Thinking About Moving Abroad? Important Financial Steps to Take Before You Go

It’s not uncommon for U.S. citizens to dream of living abroad, and with shifting political winds at home, we’re hearing more and more clients talk seriously about making the move. Whether you're chasing adventure, lower costs, or just a slower pace of life, there are important financial (and logistical) things to think through before you make the leap.

Below, we’ll share some key considerations to help you prepare for a successful transition to life outside the U.S.

1. Visa & Residency Requirements

Before you buy a plane ticket, get clear on the rules. Every country has its own visa and residency requirements. Some offer generous tourist visas, while others require specific income thresholds, proof of employment, or retirement savings to apply for long-term stays.

• For example: Mexico allows a 6-month tourist visa for most foreigners — you can stay for 180 days, then simply leave and re-enter to renew. Portugal, another popular destination, is part of the EU and offers various types of residency visas, including the D7 visa for retirees and remote workers.

Don’t assume you can show up and stay indefinitely — do your research ahead of time to avoid surprises, and to ensure you have the correct paperwork and approvals.

2. Understand Currency Risk

When your life is in one country but your money is in another, exchange rates matter — a lot. Currency fluctuations can impact your spending power, investment returns, and long-term savings plans.

Consider:

• Keeping an emergency fund in both currencies

• Using a multi-currency bank or fintech platform to reduce conversion costs

• Factoring exchange rate changes into your budget

Some U.S. banks and credit cards will take care of this conversion for you, with or without fees, when you make charges using your card. In general, it’s best to look into the policies for each of the financial institutions you work with to ensure you know all the details!

3. Foreign Income & Business Rule

Planning to earn income abroad via activities like renting out property, freelancing, or running a business? Know the rules. Each country has different tax codes, business registration processes, and reporting requirements.

• Example: In Portugal, you need an NIF (Número de Identificação Fiscal) to buy property or open a local bank account

Even if you don’t plan to work abroad, understanding local tax systems can help you avoid penalties and stay compliant.

4. U.S. Taxes Still Apply

It’s important to remember that living outside the U.S. doesn’t mean you’re off the hook for U.S. taxes. In most cases, American citizens are still required to file annually with the IRS, and may owe taxes on worldwide income.

This is especially true if you:

• Draw from retirement accounts

• Receive Social Security or pension income

• Sell U.S. property or investments

There are certain exclusions and tax treaties that might reduce or eliminate your foreign income tax burden, but these are the exception, not the rule. It’s best to work with a qualified tax professional who is familiar with regulations applicable to U.S. citizens living abroad to avoid issues.

5. Automate U.S. Based Obligations

Don’t let your mail — or your credit — pile up while you’re gone. It’s a good idea to automate payments for any ongoing financial obligations in the U.S., such as:

• Life insurance premiums

• Property taxes

• Mortgage or HOA dues

• Car registration

• Utility bills

• Student loans

• Debt payments

A missed payment can snowball fast, especially when you're a few time zones away. Consider setting up online accounts and paperless billing, and maybe even appointing a trusted contact or financial advisor stateside to help monitor things if needed.

6. Budget for a New Lifestyle

The cost of living abroad may be higher or lower than what you're used to; it all depends on the country, city, and lifestyle you choose. Be sure to do your research on factors like:

• Housing and rent

• Utilities

• Food and groceries

• Healthcare (very important!)

• Transportation

• Local taxes and fees

Additionally, don’t forget to include travel back to the U.S. in your budget and planning! If you plan to visit friends and family annually or more often, be sure to factor in airfare, accommodations, and any travel insurance needs.

7. Healthcare Access & Insurance

U.S. health insurance typically won’t cover you abroad. To help ensure you remain covered, it’s good to look into:

• Local healthcare systems — some countries offer public healthcare for residents

• Private international health insurance plans

• Travel insurance with medical coverage for shorter stays or transitional periods

Whether you're retiring abroad or just traveling long-term, it’s important to verify that you can access healthcare affordably and understand how pre-existing conditions may be treated.

8. Estate Planning & Legal Docs

Another important consideration is that your U.S. will and power of attorney may not hold up abroad. Before moving it’s good to review and, if necessary, make updates to your:

• Estate planning documents

• Beneficiary designations

• Health care directive

Depending on your destination you might also need to create or notarize local versions of key documents, so be sure to research and plan ahead of time to allow plenty of wiggle room to get this taken care of, if needed.

9. Banking & Access to Funds

Opening a local bank account can make life easier, but you may still need access to your U.S. accounts. To make things easier, consider:

• International-friendly banks with global access

• Fintech options like Wise, Revolut, or Charles Schwab (which reimburses ATM fees)

• Keeping some cash in both currencies

Also, be aware of FATCA (the Foreign Account Tax Compliance Act), which requires U.S. citizens to report foreign bank accounts once balances exceed certain thresholds.

The Bottom Line on Preparing Your Finances for Living Abroad

Moving abroad can be exciting and empowering, but it also comes with responsibilities. Planning ahead can help you avoid costly mistakes and set you up for a smoother, more enjoyable experience. When in doubt, consult with a financial advisor who understands international planning and can guide you through the nuances! 

Wondering about this or other aspects of your financial picture? We’re here to help!