The Special Relationship

by Jon Langford

It is often said that England and America are two countries divided by a common language, but for expats residing in the U.S., cultural nuances are a daily part of life. I remember the first time I heard a child’s dummy referred to as a pacifier, I expected some sort of medieval torture device to be rolled into the living room.

Now, I’m with the Americans on a lot of things (I think taking the “U” out of color was an inspired move) but some things will forever seem foreign to us Brits. Here is my list of uniquely American peculiarisms:

1. Putting Sugar on Stuff:

Ordering something advertised as an “English breakfast” can be as perilous as a pilgrim’s pilgrimage from Plymouth. It’s no secret that our American friends have a sweet tooth, but do we really need sugar in baked beans? Is brown sugar necessary on bacon? Of course, the irony is the Brits are the ones with the bad teeth.

2. Crowd Participation in Movie Theaters:

Going to the cinema in the land of the free is about as close as you can get to the British pantomime experience. You can boo the baddies, cheer the goodies, and even clap at the end if you want. The only downside is there are no free sweets.

3. Ending Sentences with “Or no?”

“Are we going swing dancing tonight… or no?”

“Is it still the 1920’s… or no?”

“Is the time machine ready yet… or no?”

4. Beginning Sentences with “P.S.”

Aside from the fact it’s more annoying than someone stopping when they get to the top of the subway stairs, it doesn’t make sense to say. P.S. comes from the Latin “post scriptum” meaning “written after.”

5. Jaywalking:

This is the stuff of urban legend. I’ve never been ticketed or met anyone who has and I enjoy a good jaywalk several times a day, every day of the week. Sometimes I do it in front of a police car, just for the hell of it.

6. The Silent ‘H’ on “Herb.”

As far as I’m concerned, “vitamins” and “tomatoes” are fair game. All the letters are being acknowledged, they’re just being pronounced differently. But if you’re going to pronounce it “erb” then why isn’t the same logic being applied to every word beginning “Her…?”

“‘Er ‘erd of ‘ermits and ‘errings had ‘ereditary ‘erpes,” said the cheeky American cockney when asked to explain why his sister’s bizarre collection of animals had died.

7. The “Have a Nice Day” Send-Off:

I’m with the Americans on this. I’d rather be on the receiving end of an insincere “Have a nice day!” than the miserable grumble favored by most shopkeepers in the U.K.

8. Periods:

Picture the scene: A great American novelist is dictating copy to his English intern, “The woman was suffering. Pain again!” he says, dramatically. But the American usage of “period” instead of “full-stop” sabotaged the sentence. What the intern wrote was, “The woman was suffering period pain again!”

9. Federal Holidays:

“What are we celebrating this time? Labor day? What on earth is that? Actually, I don’t care. Can I have another beer?” There seems to be a federal holiday every month and expats are never shy in joining in the festivities. We may stubbornly refuse to refer to football as soccer, but we’re more than willing to have a drink and whoop over the fireworks on July 4, even though we’re toasting the demise of the British Empire.

10. Confusion Over the Following Terms: British, English, Scottish, Welsh, and ‘From the U.K’.

“So, the U.K. is in London?” an American from Ohio once asked me. I suppose it’s like cricket, if you didn’t grow up with it, it can be rather confusing.

Jon Langford is the bass player for British rock band The Chevin, currently based in NYC.The band has toured Europe supporting Franz Ferdinand, White Lies, The Airborne Toxic Event and The Pigeon Detectives. They made their US television debut performing their single “Champion” on the Late Show with David Letterman on 29 August 2012.

@Jon_LangfordNYC

deVere USA Inc. Invites St. George’s Society Members to Ask Questions Relating to All Aspects of their Financial Planning

deVere USA Inc. invites St. George’s Society members to ask questions relating to all aspects of their Financial Planning

deVere USA Inc. recently co-hosted a seminar with the British Consulate-General and we were delighted that many St. George’s Society members were able to attend. At the end of the session we were inundated with questions and queries at varying levels of complexity. As a result we would like to invite all members to ask any pertinent questions on any aspect of Financial Planning that is relevant to their situation. Our commitment is to provide prompt and comprehensive answers.

The areas that you wish to ask questions on may include the following:

-Financial Planning
-Investment Advisory
-Asset Allocation Models
-Budgeting
-Corporate Benefits
-UK & Foreign Pensions
-401k
-IRA
-College / University Funding
-General Saving – Best Routes
-Existing Legacy Plans
-Estate Planning – UK IHT, US Estate Taxes
-Questions regarding existing arrangements
-Estate and Succession Planning

Example questions:

“I have recently received a letter from my UK pension scheme to advise that the Trustees are reviewing my future pension benefits. Surely my final salary pension is guaranteed so how can they change this when I am so close to retirement?”

Unfortunately, final salary pension schemes are not guaranteed and do rely on the scheme remaining solvent when you retire and for the duration of your retirement. With unprecedented levels of debt within the UK we are seeing a growing number of public and private sector pension schemes looking to change the benefits their members will receive. One common method is to change the age at which the member can retire from say age 65 to age 67. The most common change we have encountered and by far the most effective is to change the indexation on pensions from RPI (Retail Price Index) to CPI (Consumer Price Index), currently CPI is 1% less than RPI and when compounded over the lifetime of your pension payments can have a significant impact on your pension payments. Whilst for the pension administrator it helps reduce their pension liabilities, it only reduces the entitlement of the pension members themselves.

 

“I have been in the US for over 15 years and during my time worked for four separate companies, at the moment I have 3 separate frozen 401k pension arrangements, I am not actively managing the schemes nor is my advisor, is there a way I can consolidate the three into one and better affect the returns?”

 

Yes a very easy process is to roll all of your frozen 401k assets into an IRA (Individual Retirement Account), there is no tax payable on the roll and you have the ease to administer only one scheme not three, generally with cheaper fees and wider investment flexibility. Having regular reviews of portfolio performance quarterly alongside your advisor, generally will increase returns.

“I am the CEO of a small sized company in the US, currently we operate a 401k scheme with 400 members, as pension trustee I have a fiduciary duty to ensure the members get the best deal. I feel the current expense ratios on our scheme are high and investment options out dated but do not really know what other options exist and have not got a great amount of time to investigate, can you provide assistance with this?”

deVere USA has an in-house corporate benefits team who specialize in this area with particular reference to small – medium sized enterprises. Generally speaking if you have operated your 401k scheme for a number of years your expense ratios are higher, typically around 3-4% and there are much more cost effective solutions available where we can reduce this to around 1% by using ETF driven models for example. The process of reviewing and providing a solution is not arduous and will not expend a lot of time on your part.

“I left the UK over 20 years ago and been tax resident in the USA ever since, I still have property in the UK but nothing else, given I have been outside the UK for so long and non-resident then I assume I do not need to worry about UK Inheritance Tax (IHT), is this true?”

No unfortunately not, if you are a UK national you automatically obtain the domicile of your father at birth so assuming he was a UK national then you are also considered UK domicile and subject to UK Inheritance Tax on your worldwide assets. Being resident in the US does not change this. Therefore typically each spouse assuming both UK nationals have a 325, 000 nil rate band, total inter-spousal 650,000 gbp. Above which you are subject to IHT at 40%.

It is very easy to change your tax residence, almost impossible to change your domicile and is a common misconception amongst UK expats in particular.

If you have any questions on any aspect of Financial Planning please contact:

Benjamin Alderson
Country Manager
deVere (USA) Inc.
Phone: (direct) 646-664-0693
E-mail: benjamin.alderson@devere-group.com

Adrian E. Flambard CTA, TEP
Senior Investment Advisor
deVere Group (USA) Inc.
Phone: (direct) 646-664-0681
E-mail: adrian.flambard@devere-group.com
Website: www.devere-group.com