Moving to Canada from the U.S.? How a cross-border financial advisor helps you meet your investment goals
Eddie and Lisa built a life in Canada, then got 30 to 90 days’ notice from their U.S. advisor. Their story shows why most Americans in Canada need a differently licensed advisor.
This article was published on November 7, 2023, more than 2 years ago and is not continuously updated. Tax and securities rules may have changed since. Check the sources at the end of the article, and the date, before acting.
For many Americans, living in Canada can be very appealing thanks to the country’s diverse nature, liveable cities and publicly funded healthcare. But once in the Great White North, U.S. expats can find themselves caught between a rock and a hard place when they invest with their U.S.-based financial advisors. They have to either find a new advisor within 30 to 90 days or liquidate their U.S. investment accounts.
That’s because, unlike cross-border financial advisors, most U.S. broker-dealers and investment advisory firms aren’t registered to do business with Canadian residents.
Eddie and Lisa
High school sweethearts, Eddie and Lisa were born and raised in the U.S. When they hit their 30s, they decided to move to Canada for work. Eddie was a doctor, and Lisa was a real estate agent. Together with three children, they made Canada their second home.
Chasing the Canadian dream, Eddie and Lisa focused on contributing to RRSPs managed by their financial advisor in Canada. However, since they became Canadian residents and were only making Canadian-sourced income, they weren’t allowed to fund their IRA and 401(k).
Why work with a cross-border financial advisor?
Two decades later, their U.S. advisor delivered bad news. “There’s been a change of rules. I’ll no longer be able to manage your IRA and 401(k) because you’re Canadian residents,” he said. “You have 30 to 90 days to find a new advisor, or I’ll have to liquidate your IRA and 401(k) accounts and mail you the net proceeds.”
What their advisor didn’t say is that a cross-border financial advisor can help them navigate those wealth management challenges, so they avoid a taxable and potentially penalized IRA and 401(k) distribution.
Cross-border financial advisors are licensed in both the U.S. and Canada and understand the complexities a financial life that spans borders can bring. They work with Americans living in Canada every day to avoid financial pitfalls and manage assets smoothly across the Canada–U.S. border, with solid financial plans and a disciplined investment strategy that help people with ties to both countries meet their goals.
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Chris is a cross-border financial advisor licensed in both Canada and the United States. He helps Americans moving to Canada and Canadians moving to the U.S. keep their retirement accounts intact and build one plan that covers both sides of the border. He writes for Cross Border Wealth in his personal capacity.
Disclosure: Chris writes in his personal capacity; his views do not represent any firm he is associated with. Cross Border Wealth does not provide advisory services. If you need advice, use the Get connected form and we will introduce you to a licensed professional.