Financial Planning

Financial Advisors for Immigrants & Foreign Nationals

By  Brian Thorp

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Whether you’re a foreign national living in the US with a green card or you’re working on a visa, you have very unique needs when it comes to financial planning. And depending upon whether you’re on a path towards US citizenship or planning to return to your home country, the financial decisions you make today can have a significant impact on your financial future.

It can feel overwhelming for immigrants to try and navigate the complexities of the US tax system, not to mention making sense of the numerous retirement and savings accounts and their potential tax benefits. Beyond taxes, understanding how to make the most of your employee benefits, saving for retirement and funding your children’s education are additional priorities that can take a lot of time to figure out on your own.

Fortunately, there are financial advisors who have walked in your shoes and know what it’s like to arrive in the United States feeling confused and unsure when it comes to money matters. By hiring a financial advisor who specializes in working with immigrants and foreign nationals, you’ll feel more confident knowing you can ask questions and get answers that other advisors simply wouldn’t know or understand.

And it’s easier today than ever before to find a specialist financial advisor dedicated to working with immigrants and foreign nationals in the US. Beyond researching financial advisors in your neighborhood which could significantly limit your access to specialists, you may find the best financial advisor for you lives several states away and is easy to work with virtually, often via Zoom online meetings, for example.

So is a financial advisor who specializes in serving immigrants right for you?

Let’s learn more by getting answers from financial advisors featured on Wealthtender who offer their perspective on the potential benefits of working with a specialist for immigrants.


👩‍💼 Get to Know Financial Advisors Who Specialize in Serving Immigrants

This page is organized into sections to help you quickly find the information you need and get answers to your questions:

  1. Q&A with Financial Advisors Who Specialize in Serving Immigrants
  2. Get Answers to Your Questions About Financial Planning for Immigrants
  3. Browse Related Articles

– Financial Advisors Who Specialize in Serving Immigrants –

Three Questions with Jane Mepham:

We asked Austin-based financial advisor Jane Mepham to answer three questions she often hears from the immigrants she serves when helping them develop a financial plan for their future.

Q: I’m currently in the US on a work visa. Why should I consider hiring a financial advisor in the US?

Jane: The US financial system is complex and can be very confusing to somebody new to the country. A good financial advisor is invaluable as they can guide you through not only setting yourself up financially, but also in helping you prioritize competing financial needs. You are going to have a lot of questions especially the first year, along the lines of setting up a budget, that might include supporting your family overseas, choosing the right kind of retirement plan, health, life (not every company will agree to insure you) or disability insurance. A financial advisor can easily guide you through these issues.

One of the biggest issues you are likely to face is the tax implications of being a US person, keeping in mind that the US taxes you on worldwide income and your immigration status. You’ll need to figure out if you should be filing taxes as a tax resident or non-resident. In addition, you are likely to have reporting requirements if you have overseas accounts, for example filing FBAR forms. At this juncture a financial advisor becomes critical, as they can help you figure out these issues. Picking the right advisor and working with them over a couple years, may prove to be the best decision you’ll make in your life in the US.

Here are some resources that might answer some of your questions as you start on your work visa journey in the U.S.

Q: What should I consider before participating in my US employer’s 401k plan?

Jane: The 401k plan is a retirement plan offered by many US employers. Every employee including those on works visas is eligible to participate. Different companies have different waiting periods. Here are some things to consider before participating:

  • Regardless of how long you intend to stay in the country (work visas are not permanent), contributing to the 401k plan reduces your taxable income, meaning you get to pay lower taxes now.
  • Typically, we’d recommend maxing out the plan. In 2021, you can invest up to $19,500. If you are not sure about being able to max it out, consider if your company is offering a match, and plan to save up to that amount to get the free money (employer match).
  • This also applies to the situation where money is a little tight, and you are not sure you are able to max it out. Again, consider putting enough to earn the employer match especially as you are starting out on a new job. The goal is to take advantage of compound interest and have your money in the market for a long time.
  • Another thing to consider are the investment options offered in the plan. If there are life-strategy or target-date funds, those are the easiest ones to start with. If the investment options are below par, again consider saving up to the employer match.

Q: If I’m planning for my children to attend college in the US, what’s the best way for me to save for their education?

Jane: Immigrants tend to value education greatly and they are willing to do whatever it takes to help their kids attend the best schools. To accomplish this goal, start saving for college as soon as possible. There are a couple ways to do this, and each has its own advantages and disadvantages.

529 plan – This is a government provided plan specific to education, and in this case college. The money goes in after taxes, grows tax-free and comes out tax-free if it’s used for education related expenses.

Every state has its own plan and most of them will allow non-residents to open a plan there. There are about six states that don’t allow outsiders into their plan. In terms of where, if your state offers some type of tax break (deduction or tax credit), then it makes sense to consider opening a plan in your state.

Finally keep in mind that the beneficiary must be a citizen or a permanent resident to be able to use the funds in the plan. If the intended beneficiary is not a citizen yet, you can open the account with yourself as the beneficiary and change it later to the kids when they become citizens or permanent residents.

If you end up not using the money, for education related expenses, you’ll pay taxes and a 10% penalty fee on the earnings. Here is a blog post that answers a question I see come up a lot in this space about opening a 529 plan if on a work visa.

Roth IRA Account – We typically think of this a retirement account, but it can be used for saving for college as well. Your income must be below a certain threshold to be able to open the account, but with the backdoor Roth option, income threshold is not an issue anymore.

In 2021, the max that can be put into the account is $6,000 ($7,000 if over 50). Ideally both parents will each open an account. The initial contribution can be withdrawn anytime, penalty free for education related expenses, while allowing the earnings to continue growing for retirement. If you withdraw the earnings for college expenses, the 10% penalty does not apply, but you’ll pay taxes on that.

At age 59 and ½, the earnings can also be withdrawn tax-free and penalty free to pay for college expenses.

Brokerage Account – There are no tax advantages to this account, but it gives you a lot of freedom in what you do with the money, how you invest it, etc. If the funds are held in the account for more then a year, you’ll pay capital gains taxes which is lower than ordinary income tax. In applying for college aid, the account is included as the parents’ assets.

Custodial Accounts – The two main accounts in this space are UGMA (Uniform Gift to Minors Act) and UTMA (Uniform Transfer to Minors Act). Keep in mind that even though you are the account owner, the child legally owns the money in the account. They get to control the account when they reach the legal age as defined by the state. It’s a great way to start gifting kid’s money early on in life but consider that at the legal age they may choose not to use the account for college education and there is nothing you can do about it. It’s considered a child’s asset for college funding considerations.

 Coverdell Education Savings Accounts (ESA) – This account is very similar to a 529 plan but is limited in how much you can contribute. You can only save up to $2,000 per year, per beneficiary and you can only use it if your income is below $110,000 ($220,000 if married).

All the above plans can be combined to come up with something ideal for each family depending on their unique situation. A financial advisor is  able to help you pick the best plan keeping in mind your immigration status, your income, your needs, and other issues specific to your family.

Get to Know Jane Mepham:

View Jane’s profile page on Wealthtender or visit her website to learn more.

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About the Author
Brian Thorp, Founder and CEO of Wealthtender profile picture

Brian Thorp

Founder and CEO, Wealthtender

Brian and his wife live in Texas, enjoying the diversity of Houston and the vibrancy of Austin.

With over 25 years in the financial services industry, Brian is applying his experience and passion at Wealthtender to help more people enjoy life with less money stress.

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Disclaimer: The information in this article is not intended to encourage any lifestyle changes without careful consideration and consultation with a qualified professional. This article is for reference purposes only, is generic in nature, is not intended as individual advice and is not financial or legal advice.

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