Contributed by John E. Rice, CFA, CFP® Each winter, many Canadians consider living in the US instead of Canada. Some of them have been thinking about this for years and seriously consider all the aspects of this life changing event. Many with the means to do so may already be living in the US some or all of the winter months. As they get older, they start to think about where they want to reside. Due to age, travel between the two countries may get more difficult.
The biggest issues faced by Canadians that are contemplating becoming residents of the US are: immigration, health care, tax compliance, lifestyle, and emotional aspects of this decision. By far the biggest hurdles are the lifestyle and emotional considerations. There are many solutions for the immigration, health care, and tax compliance and these issues can be worked through in almost all cases.
Snowbirds that have already lived part of several years in the US will find the emotional and lifestyle changes much easier than Canadians that have only vacationed in the US but never lived in the US for extended periods of time. When they start to contemplate which country they want to live in when travel between the two becomes more difficult, they may decide they want to live in their home in the American Sunbelt instead of their colder Northern home. They can often identify an immigration option that allows them to become residents of the US and then can switch their tax residency and save money in future taxes without a significant impact on their lifestyle. The only change is that they stay in the US a little longer each year than Canada.
The lifestyle in the US is very similar to lifestyle in Canada. But the emotional aspects of moving away from their family and/or home country of Canada can be difficult for some. Many people who contemplate this decision have raised their children in Canada. Now they have grown children with families and grandchildren that have no plans to leave Canada. A move to the US may take them farther away from their families and they may not be able to see them as frequently.
For Canadians that have not lived in the US but are considering coming here, we usually recommend they spend some time in the US before making the decision to move here. For the most part, the lifestyle is very similar. But there are a lot of steps to take when changing residency and they should make sure they are comfortable with this change before making this decision.
Although we can assist clients with their immigration, health care, and tax issues, we are unable to provide them with solutions for the difficulties in transitioning away from their kids and grandkids. But we can often reassure them that if they follow a plan and become dual citizens of the US and Canada they can travel between the two countries as often as they like in the future. Canadians that decide to move to the US have to discuss the importance of living close to their kids and grandkids as part of their decision to move to the US.