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How to Retire to the U.S. from the UK: A Step-by-Step Guide for Expats
Hoxton Blog • How to Retire to the U.S. from the UK: A Step-by-Step Guide for Expats
Many UK expats ask whether they can retire to the U.S. It is possible, but the process is complex. This guide explains visa options, tax exposure, healthcare costs, and pension planning, and outlines the steps needed to retire to the U.S. with clarity and preparation.
Can UK Expats Retire to the U.S.?
A common question among UK expats is whether retiring to the United States is possible. The short answer is yes, but it is rarely straightforward. Unlike many European destinations, the U.S. does not offer a retirement visa based on age or income alone.
Despite this, thousands of UK nationals live in the U.S. on long-term visas or permanent residence. U.S. immigration data shows that family-based and employment-linked routes remain the most common pathways for British citizens settling in the country.
People are often drawn to the U.S. for family reasons, lifestyle flexibility, and access to high-quality healthcare.
However, visas, worldwide taxation, private healthcare costs, and pension treatment all add complexity. In this article, we explain how retiring to the U.S. from the UK works, the steps involved, and the risks to plan for before making the move.
Why Listen to Us?
Hoxton Wealth works with UK expats globally, including those with U.S. residency, green cards, or long-term relocation plans. The firm supports cross-border retirement planning involving UK pensions, U.S. tax rules, and international investments.
This experience informs a practical view of what retiring to the U.S. involves in reality. Learn more through Hoxton Wealth’s expat financial advice resources.
Why Retiring to the U.S. Is Different for UK Expats
The U.S. differs fundamentally from most EU and Commonwealth retirement destinations. There is no automatic right to retire there. Immigration status comes first, and financial planning follows.
The U.S. tax system also operates on a worldwide basis. Once you become a U.S. tax resident or green card holder, global income and assets fall under U.S. reporting rules. This includes UK pensions and investments, which can trigger complex IRS disclosures.
Healthcare is another key difference. The U.S. does not provide state-funded healthcare for retirees in the same way as the UK or Europe. Medical costs must be planned for privately until Medicare eligibility applies.
These factors mean that retiring to the U.S. usually requires coordinated immigration, tax, pension, and healthcare planning.
How to Retire to the U.S. from the UK
Step 1: Check If You Can Legally Live in the U.S.
There is no dedicated U.S. retirement visa. Legal residence must be secured through other immigration routes, and the feasibility, cost, and timeline of each option can vary significantly.
The most common routes for retirees are family-sponsored green cards, typically through marriage to a U.S. citizen or sponsorship by an immediate family member. These routes can be relatively stable but often involve lengthy processing periods, commonly ranging from 12 months to several years, depending on visa category and country of origin.
Employment-based visas may apply where an individual continues working or consulting, although these are less common for traditional retirees and usually involve employer sponsorship and renewal risk.
Investor visas are sometimes explored. The E-2 visa requires a substantial investment in a U.S. business and active operational involvement, but it does not lead directly to permanent residency. The EB-5 visa involves a significantly higher capital commitment, job creation requirements, and multi-year approval timelines, with no guarantee of success.
Importantly, income alone does not grant U.S. residency. Residency status, not citizenship, determines most tax, reporting, and healthcare access rules. Residency also differs from citizenship in terms of permanence, voting rights, passport access, and long-term security of stay.
Hoxton Wealth supports this stage by helping clients understand how different residency outcomes affect long-term financial planning assumptions before irreversible decisions are made.
Step 2: Assess UK–US Tax Exposure Before Moving
The U.S. taxes residents and green card holders on worldwide income, regardless of where assets are held. This includes UK pensions, investment income, rental income, and capital gains.
The UK–U.S. double taxation treaty helps allocate taxing rights but does not remove U.S. reporting or tax obligations. In practice, UK pensions such as SIPPs and workplace pensions are generally taxable in the U.S. when income is drawn, even if contributions received UK tax relief.
For example, income taken from a UK workplace pension is typically treated as ordinary income for U.S. tax purposes. SIPP drawdown is also generally taxable in the U.S., often without the same tax-free treatment that applies in the UK. Timing and structure therefore, matter significantly.
If pensions are structured incorrectly before U.S. tax residency begins, individuals may face punitive outcomes, including unfavourable tax treatment, loss of treaty protection, or complex annual reporting obligations. Once U.S. tax residency starts, restructuring options can become more limited and costly.
Hoxton Wealth supports this stage by helping clients understand how UK pension income is typically treated under U.S. tax rules and why pre-residency planning is often critical.
Step 3: Plan Healthcare Before You Commit
Healthcare is one of the most significant and often underestimated retirement costs in the U.S. There is no universal healthcare system, and access to public provision is limited.
Medicare generally becomes available at age 65, but eligibility depends on residency status and contribution history. Many UK expats do not immediately qualify and must rely on private insurance, particularly in the early years of U.S. residency.
Industry data suggests that private health insurance premiums for individuals aged 55–64 can commonly range from approximately USD 7,000 to USD 15,000 per person per year, depending on state, insurer, and coverage level. After age 65, Medicare reduces base costs, but supplemental policies and out-of-pocket expenses can still add several thousand dollars annually.
Healthcare costs also tend to rise faster than general inflation, making long-term budgeting essential. These costs can materially affect whether retiring to the U.S. is financially sustainable.
Hoxton Wealth helps clients model retirement cashflow scenarios that incorporate realistic healthcare assumptions, ensuring affordability is assessed before relocation decisions are finalised.
Step 4: Plan Your Pensions and Retirement Income Properly
UK pensions require careful handling both before and after U.S. residency begins. In many cases, retaining and restructuring existing pensions is preferable to transferring them.
For U.S.-linked retirees, international SIPPs are often favoured over QROPS. While QROPS can be appropriate in some jurisdictions, they frequently introduce complexity for U.S. taxpayers, including adverse tax treatment, ongoing IRS scrutiny, and uncertain treaty recognition. SIPPs generally offer greater familiarity within UK–U.S. planning frameworks and more predictable treatment when income is drawn.
Currency risk is another key consideration. For example, a retiree drawing GBP 30,000 per year from a UK pension but spending primarily in USD is exposed to exchange rate movements. A weakening pound could materially reduce real spending power over time, particularly in a high-cost healthcare environment.
Hoxton Wealth supports this stage by helping clients understand pension structure options, income timing considerations, and currency exposure risks within a compliant international framework.
Step 5: Build a U.S.-Compatible Retirement Strategy
A U.S.-compatible retirement strategy must integrate investment, tax, and estate planning considerations.
From an investment perspective, many non-U.S. funds commonly held in UK portfolios can fall foul of U.S. PFIC rules, which can result in highly punitive tax treatment and complex annual reporting. As a result, investment holdings often need restructuring before U.S. tax residency begins to ensure compatibility.
Estate planning is equally important. Once U.S. residency thresholds are met, U.S. estate tax can apply to worldwide assets, not just U.S.-based holdings. While U.S. citizens benefit from a high federal estate tax exemption, non-citizens and treaty planning considerations can materially alter exposure. Coordinated wills, insurance planning, and trust structures may be relevant depending on asset levels and family circumstances.
The UK–U.S. totalisation agreement can also affect how National Insurance and Social Security entitlements interact, supporting benefit eligibility across both systems when planned correctly.
Hoxton Wealth supports this process by coordinating retirement modelling, investment structure reviews, and long-term estate considerations within a cross-border planning framework.
Key Risks UK Expats Must Understand
Visa Rejection or Long Processing Delays
U.S. visa routes can involve lengthy processing times and uncertain outcomes, which may delay relocation plans or require interim living arrangements. Without contingency planning, delays can disrupt retirement timelines, housing decisions, and access to healthcare or income.
Unexpected U.S. Tax Liabilities
Once U.S. tax residency begins, worldwide income and assets can fall within the U.S. tax net. Without prior planning, this can result in higher-than-expected tax bills, complex reporting obligations, or inefficient taxation of pensions and investments.
Rising Healthcare Costs Over Time
Healthcare expenses in the U.S. tend to increase with age and can rise faster than general inflation. Failing to account for these long-term costs can materially undermine retirement affordability and income sustainability.
Pension Misclassification Under U.S. Rules
UK pensions may not always be treated as expected under U.S. tax rules, particularly if structured incorrectly before residency begins. Misclassification can lead to unfavourable tax treatment, increased reporting burdens, or loss of treaty protection.
Long-Term Currency Risk Between GBP and USD
Retirement income paid in sterling but spent in U.S. dollars is exposed to exchange rate movements over time. Prolonged currency shifts can reduce real spending power and introduce volatility into long-term retirement cashflow.
Understanding these risks early allows individuals to factor them into planning discussions, helping reduce the likelihood of costly or difficult-to-reverse decisions later on.
Why the U.S. Can Be an Attractive Retirement Destination
Access to Family and Established Communities
Living in the U.S. can allow retirees to be closer to immediate family members, including children and grandchildren, and to integrate into established expat or cultural communities. This proximity can provide emotional support, practical assistance, and a stronger sense of long-term stability in retirement.
Wide Lifestyle and Climate Choices
The U.S. offers a broad range of lifestyle options, from urban centres to coastal and rural locations, as well as diverse climate zones. This variety allows retirees to choose environments that align with personal preferences, health considerations, and desired pace of life.
High-Quality Healthcare is Affordable
The U.S. healthcare system is known for access to advanced treatments and specialist care, provided appropriate insurance or funding is in place. For retirees who can manage the associated costs, this can be an important factor in long-term wellbeing and peace of mind.
Strong Investment and Business Environment
The U.S. has a deep and well-established investment market, alongside a supportive environment for entrepreneurship and business ownership. This can be attractive for retirees who wish to remain financially engaged or maintain exposure to global investment opportunities.
Flexibility for Part-Time Work or Consulting
Depending on visa status, the U.S. can offer flexibility to undertake part-time work, consulting, or advisory roles in retirement. This can provide supplemental income, maintain professional engagement, and support a more gradual transition into full retirement.
How Hoxton Wealth Can Help
Step 1: Arrange an Initial Cross-Border Planning Discussion
The first stage typically involves an initial discussion to outline personal circumstances, including current residency, intended relocation plans, and existing financial arrangements. This helps frame which UK and U.S. considerations may be relevant and which areas require further review.
At this stage, Hoxton Wealth supports the process by explaining how cross-border retirement planning is commonly approached and what information is usually required to assess pensions, investments, and income sources.
Step 2: Review Pension Positioning Before U.S. Residency
Pensions are often reviewed before U.S. tax residency begins, as structuring decisions made early can affect future tax treatment and reporting obligations. This includes understanding how different UK pension arrangements may be viewed under U.S. rules once income is drawn.
Hoxton Wealth assists by outlining how pensions are typically positioned in advance of U.S. residency and identifying factors that may need to be considered as part of broader planning discussions.
Step 3: Consider How Retirement Income May Be Structured
This step usually focuses on understanding how different income sources may be accessed in retirement and how tax rules could apply across jurisdictions. It involves considering the interaction between pensions, investments, and other income streams over time.
Hoxton Wealth helps explain common income-structuring considerations in cross-border situations, supporting informed decision-making rather than assuming a single approach is suitable.
Step 4: Review Investment Structure and Currency Exposure
Investment holdings may need review to ensure they align with U.S. regulatory and tax frameworks. Currency exposure is also relevant where income or assets are held in sterling, but future spending is expected in U.S. dollars.
Hoxton Wealth supports this process by discussing how investment structures and currency risk are commonly assessed and monitored in international retirement planning.
Step 5: Factor in Healthcare and Long-Term Estate Considerations
Long-term planning often includes assessing potential healthcare costs and understanding how estate planning rules may differ between the UK and the U.S. These factors can influence affordability, legacy planning, and long-term financial clarity.
Hoxton Wealth helps individuals understand how healthcare budgeting and estate considerations are typically incorporated into cross-border retirement planning, with coordination across UK and U.S. contexts.
To discuss your situation in more detail, visit the Hoxton Wealth contact page.
Conclusion and Next Steps
Retiring to the U.S. from the UK is possible, but it is rarely simple. Immigration, taxation, healthcare, and pension planning must work together. Decisions made before U.S. residency often shape outcomes for decades.
With careful planning and regulated advice, UK expats can retire to the U.S. with greater confidence. Hoxton Wealth supports this process from early assessment through to long-term retirement planning. To get started, contact Hoxton Wealth.
FAQs
Can I retire to the U.S. without family sponsorship?
In most cases, no. Investor or employment-linked visas may apply, but there is no retirement-only visa.
How are UK pensions taxed in the U.S.?
UK pensions are generally taxable in the U.S. once you become a tax resident, subject to treaty rules.
Should I restructure my pension before U.S. residency?
Often yes. Planning before residency can reduce future tax exposure.
What are the tax risks of moving to the U.S.?
Worldwide taxation, reporting obligations, and pension treatment are key risks.
How does healthcare affect retirement in the U.S.?
Private healthcare costs are significant and should be planned well in advance.
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