Moving abroad is difficult, not only because you'll be leaving your home for a completely different country, but also because of all of the logistics involved. In between all of your preparations for the actual move, there's also the issue of transferring your money overseas.
If you're moving to another country with a different currency system, your American money is going to need to be exchanged for whatever currency is used in your new country. Before you can do that, you're first going to need to transfer the money that you do have.
Since withdrawing all of the money from your accounts and carrying it over in a suitcase when you travel isn't the safest idea, you're going to need an alternative way to transfer your funds so you won't have to rely on just your credit cards to survive.
Take a look at the following tips on how to transfer your money internationally in an effective way.
Preparing in advance
When moving to a new country, an international money transfer well before your departure will benefit you and allow you enough time to get all of your finances sorted out by the time you arrive. As a rule, you should begin setting up your bank account in the country you're moving to at least a month before your departure. Some overseas banks take longer than others to process international money transfers and may request documents from you as well. Starting this process well ahead of time will ensure that you're not scrambling at the last minute.
If you're not going to be moving overseas permanently, and therefore leaving some of your money in the United States, then you should decide how much money you want to transfer abroad prior to your move. If you still have bills to pay and may have investments in your home country, it helps to prepare all of your documents and make a plan for how much money you'll be taking with you overseas and what will be staying home.
For this scenario, it helps to have two credit cards - one in your home country and a foreign one that you'll use overseas. You should also consult a financial advisor with expertise in international money transfers. He or she can help you make a budget and guide you on how to best manage your money.
Paying taxes
If you are moving overseas, but still remaining a citizen of the United States, you'll still need to file a tax return and pay taxes on your international income, so make sure you know your tax obligations before you move and you discuss them with a tax professional. Chances are, you'll be finding a job in your new country and will also be paying taxes there. It's important to understand the tax situation so you'll be better equipped to deal with it when the time comes.
For this reason, ask your new overseas bank whether you can keep a separate account for U.S. money in addition to your foreign money account. It never hurts to have a supply of money in your home currency in case you ever need it, even while you're overseas.
Additional financial tips for moving overseas
Here are a few other things that you should keep in mind when moving abroad and deciding how you want to transfer your money internationally:
- If you're moving to a country that is less developed and has banking systems that are less stable than the American banking system, make sure you always investigate the bank thoroughly before deciding to open an account. In some smaller underdeveloped nations, the banking systems aren't as secure as others, so be prepared to ask questions and consult with a financial advisor if need be.
- Find out if the foreign bank you'll be opening an account with issues U.S. credit cards like Visa or MasterCard. Also, inquire about whether deposits are guaranteed and, if so, find out who they are guaranteed by.
- Always have a budget. It can be difficult to decide how much money to transfer overseas and how much to keep at home - weigh the decision carefully. Making a budget will help, as you can figure out how much money you'll need to live comfortably in your new country.
- Monitor the financial landscape of the country you are moving to. Some countries are more financially stable than others, and the exchange rates between different currencies can often be dramatic, depending on where you're moving, so be sure to keep an eye on this before you relocate.