Tips on managing your money from abroad

Depending on whether you are moving for good or just getting a holiday home there will be a number of things you need to check you are complying with if you are out of the country for long periods. This is by no means an exhaustive list but should help point you in the right direction. You wouldn’t get your bank manager to fix your plumbing so why ask a plumber “down the pub” about your finances! Its worth seeking out professional help to service your finances even if you aren’t moving abroad. IFA’s and other financial advisers manage money every day so mere mortals like us can’t hope to be as good at it as they are. You can find plenty of companies online to have a look at the services available.

I know a lot of friends who “object” to paying for financial advice which is crazy! They will happily pay some bloke with some spanners to service their car because he knows what he’s doing. But when it comes to paying a qualified financial adviser who you can check is regulated by the FSA, has certificates for qualifications like CeFA, FPC, CeMAP, CeRGI…. Not a chance! Paying someone to service your finances which probably includes a mortgage for many thousands and will hopefully include your pensions and maybe some life insurance should be an obvious decision. Service your car yourself if you have to choose between who to pay. The car will be in the scrap yard in 10 years anyway, your pension has to last for decades. Get the car wrong and you’ll be getting a bus for a couple of days. Get the pension wrong and you could be getting the bus for good.

Income Tax

One of the first things to check out is whether you will be a uk resident for tax purposes. If not then you may be able to claim back some income tax by filling in a P85 form which you can get from the HM Revenues and Customs website. You’ll also need to see if you are going to have to start paying tax in the new country!

Investments

If you have long standing investments such as ISA’s, Life Endowments, Mortgages, Pensions and so on, you will need to look at each of them in great details as these things are your future and worth getting right. Life Insurance policies will also need to be looked at to check if the life insurance provides cover if you are not living in Bulgaria or an expat anywhere.

Mortgages

Mortgages and buy-to-let mortgages will need to be reviewed for a number of reasons. Firstly, you will have to declare buy to let income to the tax authorities so you need to know where you stand in terms of having the correct documents from the lenders, tenants and so on. If you are moving out of your current mortgaged property but planning on letting it out you will need to tell your current lender. This can be fairly straight forward and some let you keep your existing mortgage rate however you may need to remortgage to a buy-to-let mortgage if the lender gets funny.

Buy to let properties

If you do have buy to lets you will need to consider who is going to manage your portfolio if you are in a different country. Its all very well having a trusted friend making sure the rent gets paid but what happens if the boiler blows? Or the bathroom floor caves in? It may be worth talking to a professional property manager to see what their prices are like. You can usually get quotes online with no obligation so that you can compare the service and fees.

Portfolios

If you have a complex portfolio of investments, pensions, stocks and shares the chances are you already have an Independent Financial Advisor (IFA) managing your money. Something we have found a lot is that lots of people had an IFA set things up for them 3 or 4 years ago but he/she hasn’t reviewed things in the last 6 months. That is MENTAL! If you have a personal pension or other investments they need to be watched like a hawk all of the time. Most decent IFA’s will review your position every 6 months with your approval. A good example of why you need to do this is the recent “credit crunch”. If you had/have investments which are tied to commercial property, the chances are the value has fallen substantially in the last year. An IFA would be able to keep you up to date with the situation and what it means to you and fix potential problems before they get out of hand.

Whatever you do, don’t worry about it, sort it.