You need to carefully manage your financial life when you live or retire in another country. In some cases you can do this virtually, with the support of a laptop and an internet connection. This way, you can access an account, get cash, move money, send a wire or pay a bill from anywhere in the world.
You want your critical financial functions to be hassle-free, not a distraction that gets in the way of having fun in your new life in your chosen country. You also want to avoid late fees and to minimize the costs associated with accessing and using your own money via ATMs and credit cards.
In the past, managing bank, investment and retirement accounts and paying credit card bills while living overseas was a real challenge. New technologies have made coordinating your financial life while living in a foreign country easier, but there’s still a to-do list.
[See: 10 Places to Retire Overseas in 2017.]
Establishing the necessary financial management infrastructure is key to your success living, retired or investing abroad. Here are seven practical recommendations to manage your financial life overseas:
1. Put all the pieces in place before you move. It’s more complicated to set up financial systems if you wait until after you’ve already left home. For example, some banks require the use of security tokens (or fobs), sometimes virtual or physical, when sending a wire. If your bank requires a physical token, you’ll need to take possession of it somehow. The easiest way is to go to the bank and pick it up.
If you’re already living in another country when you realize you need a physical fob to make a wire transfer, you aren’t going to want to make a special trip back to your home country to visit your bank to collect it. The alternative would be to ask your bank to mail the fob to you. However, if your bank is in the United States, it’s likely only going to agree to mail it to a U.S. address, so you’ll still have to figure out how to get it to wherever you’re living.
2. Set up online accounts. You want to be able to manage all aspects of your financial life online, so set up all online access and management systems before you leave home and test them. If your bank or brokerage house doesn’t offer you the ability to accomplish tasks online, it’s better to find that out before you’re living a thousand miles away.
3. Find a way to pay bills remotely. Make sure that your bank will allow you to move money from one account to another, especially if one of those accounts is in another country. You also need to be able to pay bills remotely and electronically. If you can’t do this, you need a new bank.
[See: 10 Tips for Finding a Great Place to Retire.]
4. Create multiple bank accounts. If you have one current bank account in your home country, consider opening a second. This should give you more options for executing online transactions. Having debit cards from two banks will come in handy if one of them gets cut off while you’re overseas. You should also set up at least two credit cards before making your move so you have options if one doesn’t work overseas.
5. Figure out how to avoid fees. Look for a bank that doesn’t charge a fee when you use another financial institution’s ATM machine. Some banks will also credit you when you are charged a fee by another bank.
6. Look into wire transfers. One of the biggest money-related challenges you’re likely to encounter has to do with wiring money across international borders. Many banks still require you to show up in their offices to present wire instructions. But it’s increasingly possible to initiate wires by phone or online using either a security token or a series of passwords. This is another deal-breaker. If your bank won’t allow you to initiate international wires unless you show up at a branch in person, you need a new bank. How are you going to stop in the office of your bank in Des Moines to approve a wire transfer if you’re living in Buenos Aires?
[See: The Top Travel Destinations for Retirees.]
7. Consider how you will exchange currency. If you’ll be moving to a country that doesn’t use the U.S. dollar and you aren’t able to open a local bank account in U.S. dollars, consider setting up an account with an online foreign exchange company. You’ll be able to save on wire fees, and you’ll get a better exchange rate on each transfer you make.
Kathleen Peddicord is the founder of the Live and Invest Overseas publishing group.
More from U.S. News
10 Ways to Get Ready for Retirement After Age 50
13 States Without Pension or Social Security Taxes
10 Costs You Can Eliminate in Retirement
7 Tips for Managing Your Financial Affairs as a Retiree Overseas originally appeared on usnews.com
