# US/UK planning retirement in France



## milliesmith

Hi All,

I'm back again, still trying to find our way to France after 10 years of research, and plans abandoned in 2020 with Brexit and the pandemic. Now we are considering retirement in France. I have a few questions, hope you don't mind me putting these to anyone in similar situation or experience who can share any info. I know we have to speak a financial advisor (can anyone recommend someone?).

We are US husband, and I'm UK with renounced green card - both residing in UK.

We have various sources of income including US IRAs, US SS, UK workplace pensions, US state pension and an ISA, proceeds from the sale of our house, some of which we will use to buy a home in France. 

US Pensions.
We know my OH will be taxed in the US on his US pensions at applicable tax rate, and I will be taxed a massive 30% on my Traditional IRA. I think we will not be taxed on our US SS benefits. I am aware of the France requirement to declare these pensions and we get credit etc. 

After doing some research, it seems to make the most sense to leave those pensions where they are and draw down on them monthly, quarterly...when needed. Is there anything to add here that I need to think about? 

UK Pensions:
I'm lost on what we need to do with your UK workplace pensions, I know we have some options, one is to take 25% tax free, and take the rest as lump sum and invest in France. It's not a huge amount of money, but enough to know we need to be smart with planning.

Can anyone share their experience on what they have done with UK pensions? And can anyone share any info on taxation please - what is most tax efficient option?

Funds from house sale:
Can anyone share what they have done with similar situation and funds, how to invest for growth - any tax implications if we transfer the income once resident in France? Can we just drop that money in Britline or Wise, or similar?

Again, I know we need to seek financial/tax advice - I am just keen to learn as much as I can first.

Finally - does anyone know if health insurance in France can include coverage for later in life care, meaning in-home nurses or nursing home care? Sorry if a bit vague - just thinking about all possible circumstances. 

Thank you as always to moderators and members of this great forum.


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## Bevdeforges

OK, welcome back to the expat track! Actually, I think you may be worrying about things that shouldn't cause any serious problems. But here goes:

*US Pensions.*: Your husband will remain on the hook for US taxes as you mention. And, assuming he files married, filing separately then you will be hit at the 30% rate for US SS and the IRAs. As you say, you declare them all in France and then receive a "tax credit at French tax rates" that should eliminate the French tax on those amounts. For the pension fund distributions (IRAs and such), you can keep them in place and just use a transfer service like Wise to manage the exchange rate and actual transfers.

*UK Pensions:* I will let our UK origin members advise you on this. Though again, you may want to look into using something like Wise to make the transfers and exchange rate stuff. 

*Funds from house sale: *As long as your house sale closes before your arrival in France, there should be no particular taxes or duties to pay on transfer of those funds to France. Like the UK, I don't believe France taxes profits on the sale of your primary residence, but I'm not sure of the details. Someone here might know better.



milliesmith said:


> Finally - does anyone know if health insurance in France can include coverage for later in life care, meaning in-home nurses or nursing home care?


Basically, no. The CPAM insurance (i.e. the national plan) may cover some elements of long-term care, especially if you are "required" to have such care due to a medical condition or accident or operation, but that is limited to what is necessary for "rehabilitation" that is part of your treatment. 

Given the two-part nature of French health cover, you may be able to find something by opting for a specific mutuelle cover. (Just to recap - the state cover doesn't cover 100% for most things, so you will need to find a mutuelle which serves as "top up" to the state plan. You get what you pay for, so it pays to compare available plans when the time comes - and different plans have very different levels and types of coverage.)


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## milliesmith

Bevdeforges said:


> OK, welcome back to the expat track! Actually, I think you may be worrying about things that shouldn't cause any serious problems. But here goes:
> 
> *US Pensions.*: Your husband will remain on the hook for US taxes as you mention. And, assuming he files married, filing separately then you will be hit at the 30% rate for US SS and the IRAs. As you say, you declare them all in France and then receive a "tax credit at French tax rates" that should eliminate the French tax on those amounts. For the pension fund distributions (IRAs and such), you can keep them in place and just use a transfer service like Wise to manage the exchange rate and actual transfers.
> 
> *UK Pensions:* I will let our UK origin members advise you on this. Though again, you may want to look into using something like Wise to make the transfers and exchange rate stuff.
> 
> *Funds from house sale: *As long as your house sale closes before your arrival in France, there should be no particular taxes or duties to pay on transfer of those funds to France. Like the UK, I don't believe France taxes profits on the sale of your primary residence, but I'm not sure of the details. Someone here might know better.
> 
> 
> Basically, no. The CPAM insurance (i.e. the national plan) may cover some elements of long-term care, especially if you are "required" to have such care due to a medical condition or accident or operation, but that is limited to what is necessary for "rehabilitation" that is part of your treatment.
> 
> Given the two-part nature of French health cover, you may be able to find something by opting for a specific mutuelle cover. (Just to recap - the state cover doesn't cover 100% for most things, so you will need to find a mutuelle which serves as "top up" to the state plan. You get what you pay for, so it pays to compare available plans when the time comes - and different plans have very different levels and types of coverage.)


Hi Bev,

Thank you. Yikes, I didn't realise I had to pay 30% on the US SS as well. Not sure how I missed that.

On UK side, will await info from others.

Thanks again.


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## Bevdeforges

milliesmith said:


> Thank you. Yikes, I didn't realise I had to pay 30% on the US SS as well. Not sure how I missed that.


Actually, it's 30% on 85% of your benefit. I guess you get an allowance for personal expenses or something like that. But figure you don't have to file any US tax forms anymore.

But do contact the FBU (Federal Benefits Unit) at the US consulate in Paris. They can direct deposit your US SS benefits each month to your French bank accounts and they generally get a really good exchange rate. No muss, no fuss, no transfer or exchange fees to mess with.


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## Crabtree

In respect of your UK private pensions you say that they are not a lot France is an expensive place to live AND you will need to prove a minimum income in France of about €1603 each per month ie equivalent to the French minimum wage when you come to apply for your Visa(you realise you will need one?) and health insurance to cover you until you can join the French system but being pensioners you will not need to make any contribution to the system but you are strongly advised to have a top up.When do you get your uk state pension?
In respect of taxation the Anglo French tax agreement means that all pensions (Except uk govt occupations such as police teachers etc) are taxed in France so you should arrange to have them paid tax free and then declare them to the french tax people ie you cannot choose where to have them taxed
Investments are a subjective thing depending on what you want to achieve but remember tax free in the uk is not tax free in France and vice versa and after Brexit you may not be able to find a UK finance house to take you on and likewise some members have had their uk bank accounts closed so opening a WISE multi currency account is a good idea
Hope that is helpful


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## 255

@milliesmith -- I'll just touch on a couple of things that haven't been mentioned. First, you didn't mention what kind of U.S. pensions you have (defined benefit or defined contribution,) but if they are defined contribution plans like an 401k, 403b, etc., you can roll them over to a traditional IRA and then do a Roth IRA conversion utilizing a "Roth Conversion Ladder" to escape high taxes (you can limit your conversions to stay under any tax threshold.) There are many members on this forum doing that. Obviously, if the pension is a defined benefit plan, this wouldn't be an option, but the traditional IRA could still be converted. These options would make sense for your husband, but probably not yourself -- you'd have to do the numbers. An additional benefit to the Roth, is there are no RMDs (required mandatory distributions,) so they can grow tax free for life (and a spouse's life,) and under current law, up to 10 years for your beneficiaries. If an American only has U.S. Social Security retirement income augmented by only a Roth IRA, they'd owe zero income taxes (none to France nor the U.S.) Obviously your situation is a little more complicated.

There are many options for your UK pension, but personally, I would try to simplify my life by either transferring it to France (you'd still owe the UK taxes on the transfer, 7.5%,) or just take the lump sum with the tax hit and be done with the "plan."

A couple of other issues that you have probably already sorted since living in the UK, is the address for your U.S. financial accounts, U.S. banks, etc. Quite a few members have had surprises when trying to change to an overseas address. I myself have contracted with a "mail forwarding service" (in a no state income tax state) to utilize as an address for my U.S. financial accounts (I had previously used a family member's address with less than desirable results.) The other is obtaining a French bank account before the move. You might consider opening a non-resident account, which will convert to a resident account after our move. There have been quite a few members (that already had high level UK accounts) open French accounts with HSBC. Although I've read, on the forum, that HSBC is decamping from France. The other bank that I've seen members open non-resident accounts is BNP-Paribas (my wife and I are in the process of this route.) Although at least one member thought they were expensive (5 EUR per month and 135 EUR per year for their "middle" credit card option.) I've tried another bank, I was interested in, but they didn't want "foreign," clients (at least not U.S., FATCA and all.) Cheers, 255


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## Tricky Dicky

I’ve just opened a Wise account. Is it true that they will charge you if you keep above, I think, €20,000 in one of their accounts? I’ve just sold a small rental property and dumped the proceeds in a Wise euro account.


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## milliesmith

Crabtree said:


> In respect of your UK private pensions you say that they are not a lot France is an expensive place to live AND you will need to prove a minimum income in France of about €1603 each per month ie equivalent to the French minimum wage when you come to apply for your Visa(you realise you will need one?) and health insurance to cover you until you can join the French system but being pensioners you will not need to make any contribution to the system but you are strongly advised to have a top up.When do you get your uk state pension?
> In respect of taxation the Anglo French tax agreement means that all pensions (Except uk govt occupations such as police teachers etc) are taxed in France so you should arrange to have them paid tax free and then declare them to the french tax people ie you cannot choose where to have them taxed
> Investments are a subjective thing depending on what you want to achieve but remember tax free in the uk is not tax free in France and vice versa and after Brexit you may not be able to find a UK finance house to take you on and likewise some members have had their uk bank accounts closed so opening a WISE multi currency account is a good idea
> Hope that is helpful


@Crabtree thank you. The workplace pension is more than enough to meet the visa requirement, and beyond for a few years. We will be 60 when we move to France, so a while before eligible for UK state pension. Fortunately we also have other means which we believe to be enough to support plans for our life in France. Also aware of the health insurance and the top up - thank you.
I don't fully understand what the issue is with putting our money somewhere where it will work for us - but thanks for making me aware. You can never have too much information.


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## milliesmith

255 said:


> @milliesmith -- I'll just touch on a couple of things that haven't been mentioned. First, you didn't mention what kind of U.S. pensions you have (defined benefit or defined contribution,) but if they are defined contribution plans like an 401k, 403b, etc., you can roll them over to a traditional IRA and then do a Roth IRA conversion utilizing a "Roth Conversion Ladder" to escape high taxes (you can limit your conversions to stay under any tax threshold.) There are many members on this forum doing that. Obviously, if the pension is a defined benefit plan, this wouldn't be an option, but the traditional IRA could still be converted. These options would make sense for your husband, but probably not yourself -- you'd have to do the numbers. An additional benefit to the Roth, is there are no RMDs (required mandatory distributions,) so they can grow tax free for life (and a spouse's life,) and under current law, up to 10 years for your beneficiaries. If an American only has U.S. Social Security retirement income augmented by only a Roth IRA, they'd owe zero income taxes (none to France nor the U.S.) Obviously your situation is a little more complicated.
> 
> There are many options for your UK pension, but personally, I would try to simplify my life by either transferring it to France (you'd still owe the UK taxes on the transfer, 7.5%,) or just take the lump sum with the tax hit and be done with the "plan."
> 
> A couple of other issues that you have probably already sorted since living in the UK, is the address for your U.S. financial accounts, U.S. banks, etc. Quite a few members have had surprises when trying to change to an overseas address. I myself have contracted with a "mail forwarding service" (in a no state income tax state) to utilize as an address for my U.S. financial accounts (I had previously used a family member's address with less than desirable results.) The other is obtaining a French bank account before the move. You might consider opening a non-resident account, which will convert to a resident account after our move. There have been quite a few members (that already had high level UK accounts) open French accounts with HSBC. Although I've read, on the forum, that HSBC is decamping from France. The other bank that I've seen members open non-resident accounts is BNP-Paribas (my wife and I are in the process of this route.) Although at least one member thought they were expensive (5 EUR per month and 135 EUR per year for their "middle" credit card option.) I've tried another bank, I was interested in, but they didn't want "foreign," clients (at least not U.S., FATCA and all.) Cheers, 255


@255 Thank you. We have Roth and Traditional IRA. We have done the numbers with our US financial advisor and decided for us it doesn't make sense.

I like your idea about the UK pensions - keeps it simple.

We are sorted with address for the UK, but thank you for mentioning, I guess we should check if France address is going to be okay. Will add to to-do list.

For bank account - would be good to know how things go with BNP-Paribas. We have heard others say CA Britline has worked well.

May I ask please roughly where you are located in France - and do you like the location? 

Many thanks for your help.


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## milliesmith

Tricky Dicky said:


> I’ve just opened a Wise account. Is it true that they will charge you if you keep above, I think, €20,000 in one of their accounts? I’ve just sold a small rental property and dumped the proceeds in a Wise euro account.


Oh gosh, I don't know - but thanks for highlighting, maybe someone else will know.


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## Tricky Dicky

I’ve just looked into it. You get a free allowance of €15,000. Above that, if you keep a balance for a year, they will charge you €4 per thousand above the €15,000. It’s 1c for a day and 33c for 30 days. I’m going to have to shift it somewhere.


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## bhamham

Tricky Dicky said:


> I’ve just looked into it. You get a free allowance of €15,000. Above that, if you keep a balance for a year, they will charge you €4 per thousand above the €15,000. It’s 1c for a day and 33c for 30 days. I’m going to have to shift it somewhere.


See if you can open a business account with Wise. I believe the limit is 70,000 euros.


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## 255

@milliesmith -- We'll submit our application for a BNP-Paribas joint account/credit card today (we've been gathering required docs.). We'll scan and send PDFs by e-mail. We had a telephone interview with a bank counselor earlier in the week, for both of us to ask questions of each other. She said it'll be two weeks before we hear, but didn't see any problems. I'll make a new thread, if successful.

I have also read about folks obtaining accounts successfully from CA Britline, but since I'm American, I didn't investigate it. There have been a couple of members who didn't reside in France, the UK or Ireland turned down (who were UK citizens.) I don't know if your husband's American linage would complicate anything there or not.

Unfortunately, we are also not in France yet and like you, have been planning to move there for over a decade (my own medical issues, our parent's sicknesses/deaths, grandchildren's births, 2007/8 financial fiasco, the pandemic and now a crazy madman invading Europe,) have all postponed our move. My wife has lived in Paris before (but her words -- been there, done that.) I've lived over a decade in Germany and have traveled extensively in France (and the old Western Europe,) Our plan was always to move to the Annecy area, but haven't nailed down a specific location yet. We have three children, living in three different states with their own families, so we're taking GEN Schwarzkopf's advice and since we aren't moving to be close to family, we're moving to a place the kids would want to visit. They are all avid skiers. We may look further South, as we've aged a bit. In any event, we like both locations. Unless the war in Ukraine ends, we'll probably push our house hunting trip off to next year. Cheers, 255

P.S. I hope your U.S. financial advisor calculated the increase in tax on your husband's social security -- I've found that most CFPs don't. Your husband's traditional IRA distributions may boost the amount of social security being taxed, much higher than the normal exempt amount.


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## Peasant

milliesmith said:


> ...and I will be taxed a massive 30% on my Traditional IRA...


Nope. The withholding on your IRA might be 30%, although there's no reason why that should be the case, but once you file your 1040 you should find that the income tax on your IRA will work out to be 15% or less. Unless, of course, your taxable income is very high.


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## Bevdeforges

Peasant said:


> but once you file your 1040 you should find that the income tax on your IRA will work out to be 15% or less. Unless, of course, your taxable income is very high.


But she is not a US citizen and has given up her green card, so is considered an NRA - unless she and her husband choose to file jointly (in which case all income in her name must be reported to the IRS). As an NRA, her US SS actually is taxed at 25,5% on the total (i.e. 30% of 85%) but it increases the chances that her US citizen husband's US SS may not be taxed by the US at all (depending on what other income he has).


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## SPGW

Regarding UK pension:
I don’t think it is a simple matter of transferring it to France, unless you already have a pension fund from working for a French employer, to which you make a voluntary contribution from your uk fund, and even then the maximum is restricted. Alternatively, you transfer out of your uk fund but would be hit with French income tax. Better not to touch it, especially if it has been a well managed fund so far (many transfer-out promoters are scammers, to be avoided) and drawdown monthly as income in Fr. Since you’ll be taxed on it as income in Fr, and you’re looking at minimising tax liabilities, best spread over a maximum time period.


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## milliesmith

255 said:


> @milliesmith -- We'll submit our application for a BNP-Paribas joint account/credit card today (we've been gathering required docs.). We'll scan and send PDFs by e-mail. We had a telephone interview with a bank counselor earlier in the week, for both of us to ask questions of each other. She said it'll be two weeks before we hear, but didn't see any problems. I'll make a new thread, if successful.
> 
> I have also read about folks obtaining accounts successfully from CA Britline, but since I'm American, I didn't investigate it. There have been a couple of members who didn't reside in France, the UK or Ireland turned down (who were UK citizens.) I don't know if your husband's American linage would complicate anything there or not.
> 
> Unfortunately, we are also not in France yet and like you, have been planning to move there for over a decade (my own medical issues, our parent's sicknesses/deaths, grandchildren's births, 2007/8 financial fiasco, the pandemic and now a crazy madman invading Europe,) have all postponed our move. My wife has lived in Paris before (but her words -- been there, done that.) I've lived over a decade in Germany and have traveled extensively in France (and the old Western Europe,) Our plan was always to move to the Annecy area, but haven't nailed down a specific location yet. We have three children, living in three different states with their own families, so we're taking GEN Schwarzkopf's advice and since we aren't moving to be close to family, we're moving to a place the kids would want to visit. They are all avid skiers. We may look further South, as we've aged a bit. In any event, we like both locations. Unless the war in Ukraine ends, we'll probably push our house hunting trip off to next year. Cheers, 255
> 
> P.S. I hope your U.S. financial advisor calculated the increase in tax on your husband's social security -- I've found that most CFPs don't. Your husband's traditional IRA distributions may boost the amount of social security being taxed, much higher than the normal exempt amount.


Hi 225 - I don't think our advisor considered my husbands social security. Thank you, I'll add this to the list. Clearly this is complicated and we need some good tax advice. Good luck with your move, when it happens.


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## milliesmith

SPGW said:


> Regarding UK pension:
> I don’t think it is a simple matter of transferring it to France, unless you already have a pension fund from working for a French employer, to which you make a voluntary contribution from your uk fund, and even then the maximum is restricted. Alternatively, you transfer out of your uk fund but would be hit with French income tax. Better not to touch it, especially if it has been a well managed fund so far (many transfer-out promoters are scammers, to be avoided) and drawdown monthly as income in Fr. Since you’ll be taxed on it as income in Fr, and you’re looking at minimising tax liabilities, best spread over a maximum time period.


@SPGW - thank you. That makes sense. 

Back to a point Bev made, to complete on the house sale before moving to France so we have the cash before we move. Bev, but what happens if we sell the house and don't get the visa for any reason - feels a bit too risky? Does anyone know by what timeframe you have to enter France once you have the visa approved?

The US tax matters are a bit of worry for me. Thanks all for your help.


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## Bevdeforges

milliesmith said:


> Does anyone know by what timeframe you have to enter France once you have the visa approved?


Basically if you get a one year visa, they will stipulate the starting date. They used to ask you when you wanted the visa to start - but we've had some indications that they may just make it valid within a few days of the issue date. But either way, you have one year from that first date of validity (hence, if they ask you when you want it to be valid, go for your intended travel date). That first visa serves as your "titre de séjour" (residence permit) for one year from the validity date - and you need to start the renewal process a couple of months prior to the expiration date. If you leave things too long, you simply won't have the various documents you need to start the renewal process on time. 

If you sell the house and for some strange reason get turned down for the visa, you need to find someplace else to live for a while.


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## milliesmith

Bevdeforges said:


> Basically if you get a one year visa, they will stipulate the starting date. They used to ask you when you wanted the visa to start - but we've had some indications that they may just make it valid within a few days of the issue date. But either way, you have one year from that first date of validity (hence, if they ask you when you want it to be valid, go for your intended travel date). That first visa serves as your "titre de séjour" (residence permit) for one year from the validity date - and you need to start the renewal process a couple of months prior to the expiration date. If you leave things too long, you simply won't have the various documents you need to start the renewal process on time.
> 
> If you sell the house and for some strange reason get turned down for the visa, you need to find someplace else to live for a while.


Thank you Bev.


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## Lancashire_Lass

Hi. Lurking in the background here as in a similar situation (US pensions and SS as well as UK similar). Beginning to wonder if got good advice also. A well known form of advisers advertised on one of the big sites for property etc. advised me to sell everything I have in the US - basically liquidate 401(k) etc. - before coming to France. That seems to be the opposite of what everyone’s experience is? He wants to put into an Assurance Vie btw. 
Anyway, another perspective and seems to indicate that there are as many strategies as advisers 🤭. Will be very interested should you find someone who can offer advice you feel comfortable with. Currently I am also trying to work out the options after I renounce my GC and more to France via UK. Good luck! I am sure it will be worth it for many reasons that are not financial that will bring compensations 😊


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## milliesmith

Lancashire_Lass said:


> Hi. Lurking in the background here as in a similar situation (US pensions and SS as well as UK similar). Beginning to wonder if got good advice also. A well known form of advisers advertised on one of the big sites for property etc. advised me to sell everything I have in the US - basically liquidate 401(k) etc. - before coming to France. That seems to be the opposite of what everyone’s experience is? He wants to put into an Assurance Vie btw.
> Anyway, another perspective and seems to indicate that there are as many strategies as advisers 🤭. Will be very interested should you find someone who can offer advice you feel comfortable with. Currently I am also trying to work out the options after I renounce my GC and more to France via UK. Good luck! I am sure it will be worth it for many reasons that are not financial that will bring compensations 😊


@Lancashire_Lass Very interesting as I received the exact same advice, and when I later mentioned this approach with someone else, independent, he did not at all agree with the advice I was given, so as you say, many approaches. I will let you know if I have any success. When are you moving to France, and where do you plan to live?


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## Lancashire_Lass

milliesmith said:


> @Lancashire_Lass Very interesting as I received the exact same advice, and when I later mentioned this approach with someone else, independent, he did not at all agree with the advice I was given, so as you say, many approaches. I will let you know if I have any success. When are you moving to France, and where do you plan to live?


Thanks! Ditto - if I find out anything will let everyone know. There seems to be many more people here that mention their 401(k) etc., and so there may not be an enormous downside as otherwise surely people would be liquidating in droves. I think his point was the money would grow as well as it would here in the US, but not be so taxable. Although the benefit to him cannot be discounted, not can the large bump to income in the year of withdrawal and all that implies... I will look at it however, maybe in the 3 months before become UK tax-resident in April when I do not have any other US income. He did stress I needed to do it BEFORE arriving in France though, so a bit-by-bit might not work as then France might tax also.
My plan currently, based on the advice from this forum (thank you all!) is to move back to UK before end December this year and then spend two 3 month stints in France looking at likely locations (winter Jan-Mar 2023 and then summer 2023) before long term visa and a rental from which to do my house-buying searches. Would love to just make the leap, but there seem to be as many opinions on the nice locations as there are financial ones! So my situation may be different from that perspective. And of course, finding a house while trying to lug around a three-bed house-worth of stuff isn't ideal. And I have already decided selling up isn't an option.
My preferred locations are in the West and mainly driven by a dislike of too much summer heat, as well as a dislike of snow/ice (I am one nasty fall away from a disability according to my back surgeon). So looking at the Charente, and possibly Dordogne if the summer isn't too warm, however, despite the rain and cold I love the look of Normandy. The high (and rising prices generally) of coastal areas near Bordeaux will likely push me more inland too. I also factor in the availability of Healthcare. I look at the comments from the members here and hoard those that give an indication of pros/cons where they live. I am not yet familiar enough to be able to locate via the 2 digit prefix. Maybe there is a handy crib sheet lol. Do let me know if you have any tips from your searches!


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## Lydi

Lancashire_Lass said:


> I am not yet familiar enough to be able to locate via the 2 digit prefix. Maybe there is a handy crib sheet lol.


Try this:


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## SPGW

Interesting thoughts on pension planning. I have roughly a third of working life in each of UK, US and FR. Income for the rest of my life will depend on this, so let's say, it is quite important. I have come to the conclusion over the years and from multiple attempts from "advisors" in the 3 locations and elsewhere, to persuade me to take action with invested funds (US 401k, UK works pension schemes...), that true independent financial advice doesn't really exist. No harm in listening to what they all propose, and distilling that down to what fits your circumstances.

When UK legislation on pensions changed for non-residents, I was bombarded with "advice", listened, and concluded that the best action in my situation was no action. Any transfer starts with costs - admin, transfer and start-up fees, commission, exchange rates...etc etc, even if some claim there are none. I started by estimating how many years it would take to recoup these initial losses (honest "advisors" actually discussed this). Compare this with how each fund (UK, US, FR in my case) has actually performed. They are managed by people who do a pretty good job in the interests of (ex)employees. Why would some unknown entity do any better?

As @lancashire lass wisely says, there will be better compensations elsewhere.


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## Bevdeforges

When you are dealing with foreign pension funds (i.e. where you have a sum of money invested and it's up to you - or your advisor - to manage the fund to your advantage), don't forget that there will always be two aspects to your "planning." 

The first one is going to be that of whether or not the fund continues to grow based on investment returns. Back in the Great Recession of 2008 or 2009 (or whenever that was), lots of folks in the US found themselves with a mere 50% of the money they thought they had for retirement because the market had tanked across the board. For those who were planning on retiring right about then, it was a massive blow. Then again, for those who weren't going to retire for another 10 years or so, the funds pretty much recovered in that time.

The second factor, though, is that of exchange rates. If you are successfully settled in France or Italy or Spain or wherever, you'll be living your life in euros (or whatever the local currency is wherever you retire). You can suffer enormous losses if one currency tanks or the other currency suddenly increases (and both have happened in recent memory) no matter how "well" your portfolio is doing. 

By transferring your whole retirement pot at once, you are locked in to whatever the exchange rate is at the time you make the transfer. But, by distributing it like it was a regular pension, you suffer the vagaries of the currency marketplace and will receive more or less each month (or quarter) depending on how the currencies are doing one against the other. There is the same risk in something like the US SS benefit - but at least you won't hit the bottom of the barrel. Those payments will continue to keep coming (at whatever exchange rate) until your death - something a bit more secure than with the sums you have invested in various plans.


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## Lancashire_Lass

Lydi said:


> Try this:
> 
> View attachment 101361


Thanks! Printed 😊


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## 255

@SPGW -- I concur with you assessment and think having your pensions diversified by currency, managers and countries is a smart move. Your UK pension will be taxed in France (unless it's a type of civil/military type pension, then it'd be taxed at the source,) in the UK. Of course, your French pension will be taxed in France (unless it has some form of special tax treatment,) and your US 401k will only be taxed by the U.S., if you stay resident in France. Where depending on your individual situation, you may or may not owe any taxes. As you say, lot of food for thought and lots of choices to be made to ameliorate your (our) own situation(s). Cheers, 255


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## milliesmith

255 said:


> @SPGW -- I concur with you assessment and think having your pensions diversified by currency, managers and countries is a smart move. Your UK pension will be taxed in France (unless it's a type of civil/military type pension, then it'd be taxed at the source,) in the UK. Of course, your French pension will be taxed in France (unless it has some form of special tax treatment,) and your US 401k will only be taxed by the U.S., if you stay resident in France. Where depending on your individual situation, you may or may not owe any taxes. As you say, lot of food for thought and lots of choices to be made to ameliorate your (our) own situation(s). Cheers, 255


@SPGW @255 and All Apologies, just realised I didn’t thank you for your comments. Very much appreciated as always. 
@Bevdeforges I have a question about social security cotisations for our situation- will add to this thread as it includes some of our background but let me know if I should start a new thread.
We plan to move to France as early retirees, what would we pay in cotisations once we are fully registered for French healthcare and have our carte. I am UK citizen, OH is US citizen and we would reach full retirement age (67) about 5 years after we arrive in France. Is anyone in a similar situation able to share their experience/knowledge of French healthcare system and cotisations we can expect to pay as early retirees and then once we get to retirement age. Are US citizens at retirement age also eligible for something similar to S1? 
Thank you again in advance for your help.


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## Bevdeforges

milliesmith said:


> We plan to move to France as early retirees, what would we pay in cotisations once we are fully registered for French healthcare and have our carte.


Just be aware of the definition of "early retiree" used for French administrative services here. You are a "retiree" when you start taking your pension - so waiting for the full retirement age of 67 in the US may or may not be a great idea in your cases. Up to you to weigh the pros and cons of your own situation. (OTOH, an IRA or 401K is considered a government pension - so you could start taking regular distributions from your funds at 59 1/2 to be considered to be drawing a pension.)

There is no S1 equivalent for the US (and actually, I'm not sure how much longer the S1 is going to be relevant for Brits, given that it is an EU document - though check the WA if this is applicable to you). All you need is to show that you are drawing a government pension from the US (or elsewhere). Before that time, your contribution for health cover will be a calculated part of your declared annual income (usually verified using tax declarations) - around 8 or 9% I think, but with an allowance for the first few thousand euros, and a cap on the total amount assessed that still makes it far cheaper than anything you'd get in the US. (Probably worth factoring in to your consideration of when to start taking your US Social Security benefits.)


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## milliesmith

Ah thanks Bev - got your point re “retiree” vs “early retiree”. Are UK workplace pensions SIPP considered a government pension although it’s not same as a state pension? But agree, earlier Roth drawdowns also an option.


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## Bevdeforges

Sorry, I don't know the status of the UK pensions - but the IRA and 401K funds are specifically named in the US-France tax treaty as being treatable as government pensions.


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## 255

@milliesmith -- Just to add to @Bevdeforges' comment on U.S. Social Security retirement benefits and @Crabtree's reference to the minimum income required for visa purposes. As I'm sure you know, the earliest, you can draw SS retirement is age 62 (with reduced benefits.) If you can qualify for a visa without drawing on your U.S. Social Security, you should certainly consider that option. I understand that if you need that income for other reasons -- then go for it. After all the most common age that U.S. recipients of social security retirement is age 62. However, every year you take early (before FRA,) you'll sacrifice about 8% forever. Likewise, if you delay SS retirement, up to age 70, you'll gain an additional 8% for each year you delay, for life. (The real calculation is much more complicated, but 8%, not counting inflation adjustments is "about" right.)

There are many "SS retirement calculators" on the web, some better than others, some free, but better ones have a cost. Also, you should do the calculations as a couple -- taking into account your personal financial situation, individual income histories, health, family longevity, etc. Conventional wisdom is that holding off until age 70 is the smart ticket -- but often drawing at FRA and even at age 62 can be more advantageous, depending on your individual circumstances. My main point is that deciding when to draw U.S. SS retirement deserves it's own planning. Cheers, 255


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## ToutesDirections

This.



255 said:


> @milliesmith -- I'll just touch on a couple of things that haven't been mentioned. First, you didn't mention what kind of U.S. pensions you have (defined benefit or defined contribution,) but if they are defined contribution plans like an 401k, 403b, etc., you can roll them over to a traditional IRA and then do a Roth IRA conversion utilizing a "Roth Conversion Ladder" to escape high taxes (you can limit your conversions to stay under any tax threshold.)


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## milliesmith

Thank you again all. @225 - sorry to keep checking, just to be sure… if we are both drawing from our US pensions, we don’t pay cotisations for French healthcare, correct?


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## Bevdeforges

milliesmith said:


> Thank you again all. @225 - sorry to keep checking, just to be sure… if we are both drawing from our US pensions, we don’t pay cotisations for French healthcare, correct?


You don't necessarily need to both be drawing from your US pensions. I think it's sufficient that one of your is drawing a pension so that the "whole family" is covered.


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## milliesmith

Thanks Bev. So based on this….I’m just thinking of options…..perhaps it would not be sufficient to draw some funds from our US pension as a top up to another income source? e.g. draw from our IRA pension as a top up to non-US income source?
Thank you!


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## Bevdeforges

If you are relying on a non-pension income source, I'm not sure they would count the "top up" from a pension fund (like an IRA) as meeting the pension requirement to enjoy free access to the national health care. But, I fully admit I don't know what the details are concerning that.


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