Episode 76
Self-Invested Personal Pensions and Inheritance Tax: Why UK Pensions Are Moving Inside the IHT Net and Why You Don’t Need to Panic
In an era of political turmoil, rapid technological change, and shifting tax rules, internationally minded investors, especially expats, face a landscape that feels more uncertain than ever. Yet within that uncertainty are clear, practical steps you can take to protect your wealth, manage risk, and live well. When you’re a British expat or US-connected family navigating dual tax UK and US rules, even small misunderstandings can lead to outsized financial consequences. The difference between confident decision-making and costly mistakes often comes down to working with the right international advisor and having a clear long-term plan.
In this episode of Expat Wealth, Richard Taylor – dual UK/US citizen and Chartered Financial Planner – is joined by James Boyle – Lead Financial Planner at Plan First Wealth to unpack the real-world financial conversations happening behind the scenes with globally mobile families. As technology evolves and more people turn to artificial intelligence for quick answers, it’s becoming easier to find information, but harder to interpret it correctly. Tax language is nuanced. American tax reporting rules can carry severe penalties if misunderstood. For anyone moving to the US, moving to America, or building wealth while living internationally, context matters just as much as the rule itself.
You’ll hear insights on:
The Supreme Court’s recent ruling on Trump-era tariffs, the political fallout, and what all the uncertainty means for markets.
Growing anxiety around AI – shifting from pure optimism to a more mixed, sometimes fearful outlook – and how to stay invested and optimistic despite the noise.
Why the US is still likely to be the key engine for monetizing AI and human ingenuity, and why global diversification is still non‑negotiable.
A deep dive into the upcoming UK inheritance tax (IHT) changes on pensions (including SIPPs) from April 2027, and the potential strategy of using non‑UK situs assets (e.g., US ETFs) within Self-Invested Personal Pensions (SIPP).
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Expat Wealth is supported by Plan First Wealth. Plan First Wealth is a Registered Investment Advisor serving fellow expatriates and immigrants living across the US on matters such as retirement planning, investment management, tax planning and non-US asset management.
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Expat Wealth is affiliated with Plan First Wealth LLC, an SEC registered investment advisor. The views and opinions expressed in this program are those of the speakers and do not necessarily reflect the views or positions of Plan First Wealth.
Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Plan First Wealth does not provide any tax and/or legal advice and strongly recommends that listeners seek their own advice in these areas.
ABOUT RICHARD:
Richard Taylor is a British expat, dual citizen (UK & US). Originally from Bolton, he now lives in Greenwich, CT, where Plan First Wealth has its head office.
As the firm’s leader, Richard launched Taylor & Taylor, now Plan First Wealth, and continues to fuel the firm’s growth. Richard is a Chartered Financial Planner (UK – CII) in addition to holding the IMC (CFA UK) and Series 65 (US – FINRA).
Connect with Richard on LinkedIn
Richard Taylor, Founder of Plan First Wealth:
[00:00:00 – 00:00:13]
Let’s talk about the biggest news item I think in the last week or so, which is the Supreme Court walking back the Trump’s tariffs or saying the tariffs, the way he’s imposed tariffs was illegal. Wow.
James Boyle:
[00:00:13 – 00:00:33]
What feels like it in any other timeline would be a conclusion or an end state for the question. It seems to have opened up a lot more uncertainties. Right. The question of refunds is on top of everyone’s mind right now. Who gets it when and how. He responded by announcing more tariffs. Right. So he certainly sticking to the theme
Richard Taylor, Founder of Plan First Wealth:
[00:00:33 – 00:00:42]
and attacking the just justices personally. That was quite something. That was arguably not very presidential shock horror.
James Boyle:
[00:00:42 – 00:00:44]
That’s putting it as politely as possible.
Richard Taylor, Founder of Plan First Wealth:
[00:00:44 – 00:01:45]
Yeah. An episode recently ended with Tobias Gleed Owens where we talked about inheritance taxes coming to UK pensions, including SIPs from April 2027. That much we know. And this is going to affect a lot of expats with large sips. And there’s a lot of expats in America with large sips. And Tobias came on and he thinks there may be or he thinks there is potentially a way to avoid it by investing in non UK Citus investments. So for us, obviously it would be US ETF mutual funds. He believes that that should put the value of those assets outside of the scope of the UK inheritance tax. Now this could have serious, like serious savings for the heirs of British expats who got substantial sips, like tens, hundreds of thousands of pounds slash dollars. So this is unsurprisingly, generated quite a bit of interest from our clients and listeners. So I think we just wanted to
James Boyle:
[00:01:45 – 00:02:14]
touch on this for, you know, I know sometimes people get sick of us talking about tax, but it really does impact and influence every step of a financial plan. Right. Of an income plan, of a, of an investment plan. It is there always. So we always want to be diligent, Right. Vigilant, I should say diligent. And make sure that your T’s are crossed, your eyes are dotted and you’re looking ahead and. And really using that advanced tax plan that forward. Absolutely.
Richard Taylor, Founder of Plan First Wealth:
[00:02:15 – 00:03:27]
Welcome to Expat Wealth, a Plan first wealth podcast dedicated to helping ambitious expatriates in America and and Americans overseas thrive. I’m your host Richard Taylor and Plan first wealth is the business I founded and run today. And we work with successful expatriates, immigrants and internationally minded Americans to make the most of their opportunity and avoid the expat landmines. First, a quick disclaimer. While Plan First Wealth LLC is an SEC registered investment advisor, the views and opinions expressed in this program are those of the speakers and do not necessarily reflect the the views and positions of Plan First Wealth. Information presented is for educational purposes only. Now, if you aren’t already receiving our emails, please go to our website, planfirstwealth.com and sign up there. It’s free and you’ll be notified every time we drop a new episode and so much more. Okay, let’s get back to this week’s show. Welcome back to another episode of from the Trenches, the Expat wealth show, where my colleague James Boyle and I bring you behind the scenes at Plan first wealth as we build this business, as we work with our clients, and as we mud through life. And it certainly feels like I’m muddling through life this week. James, how about you?
James Boyle:
[00:03:27 – 00:03:36]
We’re. We’re muddling through February, let’s say. Right. We’re, we’re trying not to bring the February vibe, so to speak, into the episode, but it is a tough go right now.
Richard Taylor, Founder of Plan First Wealth:
[00:03:36 – 00:04:20]
I am so sick of snow. And I say this as someone who absolutely loves snow. I. Last week I was skiing with my 6 year old in Vermont and it was wonderful and magical. It was a real moment for me. I love skiing and I was with my kid for the first time doing something together where I wasn’t just chaperoning them and making sure they didn’t kill themselves. Although I was doing that, but we were actually skiing together. I wasn’t just, you know, just hovering over them. It was amazing. It was incredible. But I needed him to go back to school this week. We’ve had so much snow. School was off for two days and now more snow this morning. It was treacherous out there. I am. We are so over it over here.
James Boyle:
[00:04:20 – 00:04:33]
Horrible. It is horrible. February, historically, is not a great time. I’m sure we have listeners all over. Right. But if you’re in the northeast of the U.S. we have been walloped this year and repeatedly. We can’t catch a break.
Richard Taylor, Founder of Plan First Wealth:
[00:04:33 – 00:04:56]
I want to give people some concept of what this is like because I’ve never experienced anything like this. And I’ve been here 10 years and we don’t get anything like this in the uk. The Boston Globe didn’t go to print for the first time in 153 years. Long wait. Would it been sun? It would have been Monday going into. Wait, when did it really snow? Massively? Oh, for Sunday going into Monday.
James Boyle:
[00:04:56 – 00:04:57]
Sunday and Monday.
Richard Taylor, Founder of Plan First Wealth:
[00:04:57 – 00:05:38]
Yeah. Okay, so it didn’t on Monday. They didn’t, they didn’t print for the first time in 153 years. There was one town in Massachusetts called Warwick, or Warwick, as they probably say. 36 inches of snow, 3ft. I don’t know how you cope with that. We got 16 or 17 here in Greenwich, and it’s nothing like I’ve seen. It was just a constant day of clearing it up. There was so much snow. There’s still so much snow. And there were parts of New Jersey and Connecticut and Long island that got 30 inches. That’s 2 1/2ft. I just can’t comprehend what 3, 2 1/2, 3 foot of snow is like. 16, 17 inches was enough.
James Boyle:
[00:05:39 – 00:05:43]
It makes you want to just duck under the covers and not leave.
Richard Taylor, Founder of Plan First Wealth:
[00:05:43 – 00:05:43]
It’s.
James Boyle:
[00:05:43 – 00:05:46]
It’s awful. Especially like you said, the repeated. Yeah.
Richard Taylor, Founder of Plan First Wealth:
[00:05:46 – 00:06:04]
When you got two small kids who just tear up your house who you have to feed. Oh, man. It’s been a trying few days. It really has. But can you believe that the, the newspaper. 153 years. The first time I, I. That that start blew me away.
James Boyle:
[00:06:04 – 00:06:20]
That’s horrible. It’s just. I think everyone is sick of it. We have to hope they are. We’re wrapping up February. I think this episode will be out next week. Right. Beginning of March. I am so hopeful, praying, whatever you want to say, that that spring is on its way because this is not fun.
Richard Taylor, Founder of Plan First Wealth:
[00:06:20 – 00:06:26]
Well, the good news is, I don’t know about where you are, but there’s more snow scheduled for us next week, so. Yeah. Okay. Right.
James Boyle:
[00:06:28 – 00:06:30]
As you might say for the. For the episode. Right.
Richard Taylor, Founder of Plan First Wealth:
[00:06:30 – 00:06:50]
Oh, I’m just getting warmed up. What are you talking about? I’m just getting started. Well, let’s talk about the biggest news item I think in the last week or so, which is the Supreme Court walking back the Trump’s tariffs or the way he’s imposed tariffs was illegal. Wow.
James Boyle:
[00:06:50 – 00:07:13]
And what feels like it in any other timeline would be a conclusion or, or an end state for the. For the question. It seems to have opened up a lot more uncertainties. Right. The question of refunds is on top of everyone’s mind right now. Who gets it when and how. He responded by announcing more tariffs. Right. So he’s certainly sticking to the theme
Richard Taylor, Founder of Plan First Wealth:
[00:07:14 – 00:07:24]
and attack the just justices personally. That was quite something. That was arguably not very presidential shock horror.
James Boyle:
[00:07:24 – 00:07:25]
That’s putting it as politely as possible.
Richard Taylor, Founder of Plan First Wealth:
[00:07:26 – 00:07:49]
Yeah. Although last night was the State of the Union address. I didn’t watch it, but I read about it this morning and it seems that he’s walked back or, or toned down some. Some of the opprobrium. Shook hands with the justices on the. That were in attendance on the way in. Thank goodness. Thank goodness. But, yeah, who knows what next. It was quite a reaction.
James Boyle:
[00:07:50 – 00:08:14]
Yeah. I think we always talk about this idea that markets in general don’t like uncertainty. Right. And we’ve certainly had a lot of that over the last year or so. Do you see any way away from that? I just can’t imagine any place we get to within the next six months or in the short term where we feel like we know what’s happening and what’s around the next corner. It just feels.
Richard Taylor, Founder of Plan First Wealth:
[00:08:14 – 00:08:14]
Do we ever know?
James Boyle:
[00:08:14 – 00:08:15]
No, probably not.
Richard Taylor, Founder of Plan First Wealth:
[00:08:15 – 00:08:25]
Obviously that’s massively heightened now. But I tell you, if you ever do feel that you have a tight grip on what’s going on in you, then you deluding yourself.
James Boyle:
[00:08:25 – 00:08:26]
Yeah, yeah.
Richard Taylor, Founder of Plan First Wealth:
[00:08:26 – 00:08:49]
There’s just too, Too much going on and there’s too many unknowns and too many can’t possibly know. No one knows what’s. Yeah, we can, you know, we can have faith. The further you look out, I think the. The more conf. Be. But in the moment. But that I’m. But. And I stand by that. But I do also agree with what you’re saying is particularly chaotic right now.
James Boyle:
[00:08:50 – 00:09:09]
And. And sentiment, certainly among consumers is in the absolute dumps right now. It. I don’t think anyone feels very confident. But to your point, what kind of actionable advice does that lead to? Right. It’s one thing to feel uncertain or feel, you know, confused or worried. What can we do about it? Or what can we discuss?
Richard Taylor, Founder of Plan First Wealth:
[00:09:10 – 00:09:13]
I do think a lot of that news is. Is AI driven fears.
James Boyle:
[00:09:13 – 00:09:13]
Yeah.
Richard Taylor, Founder of Plan First Wealth:
[00:09:13 – 00:09:14]
Do you hear about this blog post
James Boyle:
[00:09:14 – 00:09:17]
that went viral I just read about this morning?
Richard Taylor, Founder of Plan First Wealth:
[00:09:17 – 00:09:38]
Yeah, yeah, yeah, I read about that. I actually fell asleep reading it last night. It’s pretty dire. It’s all hypothetical, though. But I, I think people are really, really on edge about AI, what it means for the immediate term. I think we were both excited what this could mean, but also kind of fearful.
James Boyle:
[00:09:39 – 00:09:51]
It does feel like, and this is purely anecdotal. Right. But it feels like that early stage optimism in 2022, 2023, maybe 2024 has shifted pretty markedly. Right.
Richard Taylor, Founder of Plan First Wealth:
[00:09:51 – 00:09:52]
Yes.
James Boyle:
[00:09:52 – 00:10:44]
From optimism to. Okay, what does this actually mean in the short to medium term? And it’s right. That blog was a piece of fiction, let’s not lie. Could it happen? Obviously. But it’s pure speculation. Back to this idea of optimism. Even when it’s difficult to hold those views, it is important to understand that human ingenuity and the response to these things try to hold out hope and try to understand that any kind of technological improvement comes with its bumps and disruptions, as the term is known on the street in Palo Alto. You have to hope that the human spirit, human ingenuity, persistence, drive will see us through. Right. And things might look different, but we certainly don’t want our audience feeling hopeless.
Richard Taylor, Founder of Plan First Wealth:
[00:10:46 – 00:11:45]
I actually think, I try to agree with that entirely. And I actually think the best proponents of that is America. And I know there’s a lot of chat about America being overvalued or historically high valued and dependent on the behemoths, although there’s a rotation going on there. Absolutely. But I think America has proven itself over last century to be the singular best country at harnessing human ingenuity for profit that can be taken to excess. And it’s not all good yet, but broad strokes. That’s why I fundamentally still think America is the best place to invest for the next. Yeah, for the long term, no idea what’s going to happen in the short term. But for the long term, I still think the countries that will harness this, the best, will find a way to make themselves and people, everyone around them and the country and society richer will be America. There will be massive inequality. That’s massive. That is such a problem that needs to be dealt with. I do think that. But the action is in America still, I think.
James Boyle:
[00:11:45 – 00:12:09]
And importantly, not investing exclusively in the U.S. right. We, we. Well, we believe that, or I do anyway, US is a powerhouse and certainly has been. When that narrative changes, as it did in 2025 and into 2026, when ex U S is outstripping, using the S and P as a shorthand, you know, orders of magnitude. There’s a reason to be diversified, of course.
Richard Taylor, Founder of Plan First Wealth:
[00:12:09 – 00:12:45]
Sorry. That absolutely goes without saying. And I’m not for one second advocating all America. But what the problem, the narrative is always so extreme, isn’t it? It’s the last 15 years, nothing but America, and suddenly it changes on a diamond. Everyone’s shifting into the rest of the world. And I’m not, I’m not advocating for that at all. I’m advocating for always being diversified and not like suddenly declaring, right, we’re finished with America, let’s do Europe, finishing Europe, let’s go back to America. Not, not at all. But America has been on an absolute tear. But I still think this is where the, the, the action is in terms of AI and maximizing that potential.
James Boyle:
[00:12:46 – 00:12:47]
Yeah, let’s hope so.
Richard Taylor, Founder of Plan First Wealth:
[00:12:47 – 00:13:17]
Yes, let’s hope so. We have a new Fed chairman incoming as well. That’s an interesting. No, I don’t think anyone’s surprised. I don’t think it’s necessarily a bad pick. Stephen, Stephen Walsh, he seems to have the bona fides. He’s. I don’t think he’s a pure political hack like some of the others who have been suggested. So I’ll be kind of glad. I think Pal’s been a great Fed chairman, but there’s so much circus around him now.
James Boyle:
[00:13:17 – 00:13:17]
Yeah, yeah.
Richard Taylor, Founder of Plan First Wealth:
[00:13:18 – 00:13:35]
So much controversy. Not his doing. I don’t. I think he’s done a great job. But. But it’ll be as long as this guy doesn’t turn into a political hack, doesn’t turn into just a, an, an act like a lap dog willing to do whatever the boss wants, then yeah, I think hopefully that could be a good call.
James Boyle:
[00:13:36 – 00:14:12]
Isn’t it funny we talk about the sentiment around AI Right. We feel that shift or certainly in the media. Same thing with the Fed. Right. Maybe not necessarily negative, but in 2025 the Fed was a dominant news story again and again and again. Right. And in some ways that’s not the most forward thinking position. Right. I’m sure Federal Reserve officials would rather be somewhat in the background. Right. And it shouldn’t be this political circus like it’s been. So I can absolutely echo the feeling that there will be some sense of relief that that continues. Right. That there is a functioning.
Richard Taylor, Founder of Plan First Wealth:
[00:14:14 – 00:14:20]
Absolutely. Although I would say the Fed has changed. Years ago you didn’t hear from the Fed at all.
James Boyle:
[00:14:20 – 00:14:20]
Yeah.
Richard Taylor, Founder of Plan First Wealth:
[00:14:20 – 00:14:42]
Then, then you had the taciturn Greenspan and I think this was kind of before my time, but I believe trying to decipher what he said was an art form in itself. And then we’ve had Bernanke and Janet Yellen and now we have the very plain speaking Jim Powell, but all the other Fed chairs are out there talking
James Boyle:
[00:14:42 – 00:14:44]
and, and all the governors.
Richard Taylor, Founder of Plan First Wealth:
[00:14:44 – 00:14:51]
Yeah, there’s, it’s, I think it’s a very different, a very different beast to what it was. And I don’t know if that’s a good thing or a bad thing, honestly.
James Boyle:
[00:14:51 – 00:15:20]
And is that supplier demand? Because I think there’s, there’s something to be said about a media that once they know these stories get clicks. Right. Some governor in Ohio is saying something about where he sees rates to be in six months or nine months. Does it mean anything in the moment? No. Does it get eyeballs? Absolutely. Is it useful? Probably not, frankly. But it is something that is certainly different than it was 20 years ago. You never heard from Fed governors and that was by Design.
Richard Taylor, Founder of Plan First Wealth:
[00:15:21 – 00:17:08]
Yeah, yeah. Okay. So, interesting times, right? Should we just talk quickly about the last. Well, not the last episode. An episode recently ended with Tobias Gleed Owens where we talked about inheritance taxes coming to UK pensions, including SIPs from April 2027. That much we know. And this is going to affect a lot of expats with large sips. And there’s a lot of expats in America with large sips. And Tobias came on and he thinks there may be or he thinks there is potentially a way to avoid it by investing in non UK situs investments. So for us, obviously that would be US ETF mutual funds. He believes that that should put the value of those assets outside of the scope of the UK inheritance tax. Now this could have serious, serious savings for the heirs of British expats who got substantial sips, like tens, hundreds of thousands of pounds SL dollars. So this is unsurprisingly, generated quite a bit of interest from our clients and listeners. This is one person we’ve had on talk about this. I’ve not had this corroborated by anyone else. I’ve also, I’ve got no reason to doubt it. But we don’t even, we don’t even have the final rules yet. The inheritance tax on UK pensions doesn’t come in force until April 2027. So I don’t think there’s any massive urgency, anyone. So we’ve, we’ve received quite a few people reaching out to us about this and I think our message has been like, we’re watching this, we’re putting out feelers to the different pension providers, trying to understand what their positions are, what their options are. There’s no action to take right now, I don’t think. But we’re looking into it, we’re working on it, we’re seeing how this evolves and develops.
James Boyle:
[00:17:08 – 00:17:52]
There’s. Yes, yes, we’ve gotten a lot of interest on this and questions and, and you know, people kind of scrambling because it is a massive shift, right. For virtually forever, pensions didn’t fall under IHT and now they will. To our understanding of the rules, it does kind of dovetail into something that we call income planning. Right. When we think about segueing from an accumulation phase from working and earning an income into now distribution. Right. When you’re going to start taking withdrawals from your investments for a long time, we’ve taken the position that if you’re in the us, your non US assets likely should be drawn down on first. Right. A SIP is a great example of that. For a lot of reasons.
Richard Taylor, Founder of Plan First Wealth:
[00:17:52 – 00:17:52]
Right.
James Boyle:
[00:17:52 – 00:18:17]
For reporting complexity, for tax questions. Usually it just made sense to draw those assets first, simplify your financial life that way. This in my mind is even more credence to that approach to potentially look at drawing down your SIP first rather than looking at US or domestic investments. Certainly that’s absolutely. That’s a blunt tool.
Richard Taylor, Founder of Plan First Wealth:
[00:18:17 – 00:18:17]
Right.
James Boyle:
[00:18:17 – 00:18:19]
But. But that’s one way to mitigate some of that concern.
Richard Taylor, Founder of Plan First Wealth:
[00:18:19 – 00:18:35]
But we did also have clients who had substantial assets in SIPs, or we do have clients who’ve got substantial assets in SIPs who were choosing to take a different route, which was to leave them untouched because of gross roll up, but also because they were outside the UK inheritance tax net.
James Boyle:
[00:18:35 – 00:18:36]
Yep.
Richard Taylor, Founder of Plan First Wealth:
[00:18:36 – 00:18:41]
So for those clients, the particularly large ones, the calculus has shifted somewhat.
James Boyle:
[00:18:41 – 00:19:32]
Yeah, it’s one of those things. I had a conversation recently with, with, with a client. I would expect not, you know, everyone here in my accent, not being familiar with the UK legal system certainly, and how this might get challenged by HMRC and the IHT collection. I would imagine there’s going to be some pretty significant contests in the courts or determinations of what is covered and what’s not is non UK domiciled assets. Does it look through the SIP wrapper, all the things that we discussed on that episode. If you haven’t listened to it, I certainly recommend it and I’m eager to see clarity on that, to get an understanding of where the field lays. Because like you say, for someone with significant assets in these vehicles, and it is a charge that we had never anticipated. Right. That is a very real potential threat.
Richard Taylor, Founder of Plan First Wealth:
[00:19:32 – 00:20:40]
Now Tobias seemed pretty confident that it was supported, you know, it wasn’t, it wasn’t just spun out of whole cloth like it was. It very much fit within the spirit of the rules and UK Citus assets and non UK scientists assets. So you seem pretty confident in it. I think a key, a key element will be getting the buy in getting the, getting the agreement of the SIP trustees because on death is a SIP trustees who will also report back to hmrc. And Tobias was very clear, you want your, the, the whoever’s dealing with the executor of your, your estate will be reporting to HMRC and the, the trustee of the SIP will be reporting to hmrc. And you want them reporting the same thing. You want to be on the same page and if you’re not, that will be a problem. So I think that’s going to be critical. So if we can get the. But then that’s one of the jobs we’re doing, right? Now is we’re reaching out to the trustees, trying to understand their position and their take and go from there. But we have time.
James Boyle:
[00:20:40 – 00:20:49]
Yeah, I can hear the questions flooding in right now. Right. The partners you work with, the platforms, you work with, trustees, custodians, what is their position? We don’t know yet.
Richard Taylor, Founder of Plan First Wealth:
[00:20:49 – 00:20:50]
Right.
James Boyle:
[00:20:50 – 00:20:55]
But it’s something we’re actively working on and will only grow in importance, like you say.
Richard Taylor, Founder of Plan First Wealth:
[00:20:55 – 00:22:03]
Yeah. Cool. Right. I’m excited to announce that Expat wealth has its first sponsor, the Global Financial Planning Institute. The GFPI exists to provide education, community tools, resources and ongoing research for financial planners and other advanced financial professionals working with international and cross border clients in the US And Americans abroad. I’m a GFP Institute fellow and I’ve put all our employees through their GFPI programs when they join us. I’ve met some great people, I’ve learned a ton. It’s a genuine community of internationally minded folk doing their best to serve their clients properly and critically sharing what they know in the oftentimes challenging and ambiguous US Cross border environment. And as anyone in this sector will tell you, you’re always learning. So if you work with international clients and or Americans abroad, or if this is an area you’re to get into, check out the gfpi@www.gfp.in stute you will be glad you did and I hope to see you there soon. My notepad’s closed on me. What have we got next?
James Boyle:
[00:22:03 – 00:22:06]
Did you hear my attempt at a segue earlier, bringing up income planning?
Richard Taylor, Founder of Plan First Wealth:
[00:22:06 – 00:22:10]
Oh no. Yeah, I did just turn the car around. Did I?
James Boyle:
[00:22:13 – 00:23:37]
This is a major topic that I don’t think, you know, we always think about what we, we want to cover, what questions we get from, from clients or prospective clients, topics that are top of mind. This is something we have not covered yet in the podcast, to my knowledge really at all. And it’s what we call income planning, Right. That very notion that I just mentioned, going from what we call accumulation to decumulation, right? So accumulation, you’re working, you have an income, you have earnings coming in, you’re saving into pensions or investment accounts. That shifts obviously when you step away from work, when that income stops. A pretty critical point when we think about what does financial planning mean? What does retirement planning mean? Is income planning is determining the path and plan for how you generate income. You derive income from this nest egg you’ve built up throughout your working career. It is critical and if you get it wrong, you either in the least worst case scenarios, you’re Leaving money on the table, right. In the worst case scenarios, you’re, you’re potentially derailing what would have been a successful retirement. It’s not something that we always talk about immediately, right? We, we tend to say two to five years maybe, and five years might be long before stepping away from work to get this income plan into place. But it’s something, as you approach retirement, you should be thinking about and should be concocting a plan for.
Richard Taylor, Founder of Plan First Wealth:
[00:23:37 – 00:26:23]
Well, can I just put a stake in the ground here and, and make something really clear that you touched on? There are two, broadly, there are two fate phases in someone’s financial life, accumulation and decumulation. And to be clear, most financial planners in my experience exist to help people with the decumulation. And I stress that, not family offices. That’s a whole different thing. Once you get above a certain level of wealth, there’s a different calculus going on. But for most of us regular folk, you have accumulation, then you have decumulation. And financial advisors can help a lot in accumulation, but they really exist for decumulation. And the reason I bring this up is because a lot of people are in the accumulation phase, the working phase. You’re in your 20s, 30s, even 40s, you’re working hard, you’re saving, you’ve got your 401k, your 529s, you’re worried about paying off your mortgage, you’re worried about putting your kids through college. And I think all you’re saving is, or hopefully is automated going into low cost index funds. And a lot of people think, why would I ever need a financial advisor? Like, this is easy. Yeah, it is. And look, sometimes you, you could definitely benefit from the, from a financial advisor. The, the benefit. There’s, there’s true value to know if you’re on track, because if you’re off track and you leave it too late, there’s no recovery. Whereas if you’re off track and you have a decade or two to get to catch up, there’s a lot that can be done. And too often people come to us and say, right, I’m on the cusp of retirement, what can I do? And you’re like, oh, well, we have got those fewer levers that we can pull. And that can often lead to some difficult conversations, working longer, reducing life expectations. But in general, accumulation is relatively straightforward and people often scratch their head thinking, what would I need a financial advisor for? Why would I pay someone to help me with this? And although I will just caveat that, as always, I know you’re all Sick of hearing me say this, but if you’re cross border, you need a good tax advice. Absolutely. Have a good cross border tax person do your returns, please, please, please. It will save you oodles of stress and likely some real hard currency in the long run. But decumulation is very different. When you stop earning, when, when you stop having a regular income stream or two that pays your bills, that gives you that financial security. That means that when the market goes up and down, you don’t freak out because your whole you’re not living off that pot of money, worrying about making that thing last, that amalgamation of assets you got last for 30, 40 years of relentlessly rising prices. That is stressful, it is scary, it is hard, it’s fraught with dangers.
James Boyle:
[00:26:24 – 00:26:27]
It’s an enormous psychological shift, right? It’s.
Richard Taylor, Founder of Plan First Wealth:
[00:26:27 – 00:26:30]
It’s enormous psychological shift and compounded by
James Boyle:
[00:26:30 – 00:27:30]
the life’s life change itself, right. You know, you see those charts every once in a while that are like most stressful occurrences, events in someone’s life, changing jobs, changing house, moving houses, death of parents, that kind of thing. Snowing, snowing, snow, snow, snow. February in general, February. Retirement is one of those major changes. It’s a pretty significant shift to go from a structured routine, work challenges every day, problems to solve, to potentially not that, to something very different. So you have this lifestyle change, if you will, lifestyle shift. And now you’re also completely shifting how you’re handling your finances, how that nest egg, like you said, needs to now generate that income, right. Needs to provide a lifestyle that you hope to continue throughout retirement without the fear of running out of it. Right. Without running out of money. It’s two enormous shifts that echo each other, that amplify each other.
Richard Taylor, Founder of Plan First Wealth:
[00:27:31 – 00:27:39]
Yeah. So what do we want to say about what we do? How are we approaching complaining? I think there’s a systematic system.
James Boyle:
[00:27:39 – 00:28:54]
Yeah, There’s a lot that could be said here if we can keep it high level. We look at a couple different things. Number one, a cash buffer, right. With our clients, we’re looking at between one to two years of living expenses, ideally depending where you fall from a risk tolerance perspective. And then we look at order of operations, right, if you will, from which accounts are we drawing from first and why and discussing the pros and cons of doing each of those things. I hinted at earlier the idea of drawing down from non US assets first, right. For a lot of reasons. Simplifying your finances being one of them, your taxes, potentially. Now this IHT issue as well, right. So if I can sketch out Kind of basics of the income plan that we are building for our clients. It’s some cash buffer, a war chest. Right. That’s going to provide income for the next 12 to 24 months. Then it’s an order of operations. Might look like for a lot of our audience. Drawing down your SIP. Right. First, then we start to look at U.S. accounts. Taxable brokerage usually going to be the first stop there because there’s tax drag on those accounts.
Richard Taylor, Founder of Plan First Wealth:
[00:28:54 – 00:28:55]
Right.
James Boyle:
[00:28:55 – 00:28:58]
You’re getting taxed every year on dividends, capital gains, all those things.
Richard Taylor, Founder of Plan First Wealth:
[00:28:59 – 00:29:01]
Although we do try to reduce that with tax loss harvesting.
James Boyle:
[00:29:01 – 00:29:17]
Yep, yep. Absolutely. There’s a lot working in sync with this. Beyond that then typically it will be a pre tax account like an IRA or 401k and then finally your Roth IRA. There’s a lot of nuance there. Right. And these plans are.
Richard Taylor, Founder of Plan First Wealth:
[00:29:17 – 00:29:55]
And along the way we’ll likely depending on when you retire and if you’re still working, we’ll look to do some Roth conversions early on, build up that Roth bucket and get that growing tax free and then later tax free withdrawals as well. We’ll be doing tax loss harvesting along the way and depending on your portfolio and account size, maybe look to do some direct indexing to really juice that tax loss harvesting approach. So we really do have an eye on taxes as well. So there’s the order of operations, there’s the continual monitoring of this to make sure your, your expenses are in line with what we expect and if not what we do about that. But and also that you’re not going to run out of money.
James Boyle:
[00:29:55 – 00:29:55]
Yep.
Richard Taylor, Founder of Plan First Wealth:
[00:29:55 – 00:30:07]
Yeah. Simply put, like projecting forward all the time, making sure that no matter what happens, you’re going to be okay and you know you’re going to be okay. And then you can live confidently knowing you’re going to be okay and your way of life is protected. That’s massively important.
James Boyle:
[00:30:08 – 00:30:25]
That idea of not running out of money. Then there’s the flip side. Right. Who a lot of our clients are in this position, I’m sure a lot of the audience where we also want you to have the confidence to live the lifestyle you want and that’s supportable by the plan. We don’t want you to leave life on the table. Right. Critical piece.
Richard Taylor, Founder of Plan First Wealth:
[00:30:25 – 00:31:53]
Yeah. Yes. We will encourage our clients to spend when they can to do that trip, to buy that car, to help the kids out on the housing ladder, whatever it is. We want people to, to live their lives and a lot throughout this Tax, tax, tax. Now at that point I know I’m going about tax all the time. A lot of my bleating is about urging people who are in the accumulation phase to work the cross border tax advisor to get into and stay in compliance. What we’re talking about here is a bit different. By the time we get to decumulation, hopefully if you’re working with us, you’re in compliance. But now the taxes are, I presume they’ve been a massive part of your life so far, but now are likely to be the single biggest line item as well, still in retirement. So we want to do everything we can to minimize that through tax loss harvesting, through Roth conversions, but just through regular ongoing annual maintenance and checks. And this is where we really. I’m going to talk about a service we’ve introduced in the last couple of years which is where we will work with select. We will work with select tax advisors to do a level of tax planning for our decumulation clients to make sure they remain in compliance. They don’t have that risk hanging over them, which some people do. But also then to minimize the tax bill they have to pay each and every year in retirement. So they get to keep more and enjoy more and ultimately maybe pass more on to their family.
James Boyle:
[00:31:53 – 00:32:07]
Absolutely. It’s almost a layer, you know, a lens of tax optimization, right. That sort of overlays on all of these moving parts. And I know, you know we just ran through that in 10 minutes, right? We threw out a lot of acronyms there.
Richard Taylor, Founder of Plan First Wealth:
[00:32:07 – 00:33:15]
James, I just want to expand on this for one more second. And the reason is because everyone talks about their financial advisor and their tax advisor, you know, working in cahoots, having a relationship, but it never happens. Yeah, it never happens. I don’t even know if it happens at these firms where they have it in house. Maybe it does. But in my experience, even when the tax advice and the financial advisor know each other, there’s no real coordination, there’s no real planning. And it’s wound me up for years so that what we’ve instigated is when our clients work with these particular cross border firms, we will pay separately for a level of planning. And we get together with the client, with the tax advisor and we go through everything and, and clients get to see, oh, my financial advisor and my tax advisor here, my financial planner, my tax advisor, they are have a relationship, they are talking about me, they are planning about me. It is a strategic planning, symbiotic relationship with the objective one, true compliance of making sure you pay as little tax as possible. And I think as, as rudimentary as simple as that sounds, I think it’s pretty unique.
James Boyle:
[00:33:16 – 00:33:55]
It’s missing almost always. Yeah, we always find that and we’re doing everything we can to F that right. To fill that gap because it is so critical like you said earlier. You know, I know sometimes people get sick of us talking about tax but it really does impact and influence every step of, of a financial plan. Right. Of an income plan, of, of, of a, of an investment plan. It is there always. So we always want to be vigilant, I should say diligent, and make sure that your T’s are crossed, your I’s are dotted and you’re looking ahead and, and really using that advanced tax planning, that forward tax planning. Absolutely.
Richard Taylor, Founder of Plan First Wealth:
[00:33:55 – 00:34:01]
We want to be proactive. Exactly. Forward looking tax planning. Yeah. Jolly good. Sorry I interrupted you mid flow there.
James Boyle:
[00:34:01 – 00:34:04]
I’m sure that I. Whatever I was going to say was.
Richard Taylor, Founder of Plan First Wealth:
[00:34:04 – 00:34:05]
You were. You.
James Boyle:
[00:34:05 – 00:34:09]
You had a better point. So it’s completely flew out of my mind now.
Richard Taylor, Founder of Plan First Wealth:
[00:34:10 – 00:34:14]
Oh. Tell you what then. Let’s. Do we have anything else to add on that or can we wrap up?
James Boyle:
[00:34:14 – 00:34:16]
I think, I think that’s. We can wrap that up.
Richard Taylor, Founder of Plan First Wealth:
[00:34:16 – 00:34:57]
Okay, well cool. Let’s, let’s. We have a development for our firm. Development. We hired Canny in the first in February. We, we have James now has a client servicing associate who actually is shaping up to be a whole lot more which is great. But he’s been brought on board to help James with his existing clients and his new clients which is growing. Fantastic. Well, the best start to new business ever in our. I think this is our eighth year, maybe our ninth. So that’s great news. And we brought Connie on to help us grow, both bringing on clients. But as I mentioned, I think he’s going to do a bit more which is, which is great. We’re absolutely in the right direction.
James Boyle:
[00:34:57 – 00:35:11]
We are, we are so happy to have Connie on board. We’ve stuck to the global, the cross border theme. He actually has experience working at an Australian financial planning firm and he’s dived right in. So we’re really happy to have him on the team.
Richard Taylor, Founder of Plan First Wealth:
[00:35:12 – 00:35:16]
All right, wrap up. Anything else to add before we can move on to pick a mix?
James Boyle:
[00:35:17 – 00:35:18]
Let’s do it.
Richard Taylor, Founder of Plan First Wealth:
[00:35:19 – 00:35:23]
Okay, well let you go first. Tell me what you. What’s this will be showing?
James Boyle:
[00:35:24 – 00:36:02]
This will be a good, a good segue from our previous episode because I’m actually reading a recommendation by one of our hosts, 1929 by Andrew Ralsorkin about the depression obviously in the year 2029 with the stock market falling about halfway through, really enjoying. And you could tell he’s good, he’s a great writer. And do you get the sense that this is written for the screen? And I don’t mean that in a pejorative way. It’s written very cinematically and I would be shocked if there is not a Hollywood movie or, or an HBO limited series of this in a couple years.
Richard Taylor, Founder of Plan First Wealth:
[00:36:02 – 00:36:12]
I didn’t, I didn’t think of that. But I’m sure I’d love to see if, if that comes out on hbo, I am. Will be the first to watch it. Yeah. Did you ever read Too Big to Fail? His first.
James Boyle:
[00:36:12 – 00:36:17]
Yeah, yeah. I mean this was years ago, but yeah, yeah, yeah. They made that into a movie, right?
Richard Taylor, Founder of Plan First Wealth:
[00:36:18 – 00:36:47]
Yeah, yeah, yeah. I can’t remember it, but yeah. Very, very, very good. Very. I’m glad you’re reading that. Yeah, I’m still reading the if Only They Spoke a Different Language book about Trump’s America by a British journalist. It’s okay, it’s good. I’ve enjoyed it. I’m ready for it to end now. So I’ve got myself, I’ve got a Genghis Khan book lined up. Let’s get started on that. But I’m so knackered at the mom time I go to sleep. I get about one page in and I fall asleep reading every single night. So it’s excruciatingly slow.
James Boyle:
[00:36:47 – 00:37:13]
I have to tell you. I usually, or I used to read every night without fail. I have fallen. I don’t know if this is a bad habit or not, but I’ve been falling asleep to podcasts now which is, which is cut into my reading. I still read in the mornings, but I have found the same thing where now I don’t have two little kids to run after, but it’s still. Still tired. At the end of the long day, I will listen to 60 seconds of a podcast and I’m asleep. I’m out.
Richard Taylor, Founder of Plan First Wealth:
[00:37:13 – 00:37:15]
Like what happens to your earbuds though?
James Boyle:
[00:37:15 – 00:37:25]
I’m in the bed for some reason it stays. And I think also sometimes I’ll kind of wake up and take it out, stick it on a nightstand. But yeah, I’ve never, I’ve never actually lost one yet.
Richard Taylor, Founder of Plan First Wealth:
[00:37:25 – 00:37:26]
What are you listening to at night?
James Boyle:
[00:37:27 – 00:37:37]
Usually it’s like pretty light hearted comedy podcast comedians kind of chatting. It’s. It’s nothing ever. I can’t listen to any kind of news certainly.
Richard Taylor, Founder of Plan First Wealth:
[00:37:37 – 00:37:40]
Do you, do you, do you follow the Theo von Podcast?
James Boyle:
[00:37:40 – 00:37:44]
No, no, that’s, that’s not for me.
Richard Taylor, Founder of Plan First Wealth:
[00:37:44 – 00:37:46]
He’s he strikes me as quite funny.
James Boyle:
[00:37:46 – 00:37:47]
Yeah.
Richard Taylor, Founder of Plan First Wealth:
[00:37:47 – 00:37:52]
But some of the, some of the people on there. It’s not my cup of tea, not
James Boyle:
[00:37:52 – 00:38:17]
my, not my ecosystem necessarily for our listeners. No, I think I’ve talked about them many times. There’s a podcast called Off Menu in the UK that’s enormous. It’s hosted by James A. Caster stand up comedian, another comedian called Ed Gamble. It is fantastic. And the best episodes are when it’s another British comedian that you could tell they’re really good buddies with and they just. Yeah, love it. I’ve been, I’ve been listening to that for years.
Richard Taylor, Founder of Plan First Wealth:
[00:38:17 – 00:38:19]
Wait, what I need to, what’s that called?
James Boyle:
[00:38:19 – 00:38:20]
It’s called Off Menu.
Richard Taylor, Founder of Plan First Wealth:
[00:38:21 – 00:38:44]
Off Menu. Okay. Well I, I, my, I’m my recommendation podcast is a goal hanger podcast called the only way is politics. Oh sorry. The rest is politics in us. Anti Scaramucci and Katie K. I, I find I, I enjoy listening to it and it’s a good update. What’s going on Off Menu with it. Right. I’m following this into this. I need some light. My podcasts are all heavy.
James Boyle:
[00:38:45 – 00:39:19]
Speaking of, I’ll shout another one. It’s called what did you do yesterday? It’s, it’s similar story Dublin based comedian Dan Doherty and there’s a British sports commentator whose name Max, Max Rushton I think his name is. I don’t know him, but he’s got two young kids and they literally just go through their day, you know, hour by hour. I would imagine you, you, you’d either feel a lot of empathy for them or have flashbacks like PTSD flashbacks. But another good both to follow. I could do with some like podcasting
Richard Taylor, Founder of Plan First Wealth:
[00:39:19 – 00:39:25]
minds old economic investment news which is politics and history.
James Boyle:
[00:39:26 – 00:39:40]
Yeah, I see. I have trouble turning my brain off after that. But more power to you. Yeah. Anything on TV worth watching Industry we’ve kept up with. I know. I think you bailed out of that one.
Richard Taylor, Founder of Plan First Wealth:
[00:39:40 – 00:39:42]
This is an HBO on the second, second season.
James Boyle:
[00:39:43 – 00:40:10]
Yeah. I think it’s an HBO BBC co production type thing set in London. Completely over the top. Completely bombastic. But entertaining. Very entertaining. The show has evolved quite a bit. They brought on Game of Thrones actor played Jon Snow. He’s, he’s kind of like one of the main leads now. Like I said, Kit Harrington. That’s it. That’s it. Very over the top.
Richard Taylor, Founder of Plan First Wealth:
[00:40:10 – 00:40:13]
Nothing Jon Snow, you know, nothing Jon Snow.
James Boyle:
[00:40:13 – 00:40:25]
He’s very good in the role. He plays this kind of like down and out, sort of mentally unstable Nepo baby inheritor, sort of upper Class. Yeah. British Lordling. So.
Richard Taylor, Founder of Plan First Wealth:
[00:40:26 – 00:40:29]
Well, he, he is, he is of aristocracy, you know. Yeah.
James Boyle:
[00:40:29 – 00:40:34]
So maybe that’s where he, he can draw from that. Well, he does. He’s, it’s great performance.
Richard Taylor, Founder of Plan First Wealth:
[00:40:35 – 00:40:47]
Oh, really? He’s. I like him. I enjoy Game of Thrones, you know, nothing. Jon Snow, I like. Yeah, I’m watching the BBC adaptation from a few years ago of War and Peace.
James Boyle:
[00:40:48 – 00:40:49]
Ah, very nice.
Richard Taylor, Founder of Plan First Wealth:
[00:40:49 – 00:41:08]
And he’s a very good adaptation. But if you’ve read the book, you just, there’s just. The book is too big to condense into even a mini series, but it’s got some great actors in it. Paul Dano, James. I can’t think of his name. Happy Valley actor. Great actor.
James Boyle:
[00:41:08 – 00:41:09]
Northern Ireland.
Richard Taylor, Founder of Plan First Wealth:
[00:41:10 – 00:41:24]
No, he’s great as well, though. But not him. I can’t think of his name. Oh, it’s gonna really annoy me. But he, he, he’s great. It’s a really good a. It’s a, it’s a great adaptation, but you just can’t fit everything from that book into a program is just too big.
James Boyle:
[00:41:24 – 00:41:33]
Imagine the job of a screenwriter who has to read that book and then figure out how to fit it into a, I don’t know, an eight episode miniseries or six episode miniseries.
Richard Taylor, Founder of Plan First Wealth:
[00:41:34 – 00:41:38]
Yeah. Right. We done?
James Boyle:
[00:41:38 – 00:41:58]
I think so. We, we, you know, we always echo. Appreciate the audience listening. Follow us where you find your podcast and if you have any questions. Like we say, we want the remit of this style of the episodes here for Expat wealth to be responsive to our audience’s questions. So send them in. We really appreciate the engagement and want to make this cater to the people listening.
Richard Taylor, Founder of Plan First Wealth:
[00:41:58 – 00:42:17]
Yeah, we’ll keep. If we pick up signals, which is that episode on sips, we just got a deluge of people reaching out to us, then we’ll bring that up. But don’t be afraid to come at us with questions, queries, and maybe we can build a segment around that.
James Boyle:
[00:42:17 – 00:42:33]
Absolutely. And if you’re listening to this and thinking of questions that occur to you, that means probably there’s dozens or a very large group of people who are also thinking about it but won’t send the question in. So don’t be shy because we definitely see these themes and like we said, we want to help where we can. Absolutely.
Richard Taylor, Founder of Plan First Wealth:
[00:42:33 – 00:42:36]
Excellent. All right, James, thank you very much and I shall see you soon.
James Boyle:
[00:42:36 – 00:42:38]
Here’s the spring. Cheers, Richard.
Richard Taylor, Founder of Plan First Wealth:
[00:42:39 – 00:43:39]
Here’s the spring. Yeah. All right. Bye bye. All right, folks, that’s another episode of Expat wealth under our bell belts. Thank you for listening. I appreciate it and I appreciate you. If you’re enjoying the show and would like to support the mission which is to help ambitious expats thrive in America and ask you to subscribe to the POD wherever you listen and also consider leaving a rating and review, this stuff really does matter. Please help us get this information to the people who need it, that is to your fellow expats. Just a quick reminder that this show is brought to you by Podcast First Wealth. We are a US based financial planner and wealth manager and we help successful American and international families living across the US to make the most of their opportunity and ultimately to retire happier. If you’d like to know more about how we might be able to help you, you can find us on our website planfirstwealth.com or you can look me up on LinkedIn. Do get in touch. We’d love to hear from you. As always, thank you to the Podcast guys for their help producing this episode and the entire show. See you next week.
Production