How to Get Your Money Out of the US

Sponsored by EuroAmerican Financial Advisors.

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The United States has long been viewed as one of the safest environments for building and holding wealth. However, an increasing number of US expats, especially those who have settled abroad permanently, are asking whether keeping everything in one country is the right long-term strategy.

For some, it’s about currency exposure, for others, it’s political risk, fiscal policy, or simply the desire to diversify more broadly. In most cases, the goal is not to exit the US entirely, but to reduce concentration and create more flexibility.

Moving assets internationally can be a gradual process, adding new jurisdictions, spreading risk, and building a portfolio that is less dependent on one financial system.

In this article, we’ll provide an overview of several ways to achieve this.

US Reporting Considerations

First though, before moving money abroad it’s important to understand that US obligations do not disappear.

American citizens and residents are generally required to report their worldwide income, regardless of where assets are held. In addition, foreign financial accounts must often be disclosed.

These requirements can be detailed and, at times, burdensome. They apply not only to bank accounts, but also to investment holdings.

Failure to comply can result in significant penalties, which makes accurate and timely reporting essential, and working with a US expat tax professional becomes an important part of managing this process. Investing in non-US funds and owning non-US businesses can trigger significant new tax and reporting responsibilities.

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Invest in International ETFs

One of the simplest ways to diversify beyond the US is by investing in US-registered international ETFs.

These ETFs allow investors to gain exposure to foreign markets while keeping their assets within a US brokerage account. In this way, you can hold companies across Europe, Asia, and emerging markets without needing to open new accounts overseas, which can also create new US and local tax implications.

This approach keeps administration simple and avoids many of the reporting challenges that come with holding assets abroad. For investors who want global exposure without additional complexity, it can be an effective first step.

However, even though the underlying investments are international and provide global diversification, the underlying investments are still in the US, so while you are investing overseas, you aren’t really getting your money out of the US. The funds are still domiciled domestically, held with US custodians, and subject to US regulation.

For investors whose primary concern is diversification across markets, this may be sufficient. But those looking to reduce reliance on the US financial system altogether may need to look at  other options.

There can also be practical constraints. As a retail investor living in the EU, you can’t access US-listed ETFs directly under EU rules, although you can through a cross-border financial advisor who may be able to hold them on your behalf.

Buying Foreign Stocks and Bonds Directly

Conversely, buying EU registered funds creates a US reporting burden and often a new tax implication for Americans. This means that for a more direct form of international exposure, many investors choose to invest directly in foreign stocks and bonds.

The benefit is greater separation, as well as holding investments in the country and currency where you reside.

That said, this route comes with additional responsibilities. Having foreign accounts means reporting them on US FBAR and FATCA forms, although no new tax implications. Additional potential downsides are that non-US accounts typically come with higher fees that can affect long term returns, and that makes it more complex when picking individual stocks and bonds to invest in.

It does however offer a level of control and geographic diversification that simpler strategies cannot replicate.

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Foreign Bank Term Deposits

Holding cash in foreign banks is one of the most straightforward ways to spread assets across jurisdictions. Term deposits, in particular, provide a structured way to do this by offering fixed returns over a defined period.

The appeal of this strategy lies in its simplicity. Funds are placed in a different banking system and often in a different currency, creating a layer of separation from the US financial environment. This can be useful for those who want part of their wealth positioned outside the dollar, and they also provide easy access, typically.

Returns on these deposits are typically modest, but that is not their primary purpose. Instead, they serve as a stabilizing element within a broader portfolio, offering liquidity and a degree of predictability.

As part of a broader strategy, foreign deposits can add a conservative, geographically distinct component to a portfolio.

Investing in International Real Estate

Another way to move assets beyond the US is through property ownership abroad.

International real estate offers a tangible form of diversification, both geographically and in terms of asset class.

This is applied equally if the property is your home, a vacation property, or an investment property such as a rental.

Liquidity is another factor. Property is not easily bought or sold, and transaction costs can be substantial. This makes it less flexible than other forms of investment.

There are also tax implications to consider, both in the country where the property is located and in the US. Rental income, capital gains, and reporting requirements all need to be considered.

Despite these challenges, international real estate can play a meaningful role in diversification, particularly for those looking to anchor part of their wealth in physical assets outside the US.

Other Considerations

Moving assets internationally can also have implications for estate planning, and you’ll typically need a will in each country where you own assets.

For US citizens, estate tax exposure can extend to global assets, while foreign jurisdictions may impose their own inheritance or estate taxes on your global assets. This creates the potential for overlapping obligations, which need to be carefully coordinated, though structuring ownership appropriately can help manage these risks.

These are the main options and considerations for Americans living abroad looking to move their money out of the US. There is no universal solution however, and the right mix depends on your goals, your tolerance for complexity, and how much diversification you are seeking.

Most importantly, your investment decisions should be made in the context of your investment strategy and to help achieve of your long-term financial goals.

Shane Clark, EFP is President of EuroAmerican Financial Advisors and a cross-border financial advisor with over 10 years specializing working with in Americans living in Europe. He resides in Spain.

You can learn more about EuroAmerican Financial Advisors on the website at eurousafa.com, follow on Twitter at @AdvisorsEuro and Facebook at @EuroAmericanFinancialadvisors and connect on LinkedIn.

Sponsored by EuroAmerican Financial Advisors.

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