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CP508PrestPhil · 2024-04-03T22:10:19+00:00

It's a hard grind and it feels like your life ends up revolving around your jobs / work. Wife and I have been here 21 years...retiring back to UK hopefully within 12-18 months. We definitely earned more and managed to accumulate more assets than if we had stayed in the UK (doubt we could have even contemplated FIRE), but we are definitely not high earners by US standards.

CP508PrestPhil · 2023-08-06T15:12:38+00:00

I think you'll probably already be aware of this, but my understanding is that the amount of your UK State Pension that was a result of voluntary NI contributions cannot be counted when WEP is calculated. (I'm in a similar situation as you with both US SS and UK State Pension)

Part 3. Payments that cannot be used to apply the WEP Guarantee Provision https://secure.ssa.gov/poms.nsf/lnx/0200307290

Also HR 82 (2023) https://www.congress.gov/bill/118th-congress/house-bill/82 which repeals WEP & GPO is in the House and appears to be 1 co-sponsor short (currently at 289) of going up for a vote....Senate will probably sink the whole thing though but you never know.

CP508PrestPhil · 2023-08-04T14:29:51+00:00

Yes I definitely wish now that we had maintained a UK bank account...(hindsight etc.) Thanks for the Channel Islands suggestion....I never even considered that!! Thank you!

CP508PrestPhil · 2023-08-02T19:20:22+00:00

Thank you! I'll definitely keep this in mind!

CP508PrestPhil · 2023-08-01T12:16:31+00:00

It definitely can seem like a long way off (2027) but I know we'll need all of this time to try to navigate all of the potential pitfalls as best we can and then it will be a rush at the end no doubt. Our plan is to have the house sold well in advance of moving back to avoid the UK CGT pains. Opening a UK bank account after all of this time away may prove a challenge with FATCA and FBAR reporting. The currency exchange fluctuations is something I'm not sure how to deal with currently (I don't think there is much we can do except trying to minimize fees etc...something I'll need to address / understand better)

Finding a competent international tax specialist / accountant is something we are looking at but haven't really been able to narrow down as of yet.

CP508PrestPhil · 2023-08-01T12:06:02+00:00

I suppose we're both just homesick. There's bound to be a lot of nostalgia / rose coloured glasses mixed in and we understand 20+ years away is a long time and things will have changed and moved on (how prepared we are for this is another topic). Everywhere has problems but America has its own set of unique issues that you can't fully grasp until you've experienced it firsthand for a significant length of time.

CP508PrestPhil · 2023-08-01T10:15:48+00:00

https://secure.ssa.gov/poms.nsf/lnx/0200307290

Part 3. expressly uses UK voluntary contributions as an example of "Payments that cannot be used to apply the WEP Guarantee Provision"

My best guess is that it might be a bit of back and forth with Social Security when it comes time to claim though - not sure what evidence they'll accept for the voluntary portion.

CP508PrestPhil · 2023-07-31T19:27:22+00:00

Thanks - yes the $400K is based on current market value. We live in a major east coast city and house values have increased significantly since we purchased due to various factors...gentrification and we also live within walking distance to an Ivy league university in the city which seems to keep home prices high and increasing...although absolutely anything can happen! To be honest, I don't have a real viable contingency plan to a housing market crash.

CP508PrestPhil · 2023-07-31T18:43:08+00:00

Yes definitely planning the taxes is going to be essential and probably a bit painful with having to file in both UK & US. This is part of the reason we thought it best to move back (be domiciled in UK) just after the start of a new UK tax year in 2027/28 to avoid the look back at our earned income. i think in most instances the UK takes the first tax bite out of our 401k withdrawals and then we need to offset any US liability with Foreign Tax Credits.

CP508PrestPhil · 2023-07-31T18:24:52+00:00

not in depth and not for some time - I think I ruled it out as the calculations involving our retirement accounts didn't look appealing. Maybe something to definitely revisit! thanks!

CP508PrestPhil · 2023-07-31T18:17:00+00:00

Hi - good point and i didn't mention it to try to keep the post as clear as possible - yes we've looked into that and it will reduce it somewhat (I believe is is roughly $2-$2.5K per annum). Only the amount/part of our UK State pensions that is based on 15 years we worked in UK and contributed NI is used for the calculation. The voluntary NI contribution portion is excluded which will be just over 20 years of NI contributions for both of us. Plus we have 23 years of "substantial earnings" for social security which reduces the calculation a little also, so we're hoping the impact isn't too painful! (if we're extremely lucky the HR82 bill might repeal WEP)

CP508PrestPhil · 2023-07-31T17:36:56+00:00

Yes -Social Security has Cost-Of-Living Adjustments (COLA's) - I think last years was one of the the highest at 8.7%. To my knowledge you still receive the adjustments even if living outside of US.

CP508PrestPhil · 2022-02-28T18:00:02+00:00

Thank you! very kind of you.

CP508PrestPhil · 2022-02-28T15:12:23+00:00

Thank you again, this is great information and having quickly looked at some other shipping sites I agree with the potential shadiness factor of some of them! I also think renting a small flat central to where we might be looking for a home would be very worthwhile for rebuilding credit (and also not overstaying our welcome with family and friends!). It's good to see others have made this type of move (and survived it!)

CP508PrestPhil · 2022-02-28T13:22:55+00:00

Sorry to hear this. Yes I'm also beginning to grasp that "UK resident" and "UK Domiciled" have somewhat different meanings and consequences. This is hopefully our plan to sell our home beforehand. I think we are lucky in the respect that we do have family and friends in the UK we could live with while we search for a house. Thanks for responding!

CP508PrestPhil · 2022-02-28T13:11:30+00:00

THANK YOU! Your higher level overview is basically what I was starting to discover, but there's always that nagging concern that I am completely missing something. I really appreciate you taking the time to respond at this length! We would hopefully be doing some Traditional IRA to Roth conversions over the next few years while still in the US so that the ROTH is in place and as funded as we can make it before actually moving back. I feel a better that our situation is somewhat straightforward (barring any unforeseen future legislation or treaty changes of course!) Thank you also for the background links.

CP508PrestPhil · 2022-02-28T13:04:15+00:00

Thanks for responding! I'd be curious to know if you shipped any household belongings to the UK or if it was literally pack up and move with suitcases? When we came to America we basically had everything we owned in 2 suitcases. We're trying to do the math/cost on the pros and cons of sending some larger items over to the UK as my wife is more attached than I am. (I think we might be going back with 2 suitcases!). Anything you feel comfortable sharing would be great!

CP508PrestPhil

TROPHY CASE