

  1. How will you earn income and how much will you earn monthly? 
  2. What will rent and other fixed expenses be? (cell phone, public transport, car, insurance)
  3. How much will your moving expenses be?

Once you have the answers to those questions we are able to create a strategy to save and plan for your move. 

However, there’s a lot more that goes into moving and it’s important to talk about the hidden “costs.”  Visas and resident permits are the first hurdle. Every country is different, but most have pretty high costs for visas and resident cards. If you are not coming with a secured salaried position, you usually need to prove that you can support yourself for a certain amount of time by showing proof of funds. Many countries will ask that you transfer it to a bank account in their country once you arrive. 

Bank accounts are the second issue. If you’re an American citizen, you’ll have to fill out extra paperwork to open a bank account in a foreign country. This is because the U.S. requires all foreign banks to report American citizens’ accounts back to the U.S. 

The U.S. also requires you to file taxes as long as you are a citizen, regardless of resident status. Generally, you are not double taxed as there are deductions for foreign earned income. But, you still have to file your taxes annually in the U.S., as well as the country you are living in, if you’re a resident. If you use a CPA or even a tax software this will be a higher fee than your normal tax filing service. 

Below are some other overlooked costs:

  • Guarantor for renting an apartment
  • Bank account monthly fees
  • Health insurance
  • Translated documents
  • New documents (i.e. birth certificates, marriage certificates)
  • Drivers licenses and test

Moving is a lot to think about in general, moving to a different country is no different. It’s important to know what you are in for so that your finances can support you. Once you have addressed these concerns and have a good plan in place, you can enjoy your new home!

More Resources:

Work in Australia with a 12-month  working holiday visa (35 and under)

Spain’s Digital Nomad Visa Program

Other countries offering digital nomad visas

Recent Posts

Subscribe to our newsletter

Share