Americans Need Financial Advice to Move

Americans are moving for better jobs, lower taxes and happier lives.

Distracted by the demands of moving to new homes, schools or work environments, however, they sometimes underestimate the impact that major moves can have on their financial profile, especially when they change state.

Although the coronavirus pandemic boosted the migration rate in 2020, it maintained models established in previous years, according to at United Van Lines. Primarily, people moved to the western and southern states from communities in the Northeast, Midwest, and California.

According to United Van Lines data, the top reasons for moving are:

New job opportunity or business transfer (47.98%);

Closer to family (23.66%);

Retirement (20.15%); and

Lifestyle change (13.08%).

New job opportunities and transfers make sense as the number one reason for moving. According to Bloomberg News, “Americans who move see green” – and some of them may need help on the ground dealing with the extra income.

Businesses understand that our migratory habits have an economic impact. That’s why big companies like Walmart and Macy’s, as well as local hospitals, dental offices, and real estate agents, target a lot of their marketing to people on the go. They know that new residents have immediate needs like shelter, transportation, furniture and new wardrobes for new climates, as well as a new roster of health care providers.

A new service that provides referrals from end customers

But a change of interstate residence also requires financial preparation. At a minimum, financial preparation for a move should involve a review of financial plans and documents, and a strategic reassessment of goals and expectations, conducted by or in consultation with a local expert. Movers with large assets may in fact need a new or additional wealth management team, a contingency we come across often.

This is all one of the reasons Dynasty Financial Partners is preparing Dynasty Connect, currently in beta, for launch. The new unit can help new and potential movers obtain financial advice tailored to their needs from wealth managers – drawn from Dynasty’s network of independent financial fiduciary advisors – who understand the new region.

After all, there are some 13,000 independent RIAs in the United States, and the market is divided between financial planners and wealth managers with direct client contact, and sub-categories of asset managers, of hedge funds. and other entities that do not meet the needs. to individual investors. In this environment, unaided searches can be a mixed bag.

Moving from one state to another is an event with financial repercussions

Interstate migrants don’t just change the scene. While crossing state borders, they can also be subject to tax regimes that they may not know how to navigate. Beyond taxes, they should review all aspects of their financial lives, to make sure their plans match where they live. Otherwise, they risk avoidable financial setbacks, as plans formulated for conditions and laws in one place prove to be suboptimal in a new setting.

Besides tax considerations, other pillars of financial well-being that we invite people crossing borders to consider are:

Investments. Make sure that municipal bonds in a portfolio receive the same tax treatment in the new location, otherwise adjustments may be necessary. It is also helpful to know that states tax stock dividend proceeds at different rates.

Estate plans. Tax and probate rules may vary from state to state, which may require updating wills, creating trusts, or adjusting powers of attorney. For one thing, out-of-state assets can be better housed in a trust or LLC to minimize probate costs.

Cost of life. Moving states can bring a whole new standard of living, especially where house prices are very different and private school or daycare is the order of the day. A new roost may leave one with more or less cash, warranting a substantial overhaul, especially when it comes to household budgeting.

And there are other financial factors that, depending on the variables, may require special attention.

Moving is not the only reason to seek an advisor

But movers aren’t the only ones who benefit from Dynasty Connect.

One person we know received an offer of $ 5 million for their business and asked for help evaluating the offer and formulating a plan to use the proceeds to fund their retirement. We helped him find a counselor who matched his needs.

Another advisor-researcher that Dynasty helped entered part of his legacy years earlier than expected because his father had just completed a full estate plan. Suddenly much richer than before, she wanted help making the most of her newfound wealth.

As part of its new end-customer referral program, Dynasty plans to research and distribute end-customer referrals to advisors in its network. Referrals will come directly from this network, as well as centers of influence, events, Dynasty’s website and social media presence. We will also leverage its partnerships with athletes to generate referrals.

Joe D’Agostino is Head of Investment Platform and Product Strategy at Dynasty Financial Partners in St. Petersburg, Florida.