Advice for my naturalized wife if she moves back to Philippines when I pass away.

[dvensel1 9]

Hi and many Thanks.  I hadn't considered the tax part of this.  My wife is really not sure she would move back, so I'm trying to cover both scenarios.  Others have stated that keeping the accounts in the USA is better for the rates.  I agree.  So does my wife.   She seems to think she'd be fine, but I worry about her.  She will continue to get my social security and a pension I receive from NY state employment for 28½ years.   If she moved back to Philippines, she surely would be financially secure - as long as nothing interfered with money transfers of course.  If she took a debit card, it would be hard to renew it after it ages out.  Some suggested I set someone up who can handle things when a new debit card is sent to them and then they can activate it and Fed Ex it to her.  OR, another suggested opening a bank account in Philippines and simply transfer funds via wire.  That way the deposits (from my retirements) would remain in place and it would simply be a bank transfer.

Thanks so  much for your input!   I appreciate it.  You gave me a few ideas too.

 

Doug V.

 

[spicynujac 100]

What is the source of your retirement money?  It is VERY common for Americans to retire abroad and have their social security checks deposited to foreign bank accounts.  

If it is your own account, like an Individual Retirement Account (IRA) then there are also easy ways of redirecting the funds.

If you receive a check from a company or other entity, then I don't know the answer without more details. 

 

My first and biggest question to anyone facing this would be think VERY carefully about what citizenship you want in the future... My wife is in her 20s and we are already not sure if she will be applying for US citizenship (that decision is years away for us) but if one KNEW they would be leaving the US, US citizenship imposes worldwide taxation on all income (only the African nation of Eritrea does this) and has onerous reporting requirements, and basically the only benefit she gets is easy and free entry to the US if she wanted to visit, and I suppose the ability to sponsor others for US citizenship.  For us, having permanent residency is the best thing until we know for sure where we will be in future decades.

 

But you've already crossed that bridge.

If you have any accounts at major banks or investment firms (Schwab, Fidelity, Vanguard, etc.) I would talk to them.  There can be a lot of factors that make your question not so simple to answer over a forum, and you might be leaving out important details or not providing the full information needed.  

 

Also, I heard anecdotally (unconfirmed), that while my wife, a Filipino citizen who is has permanent residency in the USA, can buy property today in the Philippines, once she becomes a US citizen she CANNOT, as she loses that status until she completes the requirements for dual Filipino citizenship.  So for anyone looking at this, it might be advantageous to purchase the property BEFORE US citizenship is granted, which is what we will do (you don't lose the property if you later alter your citizenship--it remains titled in the legal owners name).

 

Again, I would caveat talking to a financial professional, estate planner, lawyer with some international experience, or at least someone at the bank or finance company you trust (an estate lawyer I use charges $200 an hour which is cheap for some good information), but as a GENERAL rule, the larger the institution, the easier it will be to do this type of thing.  For example, I have free international wire transfers from Fidelity and free cash withdrawals worldwide through Schwab.  Sadly I don't know of any banks that operate in both the US and Philippines--it is mostly other Asian firms over there, like HSBC, etc.  That would make things much simpler.

[dvensel1 9]

Thank You very much. You helped me out a bit more.  The property thing was an issue for her so it was nice to learn that it is unaffected by her new citizenship.  She was worried.

 

Thank You again.

 

Doug V.

 

Edited yesterday at 12:31 AM by dvensel1

[spicynujac 100]

3 minutes ago, dvensel1 said:

 my social security and a pension I receive from NY state employment for 28½ years. 

 

Why don't you contact someone at the NY retirement office?  There are LOT of foreigners living in NY and I'm sure they have come across this situation before.

 

I'd be careful of relying on US companies as a permanent bank when you are not in the US.   The benefits I mentioned above are meant for US citizens traveling abroad as a courtesy and benefit to gain their business, and are not meant to be daily banking solutions for foreigners living anywhere in the world.

I feel pretty sure if I withdrew cash at Filipino ATMS a couple hundred times over a year, that that benefit would soon be cut from my account and I would be told to open a bank account in the country where I live.  A local bank account is a must.  And perhaps the funds can be sent there, or perhaps you must deposit them in a US bank first.

 

To clarify about the property, your wife (IF what I heard is correct) CANNOT buy property now, UNTIL she gets dual citizenship issued by the Philippine authorities.  She could have bought property freely before getting the US citizenship.  

[dvensel1 9]

She owned property prior to her citizenship.  I think she's all right.  In fact, I suggested she sign it over to her son and DIL who now live in the house we repaired after the 2013 quake destroyed it.  They have 3 little girls too.  So, she's thinking of signing it over to them when we go back next March or so. 

I think bank transfers are the way to go too.  I worry about a debit card failing of breaking, plus not to mention aging out after every 5 years.  She have to have someone in the states act on her behalf to activate the new replacement card and fed ex it to her (not cheap to do either).  Bank transfers are so much better.  What do you think?

 

Doug V

 

[spicynujac 100]

Bank transfers sound like a good idea.

By the way, make sure your wife is listed as your beneficiary on every account at every institution.

If not, it could cause big problems with her getting access to the money.  There are even cases where a divorced spouse gets the money and the current spouse gets NOTHING because the account owner thought the wife just automatically got his money when he died.. NOPE!