BY JENNY JUDD & LOTTIE LEEFE
We are currently faced with threats to our global economy and the safety of our loved ones. Priorities and routines have adjusted, and with a little planning now and a precautionary overview of your current position, you can prepare yourself to take charge of a
situation, which can seem very daunting.
WHAT CAN YOU DO TO PROTECT YOUR FINANCIAL LIFE?
It’s important to have a comfortable level of cash as an ‘emergency’ fund, and money set aside for your short-term plans. At a time when so many people are faced with a reduced income or challenges with their business, it reinforces some of the core requirements of a solid financial plan. You do not want to be forced to sell your investments at the wrong time.
A FEW THINGS TO CONSIDER
- Hold off on major expenses
- Adjust your non-essential spending
- Pay down expensive debt
- Buffer your savings
- Review your health and life insurance
LOOKING TO THE FUTURE
Once you have the basics in order, take a look at the full picture of all of your global assets, and consider how your different accounts and investments are serving your future goals. These goals are likely to be centered around your:
- charitable giving and longer-term legacy planning
Regularly review your plans to ensure you are on track.
INVESTING AS AN AMERICAN ABROAD
Investing whilst living abroad can be viewed as a ‘no-no’ for US citizens. But that doesn’t mean you have to sacrifice your sanity, or your wealth. Here are a few tips to help you coordinate your strategy:
- Ensure your portfolios don’t contain any PFICs (Passive Foreign Investment Company) funds. The biggest investment in the UK for example are ‘funds’ which are punitively taxed by the US
- On the flip side, if you invest in a non-EU fund not on the UK reporting list, like some US mutual funds, these can be taxed heavily in the UK
- Track any gains or losses from your portfolios for each US and UK tax year. Remember the tax years are different so this can be complex and time consuming for you and your accountant
HAVING A JOINED-UP APPROACH
We often find that our clients have accounts and investments spread across different jurisdictions. It’s likely that your US accounts are looked after by your US domestic adviser (if you have one) and your global assets by another adviser. Along with issues we’ve already mentioned, you may find you are taking too much or too little risk overall, as the whole approach has never been considered fully – just each part of it in isolation. It’s important to take advice from specialists, who understand the pitfalls and can help you organise your global assets. Providing you with a joined-up approach to managing your wealth – and ultimately achieving your