Join us for a fireside chat in which Dunhill Financial and Black Swan Capital discuss tax retirement planning for Americans living abroad.

Topics discussed include:

– How do IRAs for US expats work?
– Retiring in Germany/Netherlands versus retiring back to the USA or in other countries with more favourable taxation treaties.
– Taxation of US retirement plans
– Traditional vs Roth IRAs?
– Netherlands/Germany Specific Nuances (30% Ruling / Wealth Tax)
– German/Dutch Pensions for US Expats
– Other Key Financial Planning considerations for Expats in Netherlands/Germany

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Anya Berezow is a Certified Financial Planner™ at Dunhill Financial with over a decade of experience in the investment/banking industry. As an American Expatriate herself, she enjoys assisting other Americans who made their home outside of the US.

Anya’s goal is to simplify the financial planning process while addressing all aspects of investments, tax planning, risk management, retirement, and estate planning.

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David Bellingham, is CEO and a Director of Black Swan Capital. He has been advising international clients and heading up financial services businesses for over 20 years across 3 continents since he commenced as a financial adviser in the 1990s.

He has a Bachelor of Applied Science, a Master of Business Administration, a Diploma in Financial Planning and a Graduate Diploma in Certified Financial Planning. He is a member of The Chartered Institute for Securities & Investment.

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retirement planning is a critical aspect of financial wellbeing, regardless of where you live. For expatriates residing in Germany or the Netherlands, understanding the local regulations and options available for retirement savings is essential. In this article, we will delve into Individual Retirement Accounts (IRAs) and US qualified plans accessible to expats in Germany and the Netherlands.

Individual Retirement Accounts (IRAs):

IRAs are tax-advantaged retirement savings accounts available to US citizens and resident aliens. These accounts offer the flexibility to choose investments such as stocks, bonds, mutual funds, and more. Expats should be aware that contributions to IRAs must be made with earned income, which typically includes salary, wages, tips, commissions, or self-employment income.

In Germany, expatriates can contribute to traditional IRAs and Roth IRAs. Contributions to traditional IRAs may be tax-deductible, subject to certain income limits and conditions. The earnings within the account grow on a tax-deferred basis, meaning you won’t pay taxes until you withdraw funds during retirement. However, keep in mind that these withdrawals will be subject to income tax.

Roth IRAs, on the other hand, utilize after-tax dollars for contributions, allowing tax-free growth and tax-free withdrawals during retirement. This can be advantageous if you anticipate being in a higher tax bracket during retirement. It’s worth mentioning that if you’re a high-income earner, there may be restrictions on eligibility to contribute to a Roth IRA in the US.

In the Netherlands, expatriates may not be able to directly contribute to an IRA due to the country’s different retirement savings system. However, existing IRAs from previous employment can be maintained and continue to grow tax-deferred. Expats can explore alternative retirement savings options available within the Netherlands, such as employee pension plans offered by their employers or personal savings arrangements like life annuities or bank savings.

US Qualified Plans:

For expatriates working for American companies or those offering US qualified retirement plans, these plans can provide valuable retirement benefits. These plans include 401(k)s, 403(b)s, and other employer-sponsored retirement savings accounts.

In Germany, some US companies provide their employees access to US qualified retirement plans, allowing expats to contribute a portion of their income to these accounts on a pre-tax basis. The contributions reduce the individual’s current taxable income, the earnings grow tax-deferred, and distributions during retirement are subject to income tax. However, keep in mind that these plans may come with specific rules, restrictions, and withdrawal penalties.

In the Netherlands, access to US qualified retirement plans may be limited as the Dutch pension system generally follows a different structure. Expats employed by American companies should consult with their employer’s HR department or retirement plan administrator to understand the possibility of participating in US qualified plans and any associated benefits or limitations.

Seek Professional Guidance:

Navigating retirement planning as an expat can be complex, with variations in local regulations and cross-border implications. Consulting with a professional financial advisor is crucial to help you determine the optimal approach for accumulating retirement savings and minimizing your tax obligations.

They can provide personalized guidance based on your specific circumstances and objectives, ensuring compliance with local regulations while maximizing opportunities for a comfortable retirement. Additionally, professional advisors can assist with managing potential tax liabilities and helping you make informed investment decisions.

Remember, planning for retirement is a long-term endeavor, and making the right choices early on can significantly impact the quality of your future. Take the necessary steps today to secure a financially stable retirement, even while living abroad.