Yahoo Finance 8 Financial Tips Before Becoming an Expat
Expatriates, those wanderlust U.S. citizens who pull up stakes and move to another country, seem to be on to something.
Data from the Association of Americans Resident Overseas shows that approximately 8 million Americans lived in foreign lands as of 2015.
[See: 10 Affordable Places to Retire Overseas in 2016.]
According to a recent study by LinkedIn, the vast majority of U.S. expats say they enjoy their new country experiences, with London, Sydney and Toronto high atop the list of countries expats call home.
Now, with a volatile U.S. presidential election still fresh in the rear view mirror, and some Hillary Clinton supporters vowing to move out of the U.S., the question is as relevant as ever -- is the expat life for you?
What are the best countries to move to? "No one answer fits everyone," says Jeff Broadhurst, a technology company chief executive who has moved his family from the U.S. multiple times, living in China and the Czech Republic.
"You need to factor in age, family status, political climate, and level of comfort in exploring new things -- knowing that all will cause great differences in answers. Some people think that moving to the U.K. is stretching their comfort zone and others are comfortable exploring the wonderful people and geography of places like Mongolia, Cambodia and Nepal," Broadhurst says.
"Personally, I would not mind moving to a place like Chiang Mai, Thailand," he says. "There is a decent-sized expat community, great people, good schools for children, very good medical care, low cost of living, warm weather and best of all, excellent food. The chief downside is the rainy season."
How do you handle residency issues? It's different in each country, Broadhurst says.
"The easiest way is to have a good job that the government looks kindly on," he says. "In China for example, if you go there looking for a job, it will be very difficult without skills that are very much in demand. If you go with a job managing a factory, for example, the government envisions you training their people and passing skills along, which is win-win Essentially, most countries want to bring talent and assets into their country and don't want people that will compete with their people for jobs."
Where is English spoken the most in foreign lands? According to a new study by EF Education First, the Netherlands, Denmark, Sweden, Norway, Finland, Singapore, Luxembourg, Austria, Germany and Poland are at the top of the list of "English-friendly" countries. If communicating in English is a big priority, you can't go wrong with any of the these.
Do you have to give up your U.S. citizenship? Not at all, says Abby Eisenkraft chief executive officer at Choice Tax Solutions.
"No, expats don't have to give up their citizenship in order to reside overseas," Eisenkraft says. "However, regardless of where they live, they must continue to file U.S. tax returns, and FBARs (Foreign Account Reports) to report all of their overseas financial accounts and interests.
[See: 7 of the Best Stocks to Buy for 2017.]
What about taxes? The U.S. will grant credit for foreign taxes paid, and in certain cases, foreign earned income can be excluded, Eisenkraft says.
"But one still needs to file in order to get the credit for taxes paid and the exclusion," she says. "Remember, the U.S. has a long reach and agreements with many countries. So tax-wise, there's nothing to hide."
Where should I start? When you've chosen a possible landing spot, go on a tourist visa first, says Matt Antonino, marketing manager at Ultimate Shutter in Victoria, Australia.
"Visit the place you think you want to live," he says. "Live there for 30 to 90 days and use what you learn to make a more informed decision. Too often we make the decision on living abroad from the comfort of home. It definitely isn't for everyone."
What's the best country for getting a tourist visa? John Paul Engel, an expat who has lived in 12 countries, says Japan is at the top of his list for workers coming into the country as tourists.
"In Japan, you just show up and say you're there for vacation. Stay six months, and when your visa is about to expire go to Taiwan or somewhere else and then you can come back and get another six months," Engel says.
"There's also lots of opportunities for employment for foreign workers. Japanese people are very kind to foreigners and many will seek to be your friend. You'll never fully fit in to the society though -- there is no melting pot in Japan. But the key to success as an expat is to learn about the language and culture of your knew home."
What's your best tip on becoming an expat? Don't try to bring a lot of your culture with you, Broadhurst says.
"Accept that each culture does things differently and don't judge which is better," he says. "Get out and immerse yourself in the culture of the country you are living in and enjoy it."
The expat experience may not be for everyone, but if you do have a bit of wanderlust, and if you feel stressed out by petty U.S. partisan politics, maybe a year or more in Japan, Australia, or the Netherlands is just what the doctor ordered.
[Read: 3 Ways to Invest in Skiing and Winter Sports.]
You really won't know until you try.
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