For Brits in the U.S. — What Actually Works for Investing

Renascence & Partners LLC
Dec 9
3 min read

If you’re a UK expat calling the United States home, your investment game just got a lot more complicated. You’ve got to juggle two tax jurisdictions, two currencies — maybe even two retirement systems. But it’s not hopeless. There are sensible, powerful investment routes that play nicely with both sides of the Atlantic.

Below is a breakdown of the approaches that tend to work best and what you should watch the hell out for.

🔎 What Makes The Expat Situation Tricky (But Manageable)

Dual tax exposure. Once you live in the U.S., you may owe tax on your global income. Your UK-based investments, or income from the UK, can trigger U.S. tax reporting — even if they’re legally fine under UK law.
UK accounts get awkward. Existing UK holdings — pensions, savings accounts or investment wrappers — often survive. But opening new ones from the U.S. or contributing fresh money? That can become a legal minefield.
Currency risk is real. Pound to dollar swings can gobble up part of your return. That means your portfolio strategy needs to account for FX risk, not just asset-class risk.

Translation: think global, act carefully, don’t assume UK rules still apply.

✅ Smart Investment Paths for UK Expats in the U.S.

Here are the main strategies that tend to deliver, without dragging you into tax or compliance hell.

1. Keep a UK Pension — via an International SIPP

If you still have a UK-based pension, using an international Self-Invested Personal Pension (SIPP) can give you a clean, centrally managed way to keep it alive. You get access to diversified global investments, and the structure remains recognised by UK authorities.

2. Use U.S.-Based Investment Accounts That Behave Well for Expats

Rather than holding UK-domiciled funds — which for U.S. tax purposes are often classified as PFICs (Passive Foreign Investment Companies) — use U.S. domiciled funds, ETFs, mutual funds or brokerage accounts designed with expats in mind. Keeps reporting simpler and tax pain lower.

3. Leverage Employer-Sponsored Retirement Plans (401(k), IRA, etc.)

If you’re working in the States, participate in employer retirement schemes. 401(k), 403(b) or IRAs often give you tax-deductible contributions + matching — basically “free money” on the table. Especially valuable for long-term stayers.

4. Have a Low-Risk, Liquid Core for Short-Term or Emergency Needs

For money you might need soon — think cash-equivalents, short-term bonds, CDs, money-market funds — these remain solid if you prefer safety over growth. Good for lump sums, rainy days, or temporary funds.

5. Build a Globally Diversified Portfolio

Spread across equities, bonds and geographies — don’t put all your eggs in US or UK baskets. Diversification mitigates risk from currency swings, local market crashes, or regulatory/PT changes.

⚠️ What to Avoid or Watch Out For Like a Hawk

UK-only investment wrappers (ISAs, UK-domiciled mutual funds, etc.) — often trigger painful tax consequences under U.S. rules if you remain U.S. tax resident.
Assuming UK pensions/accounts remain frictionless. You can hold them — but contributing new funds or opening brand-new UK accounts after U.S. residency is risky or impossible.
Ignoring FX risk. If pounds dive versus dollars, otherwise solid investments from “back home” could lose real value when converted or used in USD.

Bottom line: what works in London doesn't necessarily fly in New York — or wherever you land in the States.

🧠 How to Choose Right — Depends On What You Want Out of It

Long-term retirement wealth? Use a mix: keep UK pension via SIPP (if valuable), but also engage with U.S.-based retirement plans + global portfolios.
Legacy / flexibility / modest savings? Lean on U.S. taxable accounts or safe instruments (bonds/CDs), stay diversified, don’t over-concentrate in one market.
Still have UK ties or may return? Maintain UK-based pension or investments with caution — but avoid complicating things by piling on new UK-domiciled wrappers post-move.

🔚 Conclusion: Playing Chess, Not Checkers

For UK expats in the U.S., investing isn’t about picking “the best fund.” It’s about structuring — carefully accounting for tax regimes, currency risk, residence status, and how your life may evolve.

Go broad, diversify, use smart vehicles (SIPPs for UK pensions, U.S. accounts for growth, employer plans for retirement), and avoid legacy UK wrappers that tax laws now dislike. Do that, and you’ve got a real shot at building cross-Atlantic wealth without tripping over invisible legal traps.