Expat Financial Planning, made easy

Well, you should.

Financial planning allows you to protect and pass on your wealth through savings and investment, pension planning, tax planning, insurance, estate, and family law planning.

As an expat, all this can become a little more difficult and complex, but it’s crucial to create a structured plan. So where to start?

We spoke with Shaun Armstrong of Blacktower Financial Management Interational– himself an expat living in Sweden - to find out the basics.

Pension planning

As expats move to different countries and different companies, pensions become scattered all over the place.

“It can be difficult to develop a clear retirement strategy, as many people don’t understand the pension systems they are a part of and pension systems were not designed for expatriates,” Armstrong explains.

For people who’ve lived or worked in the UK, one option is the Qualified Recognised Overseas Pension Scheme (QROPS).

“QROPS allows you to transfer your pension out of the UK into a currency of your choice free of UK taxation. I would also strongly recommend developing your own pension savings plan in the currency and jurisdiction of your choice,” he explains.

Tax Planning

Tax planning is an arduous chore, but it remains important and indeed necessary, in no small part due to the Common Reporting Standard.

“The Common Reporting Standard is an international agreement that requires banks and financial institutions to report their international account holders to the tax authorities,” Shaun tells The Local.

This means that, more than ever, expatriates need to give careful consideration to where and how they place their funds and their tax reporting obligations.

“You may also still be liable for taxes from your home country such as the Inheritance Tax (IHT) for UK citizens,” Armstrong explains.

“IHT is levied on your worldwide assets - including perhaps the family home you own with your Swedish partner. And US citizens are faced with many difficulties arising from the Foreign Account Tax Compliance Act (FATCA).”

So, it’s important to think about where and how you place your funds, according to Armstrong, and to keep an eye on your tax obligations.

“Otherwise you could end up in trouble,” he says.

Estate and family law planning

Estate and family law planning can be a complicated and sensitive topic. And while divorce or death may not be enjoyable topics of conversation, addressing them is important if you want to protect your wealth and ensure it goes to the right people.

“Expat families will often have members born in different countries, which can make estate and family law planning a little more complex,” Armstrong explains.

Any number of scenarios can become more complicated with family connections across national borders: family members in your home country who you want to protect from negative scenarios or who you want to receive part of your wealth; receiving an inheritance as an expat; or wanting to sell a property back home.

Expats often find it’s hard to get the help they need from local Swedish banks, usually because Swedish banks aren’t trained accordingly, Armstrong explains. They lack the right products, knowledge, or experience.

“Luckily, global financial services giant Old Mutual International (OMI), has designed a special investment account written in both Swedish and English, called The Swedish Executive Portfolio (SEP),” he says.

“The SEP is known as ‘Kapitalförsäkring’ here in Sweden; it’s tax efficient, and available in Swedish kronor, or 15 other major global currencies,” he explains.

Old Mutual International also simplifies tax reporting by providing a tax report to Skatteverket, the Swedish tax authority.

Domiciled in Ireland but globally portable, the SEP is also useful for Inheritance Tax planning, QROPS pension transfers, estate and family law planning and managing investment portfolios.

Still confused, or want to learn more?

Shaun Armstrong will be holding a series of seminars regarding expat financial planning in Gothenburg during June and July. Attendees will be versed on planning strategies and the many different sorts of solutions that are available.

For more information, please contact:

Shaun Armstrong

Regional Manager Sweden
Email: [email protected]
Tel: (+46) (0)73 545 9818
Address: Stureplan 4C, Level 4 Stockholm
Website: www.blacktowerfm.com

*The above information was correct at the time of preparation and does not constitute investment advice. You should seek advice from a professional adviser before embarking on any financial planning activity.

Blacktower Financial Management (International) Limited is licensed by the Gibraltar Financial Services Commission. Licence Number 00805B.