Moving to Europe as an American changes almost every facet of your financial life. Banking, investing, insurance, estate planning, and retirement strategy all become more convoluted once your finances reach across multiple countries.
A financial advisor in the US or a local advisor in your country of residence only understands one side of that picture. A cross-border financial advisor, on the other hand, has the expertise and experience to ensure you remain compliant and tax optimized across both jurisdictions.
Understanding your obligations on both sides
As a US citizen, you remain subject to US reporting obligations regardless of where you live, including filing requirements, retirement account rules, foreign asset disclosures, and more. At the same time, if you’re a tax resident in Europe, you’ll have local taxes to pay and be subject to a different regulatory regime (or two, both EU-wide rules and the rules in your country of residence). Many Americans in Europe assume that tax treaties solve everything, but unfortunately, this isn’t the case.
Most financial advisors are trained and licensed to operate in a single country. A cross-border advisor who specializes in Americans in Europe understands both systems and, most importantly, how they interact. That dual fluency enables them to give advice that works for your situation, rather than advice optimized for one jurisdiction that is likely to create unintended consequences in the other.
Helping you access the right investment products
Investing as a US expat can be extremely difficult due to cross-border compliance rules. Most US brokerage firms won’t serve non-residents, and many European brokers won’t work with US clients. EU-domiciled ETFs can also carry reporting burdens and trigger high taxes for US citizens. Without the right advisor, expats can get locked out of their existing US portfolios, or invested in products that create complications.
Cross-border financial advisors who work with Americans in Europe typically have relationships with custodians and investment platforms that support Americans living overseas. They also know how to build diversified, cost-efficient portfolios with international and European exposure, using US-domiciled structures to keep your financial life clean and compliant.
Coordinating your cross-border financial plan
Cross-border financial planning involves bringing together lots of different threads, such as for example US (and foreign) retirement and brokerage accounts, foreign bank accounts, local pension entitlements, real estate in multiple countries, currency exposure risk, and insurance coverage that may or may not be valid across borders. Each of these pieces has its own set of rules and decisions, and choices made in one area affect others.
A cross-border advisor’s role is to take everything into account and ensure they all work together in your best interest and towards achieving your financial goals. This might include helping you structure retirement contributions, structuring your income tax efficiently and with minimum currency exchange loss, and reviewing whether your US insurance coverage extends overseas, flagging financial decisions that could create complications on either side, and more.
Knowing what local advisors and US advisors typically miss
A well-meaning US-based financial advisor who hasn’t worked extensively with expats may not realize how living abroad affects their recommendations. They might not know that certain retirement account strategies work differently for non-residents, that some US investment products aren’t available from abroad, or that US accounts may not be kept by non-residents, for example.
On the other hand, a local European financial advisor typically won’t have an understanding of your US obligations and how US rules affect their recommendations. Their recommendations are tailored to European investors, and they may recommend products such as EU-domiciled ETFs or other funds that may be beneficial for their other clients but would be problematic for you.
A cross-border advisor bridges these two worlds and so helps you to avoid costly mistakes.
Growing with your situation
Life as an American in Europe can be unpredictable. You might move between European countries, change employment or your income types, purchase property, receive an inheritance, or eventually plan to return to the US. Each of these transitions has financial implications that can be affected by both jurisdictions.
A trusted cross-border advisor who is already familiar with your finances is well-positioned to help you manage these transitions without starting from scratch each time. The longer they know you and your situation, the better they can predict how these major changes will affect your financial planning and investment strategy.
Cross-border planning with confidence
US expats often wonder whether their accounts are compliant or if their investments are appropriate. That’s why one of the most underrated benefits of working with a cross-border financial advisor is the relief that comes from knowing your finances are in order.
Working with a cross-border advisor gives you a clear, coordinated financial plan that frees you to make better decisions, take appropriate financial risks, and focus on building the life you moved abroad to create.
Final thoughts
For any American living in Europe, a specialist cross-border financial planning service is the most effective way to offset the financial risks Americans experience being subject to two financial and tax environments as well as the effects of currency exchange fluctuations on your income and relative asset values. Many questions arise, and the answers require someone who is familiar with both systems and working with Americans in Europe so they can plan with confidence.
If you have any questions about financial planning or investing as an American living in the EU, get in touch.
This article is for informational purposes only; it is not intended to offer advice or guidance on legal, tax, or investment matters. Such advice can be given only with full understanding of a person’s specific situation.
