5 powerful benefits of working with a financial planning firm if you’re an expat

While it may not be an obvious link, an article by Reuters explains that the milder than predicted weather at the start of 2023 could be helping Europe’s economy. It reveals that fears of high energy prices, shortages and recession could be proving to be wrong, because the warmer temperatures halved the price of natural gas.

The article adds that economists at Goldman Sachs believe that Europe will no longer see a “technical recession” due to the gas price drop and China’s re-opening following its severe Covid lockdown. Additionally, the news agency revealed that German businesses expect a mild recession in 2023, as disruptions caused by shortages of materials and higher energy prices are likely to be less severe.

All of this reminds us that the economy doesn’t always do what’s expected, and understanding what the unexpected means for your money can be tricky. That is why conducting a review of your financial situation at the start of the year can be a shrewd move.

It provides the opportunity to assess what has happened the previous year and to develop a strategy for the year ahead. When you do this, it’s usually best to work with a trusted financial planner who can help you understand your options, provide peace of mind and help you maximise your money’s growth potential.

With this in mind, let’s look at five positive benefits of working with a trusted, qualified and regulated financial planning firm.

1. Helps maximise tax efficiency

As an expat you could reside in several different countries within the EU during your career. As a result, your income will be subject to different tax rules.

Working with a financial professional, like the Black Swan Capital team who specialise in helping expats means you’ll be working with someone who understands the different tax rules in Europe. This means that they can help ensure you’re as tax-efficient as possible, no matter where you’re living in the EU.

Furthermore, they will make sure that you are compliant with any tax requirements of your residency, and are protected under local financial regulations.

2. Helps you create the retirement you dream of

Retirement planning is a complicated business, yet as an expat it could be even more complex. Using a financial planner means you’ll be working with someone who fully understands pensions in the EU, and how they dovetail into your circumstances.

A key part of this is understanding the different pension systems in different European nations. For example, while some pension systems could favour you if you live in that country for a long period of time, it may be harmful to your long-term wealth if you’re a resident for a short period.

That’s why working with a trusted financial professional who understands the needs of expats could help to ensure your pension strategy helps, not hinders, your retirement aims. As a result, you’re more likely to achieve the lifestyle in retirement that you aspire to.

3. Keeps your wealth on track

Developing a long-term working relationship with a financial planning firm like Black Swan Capital means that you are not using a “transactional” approach to advice- getting support only when you ask for it.

If you have an ongoing relationship with a planner, they’ll regularly review your financial strategy to help ensure that your investments, pensions and wider wealth are all on track to meet your goals.

According to a study by Royal London, people with an ongoing working relationship with a financial planner are up to 50% better off than those who receive advice once.

4. Provides you with peace of mind

A financial planning firm’s role is to help you fully understand your wealth and circumstances, and ensure that every area of your financial strategy dovetails into the others. Instead of promoting a product, a firm  like Black Swan Capital considers the wider implications on all of your assets, investments and tax situation, and centrally, your goals and objectives.

This provides you with peace of mind that every area of your wealth is in hand, and being looked after by a professional who has your best interests at heart. Furthermore, they are always on hand whenever you need to talk to them.

According to Royal London’s research, a third (34%) of those questioned said that working with a financial planner also made them feel more confident about their financial plans.

5. Avoids a decision you later regret

While investing could expose your money to greater growth potential, it shouldn’t be something that keeps you awake at night. While investors should expect short-term downturns, stocks and shares typically increase in value over the longer term.

When downturns happen, it’s typically best to stay calm and wait for your investments to recover when the stock market bounces back. To demonstrate this you might want to consider the following illustration, which shows the MSCI Europe index between 31 January 2013 and 13 January 2023.

It tracks the performance of a basket of large and mid-cap companies over 15 countries in the eurozone.

Source: MSCI Europe

As you can see, while the index has broadly seen a significant increase in value during the 10 years, it has also seen major downturns along the way. If you had sold your investments during these downturns, you would have deprived it of the opportunity to recover and potentially increase in value later on.

As a financial planner can help you understand what is happening with the stock market and what your options are, you are less likely to make a decision you later regret. Please remember that past performance is no guarantee of future performance. We discussed investor regret here last year.

Additionally, as a market fall also presents an opportunity for investors, a financial planner may be able to help boost your money’s long-term growth potential during a downturn.

Get in touch

As specialists in helping expats in Europe, we would be happy to discuss how we could help you in 2023 and beyond. Please contact us on info@blackswancapital.euand we’d be happy to help.

Please note

This article is for information only. Please do not take action that is based on anything you read in this article until you have sought professional advice.

Investments carry risk. The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.

A pension is a long-term investment. The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Your pension income could also be affected by the interest rates at the time you take your benefits. The tax implications of pension withdrawals will be based on your individual circumstances, tax legislation and regulation, which are subject to change in the future.