Bonus Episode: Post Election -Thoughts and Mitigating Concerns.
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The 2024 elections are behind us. In this episode, we discuss the aftermath of the US elections, focusing on the concerns of foreign-born clients and US expats.
We explore the uncertainties surrounding immigration laws, visa changes, and the emotional impact of the election results.
Our conversation emphasizes the importance of financial preparedness, including maintaining an emergency fund, being flexible with career plans, and ensuring proper estate planning.
We include practical advice for navigating potential job loss and the complexities of financial planning in uncertain times.
We remind you to lock your credit to protect your identity, especially if you have to leave the U.S.
Episode Links & Resources
Ep 29: Stay A Step Ahead of Cyber Criminals. Protecting Your ID and Other Important Matters.
U.S. Citizenship & Immigration Services - Become a Student of Your Visa
Are you Tax-compliant With Your Overseas Assets? - Free Guide - Scroll to the bottom of the page.
The speakers' views and opinions discussed in this episode should not be considered financial, tax, or legal advice. Consult your advisor for any legal, cross-border tax, and financial advice.
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Speaker 1 (00:00):
Welcome to the International Money Cafe Podcast where we filter out the noise on cross-border taxes, finances, and life in the U.S. I'm your host Jen, me from CFP.
Speaker 2 (00:11):
I'm your host, man, nade ea, to join us on this journey as we explore the unique challenges faced by inbound outbound families and businesses on taxes, compliance, and financial planning. Now onto the show,
Post-Election Stress and How to Cope
Speaker 1 (00:33):
We are back with a very special episode of the International Money Cafe podcast. In today's episode, it's less than a week after the 2024 US elections, and so we want to briefly talk about or do a post-election analysis. And part of the reason for us wanting to do this is so we can really talk about what we can control and what we cannot control. The reason we are doing this, because we've had from a lot of our clients who are experiencing some type of post-election stress and the clients we're talking about are US foreign born clients in the US as well as US experts overseas. And I think a big part of this is really maybe some of the promises Manana said, you know what I'm talking about?
Immigration Law Changes
Speaker 3 (01:33):
Yeah, I know. I think you're right. A lot of the stresses around election promises around taxes and maybe also uncertainty around immigration law changes at this point at least because it's really difficult to say if those promises can and will be implemented to not sound presumptuous. Jane and I have lived experiences. We have been here for many years in the US and we have navigated many changes to our American dreams. Acknowledging though that this election is unprecedented in terms of the issues that are at stake. There are of course the promises. Again, the tick jar is going to expire on December 31st, 2025. So there's a whole lot of tax provisions that will or might change starting January 1st of 26. So that's where we are at Jane.
Moving Forward After the Election
Speaker 1 (02:43):
Yeah, and so one of the things, I actually made a post this morning on LinkedIn and the first thing I said is let's all take a deep breath. The one good thing is at least we won't see all these political ads anymore, but I also want to say it's okay to mourn and grieve if the results are not really what you expected. The unfortunate thing about elections at any point is half of the group is going to be very unhappy. The other group is going to be very happy, I guess. So if it didn't go your way, I think it's okay to take a few moments more on grief if this is not what you expected. But more importantly, what we want to do today is talk about what we can control. What do we do now? How do we move forward? How do we ensure that we can continue leaving our American dream?
Impact of the Election on Different Groups
Speaker 1 (03:37):
And so when I talk about the impact of the election, I'm talking about, let's say the specific groups I'm addressing is one non-immigrant visa holders with non-legal immigration is likely to be tough, and we'll talk about that. We are also talking about people who are outside the US who were thinking of moving to the US and then of course we are also talking about US citizens and green cut holders who were abroad, who were outside. And again, we know there are things that are going to come out of this mana. So when you think about legal immigration and what we are hearing from immigration lawyers, what are some of the specifics that you've seen or had immigration lawyers talk about?
What are Immigration Lawyers Saying?
Speaker 3 (04:20):
Some of the specifics that they're talking about at this point is there could be a reduction in visas for F1, which is this student. As you know, the STEM OPT might be also affected under the F1 visa and there could be more stringent rules for CPT. The other visas that we are hearing about are the H one B visas, and these are work visas as you know. Again, these may go through more scrutiny by the Department of labor. It could be possible from what we are hearing that H four spouse visas may go back to not being able to work. So there is another visa that we are hearing about from immigration attorneys is the L one visa, which are usually given by multinational companies to their employees who move over to the US and there could be a possible change there. It could also again be possible here that L two visas, which are spouse or dependent visas, may not be able to work. Jane, that's the buzz.
Non-Immigrant Work Visa and Losing your Job
Speaker 1 (05:37):
Right? And so again, we don't know what's going to happen. All we can do is sort of sit back and wait, but the one thing we can control, and we actually have a full episode on this, we've talked a lot about if you are on a non-immigrant work visa, the biggest threat to your plan is you losing the job. Because as we've talked about, when you lose a job on a non-immigrant visa, and in this case I'm referring to H one, L one, L one E three T and all those visas, what typically happens is you have up to 60 days where you have to leave the country if you haven't found something else. Talking with immigration lawyers, one of the pieces of advice we've always received from them in the past is it may be possible to switch to another visa. In this case it could be like the F1 visa, the student visa, which of course means you have to go through the whole process of applying and being accepted by a school or you could switch to a B one student visa. Now what they're saying, there's a possibility that you may not be able to make that switch, which means the chances of when you've lost a job and having to leave the country are likely to go up a little bit. But again, it's speculation, but what can we do to prepare ourselves for that eventuality? So
Be Flexible with Your American Dream
Speaker 1 (07:11):
One of the takeaways is take a deep breath, accept the results, and like I said, it's okay to grieve, but I think there are things we can do. I am telling my clients, and we talked about this before we started the recording, the podcast, it's possible that what you've envisioned as your American dream may not work out as planned. Be flexible. I think that's a key thing. Be very, very flexible. Be willing to change and go along with whatever comes up. If there's a possibility you can move to other countries, keep that in mind. Over the weekend, I was chatting with actually somebody who's in the US on F1 OPT, and he was telling me his company is going to try and do the H one B visa for him, but he was also saying to me, if they're not able to do that because they have a branch in Germany, we've talked about me, this is the person I was talking to, actually moving there.
Be Prepared Financially and Talk to an Immigration Lawyer
Speaker 1 (08:13):
So talk to your companies, find out if that's a possibility. Again, it could mean your version of the American dream changes a little bit and you may have to achieve it elsewhere. Other options, one thing is be prepared financially for anything that may come up. Okay, we're going to talk about the specific financial considerations of what to think about, but in terms of the preparations we are talking about, please, please talk to an immigration lawyer. They're likely going to get very busy. This is a time to get on their calendar. And one thing we always caution you about is we're not talking about your company's immigration lawyer, we're talking about an immigration lawyer outside the company. And one of the things they're likely going to tell you if there's a possibility that you spouse can get a work visa, if let's say you're on H one L one J or one one of those visas, it's worth absolutely pursuing that possibility. Manasa, what else can you say?
Know Everything You Need to Know about Your Visa
Speaker 3 (09:28):
I love the ideas that you just talked about. In fact, I think speaking of being prepared, I think the best thing to start doing is to become a student of your visa, right? Just know everything that you need to know about your visa. Of course, stay up to date because we will keep talking about this, but there are many other avenues where you can stay up to date on all of the visa regulations. And another life lesson that we have learned is be ready to pivot if necessary. Assume that there could be a danger of being laid off, and maybe this is where the pivot comes, start to look at if there could be more specific skill trainings that you could take. Maybe for example, what's the next hot topic out there? Ai. Try and see if that training is available to you. Maybe that's a good investment. Instead, invest in your education or enhancing your skill training or maybe get soft skills. So pivot is a good word here, I think. What do you say, Jane?
Network as Much as You Can
Speaker 1 (10:43):
I totally agree. And on top of that, now that you've talked about the specific skills class, start networking as much as you can. You don't want to wait until your job is gone. Start practicing. Yeah, your interview skills, practice as much as you can network, get to know people in the industry. So again, when that time comes, if it comes, you are ready to move on to the next gig, for example.
Financial Aspects to Consider for Immigrants
Speaker 1 (11:11):
So let's talk about specific financial things to be thinking about. Now we are going to get very, very practical.
Have an Emergency Fund
So the first thing is let's make sure you have a really nice emergency fund. And when we talk about an emergency fund, in this case, we recommend 12 months of cold cash. That's all I can think about calling it. We want this money to be very, very accessible. So somebody asked me the other day if maybe they should put it into CDs, but I think you really want these cash accessible. So like a high yield online savings account somewhere where you can just pull out the money you're going to need it as you're talking to immigration lawyers for example. And then the other thing we always add, if it hands out that you need to fly home, let's make sure it's 12 months of emergency funds plus the cost of airplane tickets to your home country, whatever that is.
Hold off on Making Big Purchases
Speaker 1 (12:14):
Again, if you have to leave, it's okay. Let's just make sure you are able to make that move and then hold off on making big purchases. Part of the American dream we know is to buy a home, and we've seen a lot of that, but I would say until we know for sure what's going to happen until your immigration situation is more permanent, it's really not a good idea to be making very big financial moves. So my suggestion is hold off on making big, big purchases in terms of investments, prioritize taxable accounts because they give you more flexibility. If your company's offering a 401k, I think it's okay to put some money in, but I would only go up to the match. So you get the free money. But beyond that, I think really put all your money into a taxable account. And of course when you put it in there, avoid what you call speculative investments.
Avoid Roth Accounts
Speaker 1 (13:20):
Avoid accounts like Roth accounts, those are all retirement accounts. It could be good, but this is where we talk a lot about consider the country where you are going to be, how they're going to treat some of these accounts. So I think keep it simple is really the way to go up to the match and then prioritize your taxable accounts because you want to give yourself flexibility, as much flexibility as you can. And then of course, if you're thinking of sending money back home, we've had folks say maybe we want to invest home. Obviously we can't advise you specifically on what investments to make in your home country. You really do need to think about the tax and financial implications in your home country in the us. And I'm sure Amana, you have a few things to say about taxes, right?
Continue to Stay Tax Compliant
Speaker 3 (14:14):
Of course. Absolutely. So yeah, continue to stay tax compliant. That almost goes without saying as you're making all these plans and possibly thinking of what other things you can add to your skillset. But most important is remember, if you're sending money back home, there are the F bars and the fatca. If you cross those thresholds, and of course if you are investing back home, then there are the mutual funds and other things as well. And to Jane's point earlier, if the Roth and the 4 0 1 Ks also come with their special tax considerations, if they are left in the US and you have moved back home, but then by the way, speaking about sending money home and foreign assets, we have heard from quite a few people that are looking to move abroad, and these are US citizens or green card holders who did not like how the election turned out.
Speaker 3 (15:21):
So the stats are actually crazy when I look it up, but Jane, it's, I have heard it's about 1500% of people a jump in the, the number of people thinking of moving abroad. And I believe these are countries like Canada and New Zealand and Australia and uk, which is totally understandable because these are all English speaking countries. But that statistic was kind of mind blowing. This is a trend we have already seen in recent years and irrespective of this election, there have always been people looking to move abroad. And in fact, we recognizing this trend, we had already decided to dig deeper into this. And in fact, we've already recorded one episode that could be coming out soon, and there's another one we have already planned for. So if that is your plan of moving abroad for a few years, then remember there are continuing tax and compliance requirements if all tax laws remain the same. So that's where we are going with right now, Jane.
Have an Estate Plan
Speaker 1 (16:34):
And the other thing now that you mentioned that anytime you think about moving abroad or even here, the other thing that comes to mind is as part of being prepared for anything is let's make sure your estate plan is in place in the us. And one thing I like to say to everybody, you don't have to have a million dollars to have an estate plan. The state already has an estate plan for you if you don't tell them what you want to do.
Have Appointed Guardians in Place
And so the things we are talking about is if you have kids who are under 18, you want to make sure you have guardians in place, you've appointed guardians in place, and it's very possible to have international guardians. I actually have a post on that and maybe we'll link to it. You may just need to work with an international estate lawyer to make sure you can get that in place.
Speaker 1 (17:34):
That's a question that comes up a lot. Who do I name as my kid's guardian? So you also want to make sure you have things like your medical will, your powers of attorney, powers of authority. You want to make sure you have all that in place regardless of what happens. So this is just good financial planning, but in our situation, this is even more critical that you have all these things in place. One of the sad things that we've seen, and I think you've also had a case manager, one of the few cases we've been talking about is where somebody passes away outside the country or they will hear, and the family is overseas and they really do not have anything put in place, and now their family is really suffering, trying to figure out what are the next steps. You know what I'm talking about?
Speaker 3 (18:30):
Oh yeah, yeah. The dying in test state. Yes. And this really becomes an issue, and this is sadly something that Jane and I have seen time and again, is the people who are left behind have no means of knowing what to do and how to connect. And that's compounded by the problem that there was no will or even beneficiary so many times I mentioned, and that becomes a really difficult thing. Would you, at this point, Jane, recommend term life or maybe disability insurance? Would you want to talk about that though?
Make Sure All Accounts Have Beneficiaries
Speaker 1 (19:14):
Yeah, that's a good one. But before I talk about that, you mentioned beneficiaries. Yeah, let's make sure all accounts have beneficiaries. That's absolutely key. So now when it comes to life insurance, that's the other one that we recommend everybody has, but let's say you're in the US on a non-immigrant work visa. You always have hopefully what the company's giving you, but we've been recommending having extra. The key thing is to go with a company that's willing to pay your family regardless of where you end up dying. So make sure you have extra life insurance. That's not a problem. Again, now you're really thinking of your family, and all you really need is to have a US account that can continue to be used for premium payment. So that's not an issue. Extra disability, that's a little bit of an issue because what we found is when let's say you become disabled and you can't work anymore, you need to stay in the country for the companies to pay you that money. And so if you're not able to work and so you're forced to leave the us, it's going to be really challenging for you to then have to travel back to the US so you can get the certification from the doctor. So at this point, it may not be worth doing the extra disability outside of work. Just go with whatever your company gives you. Besides that, what else should we be talking about?
Locking Your Credit
Speaker 3 (20:57):
I think also, Jane, maybe we do have an entire episode on this, but I think we should briefly mention that here is if you're going to leave the US but you still have US assets, you should be thinking about locking your credit so that nobody can touch your financial accounts. And then of course, update your address if you have to leave. And yeah, I think the couple of things that comes to my mind. Do you have anything else to add, Jane, at this point?
Speaker 1 (21:32):
No, I think this is, I don't want to say a continuing saga, but I think there's going to be more that's going to be coming up and there's more things come up and as we get more information and as we figure out how to help our clients and prospects, we'll be adding more onto this. At this point, what we'll say is we are very lucky we've made it this far. Things are still very peaceful. Just put your head down and let's wait and see what happens.
Speaker 3 (22:05):
I agree. I agree. Yeah. Stay tuned dear listeners, and we'll bring you more updates as we get them. Thanks for listening. Bye.
Speaker 4 (22:16):
Thank you for listening to the International Money Cafe podcast. The content is for informational and educational purposes only, and should not be used as a substitute for professional advice. Seek the advice of your qualified service provider with any questions you may have regarding your cross-border finances and tax needs.