By Peter Dougherty
MOST investing advice assumes we live our life in one country, with one currency, one language, and one tax system.
But as expats residing in Spain, our financial reality is different. Living abroad changes how we should invest – not because the stock market behaves differently in Spain, but because our life does.
Income taxes are higher in Spain than in the US or UK, especially at higher incomes. It’s also likely we face higher-than-average cash needs for moves, property deposits, and family transitions.
Added to these are exchange rate complications; we may spend in euros, but chances are we still own assets denominated in pounds or dollars. And let’s not forget the investing challenges we would face wherever we live: keeping up with inflation and markets that don’t rise in a straight line.
With all these uncertainties, investing mistakes become more likely. That’s why the smartest approach for expats in Spain isn’t chasing the biggest gains – it’s avoiding costly cross-border mistakes.
But old maps don’t work in a new territory. The best way to avoid mistakes is to hire a financial planner who understands Spain.
By doing so, we can help ourselves in several important ways.
First, our cross-border situation changes what counts as a good investment. The same portfolio can have completely different outcomes depending on tax residency status, how gains are taxed locally, treatment of ISAs, UK pensions, IRA, 401(k)s, and timing of realized gains.
A financial planner helps ensure our strategy is built around the rules we actually live under – not the ones we used to have.
Second, estate planning becomes more complicated when your life spans more than one legal system, especially if you have assets in multiple countries, property in Spain and/or assets abroad, or inheritances or beneficiaries abroad.
Even when legal advice is required, a planner can coordinate the financial aspects, so your investments and accounts are aligned with your broader intentions.
Third, we worry that we’re missing something. Even financially savvy people hire financial planners because they want a second opinion, someone to check for errors.
This is particularly true in Spain. Due to language and cultural differences, information about financial norms, tax systems, and investment rules in Spain is frequently difficult to understand or contradictory.
A good financial plan doesn’t just aim for “enough money for retirement.” It aims to give us peace of mind.
Fourth, as expats we are more vulnerable. We’re a target for banks and other financial institutions to sell us high-fee financial products.
These are often promoted as unique and tax-efficient solutions but in reality have many restrictions, fees and hard-to-see risks.
A financial planner acts as a filter, helping us understand what we’re really buying and whether it benefits us or the salesperson.
Finally, a planner helps minimise our behavioural mistakes: uncertainty, relocation stress, and currency swings make people more likely to hold too much cash, overreact to headlines, panic-sell during volatility, or jump between strategies.
A planner can add structure and discipline – often the difference between staying invested and making the kind of emotional decision that permanently damages long-term results.
I like to think of a financial planner as the one type of ‘expat insurance’ that actually pays out: fewer costly mistakes, fewer unpleasant surprises, and a plan that still works whether you stay in Spain for generations or move again next year.
Peter Dougherty is a Financial Planner at BISSAN Wealth Management in Spain. He holds an MBA in finance from Columbia University in New York and an MS in Spanish Taxation (Máster en Fiscalidad y Tributación) from Nebrija University in Spain. He is a European Financial Planner (EFP) in Spain and is a CERTIFIED FINANCIAL PLANNER™ professional and a Chartered Retirement Planning Counselor® in the United States.
For more information: https://www.financial-planning-in-spain.com
Peter Dougherty
- MBA in finance
- MS in Spanish taxation
- BS in Economics
- European Financial Planner in Spain
- Chartered Retirement Planning Counselor® in U.S.
- Author of two financial planning books
- Certified Financial Planner™ in U.S.
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