A few things to consider before becoming an expatriate
There are plenty of possible reasons you could want to leave the U.S. Perhaps you've always dreamed about making the sand and surf your front yard or longed to master a foreign tongue. Maybe you've been offered a job abroad. Maybe you feel your taxes are too high. I'm not here to question your motives, traveler. I'm just here to pass along what I know and help you get to your new home with your personal finances in order.
Settling Your Accounts
You're going to need a bank account when you first land on that once-foreign soil. Common expat advice is to set up an online savings account before leaving. Start out by keeping your money with a well-established and nationally available bank — at least until you get a good sense of the banking landscape in your new home.
Be aware, though: If you're still a U.S. citizen while living abroad and ever wind up with more than $10,000 in your new accounts, you'll need to file a Report of Foreign Bank and Financial Accounts with the stateside IRS. You can be hit with serious penalties for neglecting to do this, so do the paperwork or renounce citizenship before you start making any serious money.
Speaking of that, renunciation of citizenship is a big decision. So don't be too hasty to close all of your stateside savings, checking or credit accounts. Should the U.S. ever beckon you back, a history of moderate financial activity may make it easier to re-establish yourself back home.
But if you really want nothing to do with the U.S., for now and for always, then you probably don't need to worry much about your stateside fiscal agility. In that case, just do what paperwork you have to while you establish residency and take the citizenship plunge only when you're ready.
Getting Your House in Order
A friend of mine who split for other hemispheres had no property in her name when she left, so she had little to worry about in this respect. But it's important that you pay special attention to the rules of your tax domicile if you intend to keep any real estate in the U.S.
If you plan to rent out a house you own, for instance, you're likely to stay on the tax rolls even if you never set foot on U.S. soil. Laws and codes can differ widely from state to state, so make sure to take full measure of your obligations if you're going to retain a home or property in the U.S.
Note: Please remember that nothing said in this article constitutes professional tax advice. The official position of this author is that you should speak with at least two experts on the tax code before making any decisions, ever.
Currency, Taxes and Investments
If you sell a house, stocks, bonds or even a car, you may take a substantial amount of currency with you when you move abroad. My expat friend did this in the form of a fat roll of cold, hard American cash, which is not the most highly recommended method of wealth transfer.
Besides being incredibly vulnerable to loss and theft, the wad-of-bills method subjects you to the rude whims of whatever local currency exchange you happen to encounter. Electronic currency transfer services like Canada's XE can often help you get a favorable conversion rate on your money, and tend to be more secure (and more comfortable) than strapping a full wallet to your upper leg.
You'll have to earn money after you settle in, of course, and there's a chance that stateside tax collectors might want a piece of that if you're still a citizen here. Become familiar with the Foreign-Earned Income Exclusion (FEIE) rules while you're still a U.S. citizen. As of 2012, it can qualify expatriates for a tax exemption on up to $95,100 of income earned overseas.
In terms of investment funds, you may find it easiest to leave them back home. Most investments can be monitored and managed from anywhere with a connection to the Internet. Moreover, you might be hit with fees on each end of the deal if you move your investment money to an offshore broker.
Ultimately, if your taxes in the U.S. are already complicated by investment gains and other holdings, you probably already have some tax law pros on speed dial. Check with them about what relocating abroad could mean for your taxes before you make any decisions.
All the Other Things
If you haven't already worked out your plan for obtaining legal residence or gainful employment in your new home, there are plenty of other resources available. Questions about work permits, resident papers and citizenship details (should you choose to abandon the U.S. all together) are questions best directed toward emigration experts or expats themselves.
Though she's spent eight years abroad and has no domicile here in the States, my expat friend does maintain citizenship here, as she says it makes travel easier. She doesn't invest, though, and her translator's income is far from the FEIE cap, so your perspective on retaining U.S. citizenship may vary.
However you choose to handle your wanderlust/political ire/employment/retirement, think carefully before you make any drastic decisions to relocate. Becoming an expat might require more legwork than you think, so make sure you're really ready for a change before you pull up your stakes.
Would you ever consider becoming an expatriate? What would be your motive for moving? Where would you go? Are you already an expat? If so, what was your experience getting settled abroad?