Financial planning across borders: empowering Canadians in a globalized world
At a time when more Canadians are globally mobile, professional financial planners have the expertise to advise clients on managing their finances across borders. DRS producoes via getty images
Whether retiring abroad, investing overseas or supporting family in other countries, Canadians can benefit from the guidance of professional financial planners who think beyond our borders.
Tashia Batstone
President and CEO,
FP Canada
In today’s interconnected world, our lives are no longer purely local. Globalization is increasingly defining how we live, work and retire, so the traditional model of financial planning rooted in a single jurisdiction is evolving.
For a growing number of people living in Canada, especially newcomers, managing personal finances requires looking abroad. Assets, family obligations and financial goals can span countries and continents. Whether it’s supporting relatives overseas, navigating foreign investments or planning retirement in another country, complex cross-border financial lives are a reality for many of us.
People also now routinely cross borders for career opportunities or simply a better quality of life. They may live in one country, hold assets in another, have pensions in a third and plan to retire in a fourth.
All of this presents financial planning challenges. The good news is, professional financial planners – with a foundation built on rigorous training, ethics and a client-first approach – are uniquely positioned to meet the complex needs of globally mobile Canadians.
The benefits of professional guidance
When you turn to a Certified Financial Planner professional or a Qualified Associate Financial Planner professional for advice, the relationship will start by learning about you. When it comes to international considerations, they may ask some of the following questions:
Where do you plan to retire?
Where do you own property, hold investments or have family that you support outside Canada?
Do you have pension entitlements or citizenships in other countries that could affect your financial picture?
They will go beyond the basics to fully understand cross-border nuances – and then translate that understanding into actionable strategies. Here are some areas where the expertise of a globally attuned financial planning professional is critical:
Retirement and estate planning
Cross-border retirement and estate planning introduce a new set of challenges. Is your pension portable between countries? What about investment income from another jurisdiction? Will foreign-held assets be subject to unanticipated estate laws or inheritance taxes? What happens if the provisions of a will created in one country are not recognized in another?
Professional guidance in this area is critical to ensure you can not only retire but continue to thrive, with the peace of mind you deserve, regardless of where you settle. And, with the right estate planning advice, you’ll know your wishes will be carried out.
Taxes
No area of cross-border financial planning is quite as complex as taxation. Differing definitions of tax residency, foreign income rules and the threat of double taxation can easily erode wealth if not properly navigated. Agreements between countries offer relief, but only to those who know how to interpret and apply them correctly.
Professional financial planners are aware of the tax implications of living, working or earning investment income in multiple jurisdictions. They can work with tax experts across borders to ensure your financial plan reflects all relevant considerations.
Ethical and regulatory considerations
When you move across borders, so do regulatory risks. A professional financial planner stays updated on evolving regulations in relevant jurisdictions and can help you navigate the considerations specific to your circumstances, in partnership with other professionals. It’s not just about knowing the law, but understanding its essence across different legal ecosystems.
The CFP designation and QAFP designation are built on a commitment to high ethical standards and acting in the best interest of the client. And since CFP certification is a global credential, you can take comfort in knowing that CFP professionals in jurisdictions around the world are held to the same high standards.
The global nature of the financial planning profession
No single financial planner can master the tax codes, legal frameworks and regulatory environment of every country. That’s why professional financial planners, and the organizations supporting them, are collaborating more intently than ever across borders.
One example is the close relationship between FP Canada – the national not-for-profit education, certification and professional oversight organization working in the public interest – and the Financial Planning Standards Board (FPSB), a global standards-setting organization for the financial planning profession.
As an active participant in FPSB’s international network, FP Canada regularly engages with affiliate organizations from 28 jurisdictions. We come together annually to share ideas, address challenges and raise the standards of financial planning internationally. This collaboration ensures that Canadian financial planning professionals aren’t just keeping pace with international trends – they’re also helping shape the future of the profession around the world.
This co-operative spirit is also reflected in FP Canada’s support for World Financial Planning Day, held annually in October to promote the value of financial planning for consumers everywhere.
Recently, FP Canada also deepened its international engagement by partnering with the Financial Planning Institute of Southern Africa. A new memorandum of understanding encourages the exchange of knowledge and the sharing of best practices between the professional bodies in both countries, all for the benefit of consumers.
Even alliances here in Canada have advantages in terms of international expertise. For example, FP Canada’s memorandum of understanding with CPA Canada fosters collaboration with the accounting profession, strengthening the support available to Canadians navigating cross jurisdictional and cross-border financial matters.
The role of education
Financial planners – as with all professionals – carve out time every year for ongoing education, as an essential way of ensuring their knowledge stays current. And in today’s globalized world, learning about cross-border planning considerations is more relevant than ever.
The financial planning profession in Canada, under FP Canada’s leadership, is actively expanding opportunities for Canadian planners to benefit from this type of learning. Partnerships with internationally recognized organizations like Kitces.com and Shaping Wealth provide Canadian financial planning professionals with access to content that addresses issues beyond our borders.
These initiatives ensure financial planners are well equipped to advise clients who may, for example, work in Canada, hold assets in the United States, plan to retire in Portugal and are navigating complicated international tax regimes.
Why is this important for Canadians? Because it means that when you turn to a CFP professional or QAFP professional for financial guidance, you know they are continuously learning, growing and adapting based on international insights and best practices.
Globalization is not a passing trend; it’s a permanent shift. To navigate the financial implications of this shift, it’s essential to have the right expert by your side. To find a professional financial planner who can provide you with personalized advice for your unique circumstances, visit findyourplanner.ca.
To view this report on The Globe's website, visit globeandmail.com
To view the full report as it appeared in The Globe's print edition Financial
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