If you don’t know what the implications are for your finances – from super and tax to insurance and investments – moving overseas to work can result in a number of unexpected headaches. But Mercer’s market leading Global Advice Network aims to change all that.
These days, taking up a job overseas means far more than just finding a place to stay, booking the removalists and waving goodbye with streamers and morning tea. For both individuals and companies with global workforces, the implications of overseas assignments can be vast, especially when it comes to financial management.
For example, once you’ve jetted off, you can’t turn to your Australian financial advisor for help. If you have a self-managed super fund and you become a non-resident for tax purposes, that fund then becomes non-compliant. And what about all those deductions from your negatively geared investment property?
“People just don’t realise that there’s some really careful planning that you need to do before you head off overseas for work,” says Mercer Partner and Financial Advice Leader for the Pacific, Michelle Smith, “If you don’t get it right before you leave, you might end up in a worse financial position than before you left.”
The Global Advice Network (GAN) was set up by Mercer as a solution to these thorny and often complex issues. Because financial advisors are essentially governed by jurisdictions, maintaining the relationship between financial advisor and client after they’ve moved overseas is difficult. But by connecting advisors globally, from the UK and Europe to US and Australia, the GAN allows Mercer advisors to span borders by organising three-way conversations between the local and host Mercer partners and the client. “Previously, we had to say, ‘we can’t help you’,” says Smith, “Now we can have advisors around the globe that have a sophisticated understanding of the issues that expats face and who are able to deliver the relevant advice.”
The GAN can help with everything from thinking about super and contribution strategies, saving for retirement while you’re away, and tax and residency issues. It will also advise on implications for overseas staff of employee share schemes, health care and even estate planning. “If, for example, an individual buys assets in the host country,” says Smith, “those assets won’t be covered by their Australian Will. So estate planning needs to be looked at as well.”
Being part of Mercer, the GAN is able to link closely with the mobility and talent teams. This allows clients to get seamless advice on executive remuneration and how much people should be paid overseas, the issues involved with relocating as well as all the financial advice that can help before and after taking the overseas position.
“Companies that we’ve been talking to that have global rotation policies, especially through the UK, are quite excited that there is a way to deal with all the issues,” says Smith, “It’s a fairly market-leading product that we offer to clients. And for those that we’re helping, they’re now an employer of choice for talent because they’ve got a solution.”