relocating overseas

Relocating overseas: How to prepare for your move

Our comprehensive guide covers everything you need to know to make your move abroad successful and stress-free.

Are you thinking about moving overseas? If you are, you’re not alone. It’s estimated that 2.2 million to 6.8 million U.S. citizens have moved abroad. Some are seeking a more affordable retirement, some are seeking a new adventure, and others are embarking on a new job opportunity.

Whatever the reason for your move, it can be a complicated and foreign process. But with the help of this guide, we’ll make sure that you’re armed with all of the knowledge you need to make your move successful and stress-free.

Documentation and permissions

Passport and Visas when relocating abroad

Before making your international move, you’ll need to first secure a passport and a visa, possibly more than one.

Passport. U.S. citizens must carry and present their passport when leaving and entering the U.S. Make sure your passport is valid for the entire time that you intend to live abroad plus 6 months. If you need to apply for a new passport or renew your current one, do this early on in the process. It takes the government approximately 6 weeks to process your passport request.

Visa. You’ll need to obtain a visa from the country that you intend to move to. Visa eligibility varies from country to country. A visa that allows you to take up residence in that country doesn’t necessarily grant you permission to work in the country. Some countries require a special visa to work or a work permit. So it is imperative that you explore the rules and requirements for the country that you you wish to relocate to. Your pets also need to have proper documentation.

Why you should register your travel

STEP: The Smart Traveler Enrollment Program

The U.S. government encourages its citizens to register with its STEP service when traveling or moving abroad. It allows U.S. citizens to enroll with the nearest U.S. Embassy or Consulate.

With STEP you will:

  • Receive safety and security information for your destination country.
  • Provide the U.S. Embassy with the info they need to contact you in case of an emergency, such as a natural disaster, civil unrest of a family emergency.
  • Receive security and emergency updates from the U.S. Embassy, as well as travel warnings and alerts.

Citizenship/nationality and your rights and obligations

Dual nationality

U.S. citizens are permitted to hold dual nationality if it is granted automatically through the laws of a different country. For example, if a U.S. citizen couple gives birth to a child while abroad and that country automatically grants that child nationality. That baby would hold dual nationality for the U.S. and the foreign country. Or if a U.S. citizen acquires nationality through marriage. The U.S. government does not require the U.S. citizen to choose one nationality over the other in these cases.

However, the U.S. does not permit dual nationality if it is acquired by choice. The U.S. government explains it like this: “A person who acquires a foreign nationality by applying for it may lose U.S. nationality. In order to lose U.S. nationality, the law requires that the person must apply for the foreign nationality voluntarily, by free choice, and with the intention to give up U.S. nationality.”

Moving overseas and voting

If you do not intend to relinquish your U.S. citizenship when you move to another country, you can continue to participate in U.S. elections by voting with an absentee ballot. Almost all U.S. citizens 18 years or older who reside outside the United States are eligible to vote absentee for candidates for federal offices in U.S. primary and general elections. In addition, some states allow overseas citizens to vote for candidates for state and local offices, as well as for state and local referendums. Check with your state for specifics.

Paying taxes when you move abroad

All U.S. citizens and resident aliens must file a tax return, whether they are living in the United States or in another country. Your income is subject to U.S. income tax no matter where you are living. You can file your tax return electronically or through the mail.

Unfortunately, you will also be required to file income taxes in your new country of residence. But keep in mind that although the requirement to FILE your taxes is the same no matter where you live, the amount that you PAY is quite different. The IRS allows for two methods to greatly reduce the amount of income tax you must pay: the Foreign Earned Income Exclusion and the Foreign Tax Credit. Learn more about it from the IRS.

Your Social Security benefits

If you plan on retiring abroad, whether permanently or temporarily, you will most likely be able to receive Social Security benefits. It all depends on which country you will be retiring to. Use the Social Security Administration’s Payments Abroad Screening Tool to find out if your country of choice is included in the list.

Your health

Health insurance. Some health insurance providers will cover medical care while living and traveling overseas. But many do not. Contact your health insurance provider to find out if you are covered in another country, and exactly what the coverage entails.

If your health insurance does not offer you coverage while abroad, there are many U.S.-based and international providers from which you can purchase health insurance.

Medicaid and Medicare. Neither medicaid nor Medicare is available to U.S. citizens living overseas. These programs only cover medical costs within the U.S. 

Life insurance. As with health insurance, your policy may transfer with you when you relocate. You may only need to provide your insurer with a change of address. Be sure to check with your provider to confirm that you will receive the same coverage and benefits. If your provider does not cover you while living in another country, there are plenty of life insurance companies that offer coverage. Search around around for the best quote.

Frequently asked questions

As private health funds in Australia will not offer cover when you’re overseas, there will be no need for you to continue paying your premiums. But rather than cancelling your cover altogether and then having to sign up (and possibly losing out on discounts) when you return, ask your health fund about temporarily suspending cover and then resuming it when you return.

Before you leave the U.S., it’s a great idea to contact your real estate agent and ask them for a reference. This reference can explain how you always paid your rent on time, kept the property in excellent condition and were generally an excellent tenant. A solid recommendation, even from a real estate agent on the other side of the world, can bolster your tenancy chances.

When you leave the U.S. to live in a different country, it’s natural to feel disoriented, overwhelmed, lonely and confused when you try to adapt to a new culture. If you stay overseas long enough, you could experience similar feelings of homesickness when you return to America.

Some of the initial costs you should plan ahead for when moving overseas include rental bonds, a new computer, work clothes, maybe buying a car, and a whole range of other potential expenses depending on your needs. Working out a rough idea of these costs ahead of time can help you ensure that you have enough funds available.

The cost involved in shipping items overseas can be a great motivator to help you decide what you really need to take with you and what can be left behind. Be ruthless with your culling and leave as many bulky items behind as possible – it will save you a sizable amount of money.

You’ll need to get in touch with your provider to diagnose the problem. In most cases your account may have been closed due to activity. If calling your provider is not an option, in most cases they will provide an online enquiry form.

This decision is entirely up to you. If you would like to relocate overseas to take advantage of lower tax thresholds and the lower cost of living, then this could be an option for you.

The response to this will depend on your current financial and personal situation. You’ll need to see a financial adviser or planner to see if you have enough for a ‘comfortable’ retirement overseas.

Generally you can still get a credit card if you’re on a temporary or working Visa in that country. Speak to your local bank to discuss your eligibility or options.

Most banks will let you open a bank account before you arrive in the country. You can approach an international bank such as HSBC or Citibank to open an account issued by the country that you’re traveling to. This can be done over the phone or visiting your local branch.

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