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Moving to Mexico. What to do about assets NOB?


MakeItSo
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On 3/18/2022 at 3:24 PM, MakeItSo said:

We're getting closer to moving permanently to Mexico. What to do with liquid assets in Canada?  

A) Move it all to Mexico? Where to? 
B) Better to keep it all / part in Canada? Why? 
C) ?

Fuller picture: 

1: By the time we move we won't have family / relations left in Canada, and once we sell the house we won't have a residence. 
2: We're not looking to buy bullion or crypto. 
3: We have RRSPs, which will take time to withdraw. 

Not seeking legal or accounting advice, just tips from experienced expat perspective... 

We sold house and wound down my business assets. Went with Scotiabank in Alberta and here we are with Intercam. Brought just some chairs,art. a lot of our kitchen stough, some of my shop things. woodworking and mechanic. If you ain't an alleged criminal like those rogue few truckers you won't have your Canadian bank acct. seized ever. Canada STILL probably has the safest banking system in the world . No, boobie brown, there weren't no foreign troops called into Canada. You have that confused with Ukraine.

 

pedro kertesz

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3 hours ago, happyjillin said:

We sold house and wound down my business assets. Went with Scotiabank in Alberta and here we are with Intercam. 

Meaning: maintain banking accounts in Canada to keep most assets there, and only do day to day banking in Mexico?

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23 hours ago, Alpha1 said:

Getting proper legal and accounting information is critical and cheap insurance, since what you don't know will hurt you.

We will. But I expect the answers we'll get will match answers we get now from anyone we tell about moving to Mexico: blank eyes or "are you crazy"? Which is why I also want to hear from those of you who've been here a long time.

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We've been here almost 16 years and  get our legal advice from a lawyer here. Only need accountant for income tax,also here. Vehicle insurance only. we have a very honest agent who told us it would be a waste of money for any kind of home insurance. His rational- house won't burn and contents can be replaced as well as any theft because the ladrons will only take what they can carry. We pay medical/ dental/drugs out of pocket[made sure we had a slush fund for it] Med insurance is throwing good money after bad.

 

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8 minutes ago, mexijims1 said:

Keep assets in CANADA , PERIOD !!

Mexico is uncertain, now more than ever with this current government !!  

This is where we spend 99% of our money so we maintain a healthy balance in our Intercam account for the convenience of not adding to it constantly. We ain't gonna go broke if we lose every centavo which we won't, in any event. I ain't gonna get all paranoidal like some of ya. We have a chequeing acct. here and same in Canada-no investing crap ta worry about. We got more pleasant things ta occupy or limited time left on this planet.

IMG_1360.jpg

joke alfred e. neuman.gif

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On 3/19/2022 at 2:55 PM, MakeItSo said:

I was going to ask to take into account geopolitical considerations, such as governments freezing bank accounts, but thought it was too political for the board...

there is nothing political about your financial  and heath well being--

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22 hours ago, MakeItSo said:

We will. But I expect the answers we'll get will match answers we get now from anyone we tell about moving to Mexico: blank eyes or "are you crazy"? Which is why I also want to hear from those of you who've been here a long time.

my latest stay is retirement--going on fifteen years--you will assimilate soon enough and the culture shock will dissapate --as coming from California and it's fast pace ; it took awhile to slow down and learn patience--sometimes waiting a whole year to wait for things from family from the states--fifteen years ago there was little things from the states ; but today I can almost find anything.

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I am Canadian, as is the OP, and have zero knowledge of financials in the USA. Hence I  don't chime in with any advice re: that. Why do so many of you USA-ers blow smoke about what you don't know squat about. The OP has asked us fellow Canucklheads about OUR experiences to AID him in his planning.

canadian flag.jpg

mexican-flag.jpg

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2 hours ago, happyjillin said:

I am Canadian, as is the OP, and have zero knowledge of financials in the USA. 

And it is clear that I know zero about keeping assets in Mexico, hence the topic. Although, I should add it was a brilliant idea to buy property here just before inflation wipes out our bank accounts...

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35 minutes ago, MakeItSo said:

And it is clear that I know zero about keeping assets in Mexico, hence the topic. Although, I should add it was a brilliant idea to buy property here just before inflation wipes out our bank accounts...

Inflation won't wipe out your bank accounts so you have no worries in that respect so now you have an additional asset

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Don't get political Bobby.

I have to say we've been pretty satisfied with the performance of our investments at Actinver.  It seems NOB there are few options with decent earnings other than gambling on the stock market these days and we are just a bit too old for that.  We make three times on our investments here versus what we make up there.

When it comes to fiscal responsibility of governments Mexico doesn't do all that bad particularly when compared to, frankly the U.S. no matter who is in charge.  These days we are more concerned about the dollar than the Peso.  Fitch had this to say about the 2022 Mexican Government budget:

Quote

Fitch Ratings-London/New York-17 September 2021: Mexico’s 2022 budget proposal continues to limit fiscal impulses, allowing for a small primary deficit consistent with a stable debt/GDP ratio, Fitch Ratings says. Policies prioritizing public finance sustainability, along with a stable macroeconomic policy framework, underpin Mexico’s (BBB-/Stable) sovereign rating.

The 2022 budget draft targets a fiscal deficit of 3.1% of GDP and a 0.3% primary deficit, compared with a 0.4% primary surplus outlined in April’s preliminary guidelines. The budget maintains a similar spending profile to the first three years of the current administration. Expenditure prioritizes ongoing investment projects, such as the Mayan train and Istmo de Tehuantepec inter-oceanic rail project, in an effort to improve economic dynamism in southern Mexico. Social expenditure focuses on increasing pension spending.

The government avoided major revenue-raising tax reform, sticking to a recent pledge ruling out new taxes or higher tax rates in the near term. Rather, the government will continue attempting to improve tax collection and reducing evasion. The budget draft introduces a simplified tax regime aimed at encouraging small businesses in the informal sector to register with the tax authorities.

Moreover, the draft proposes reducing PEMEX’s (BB-/Stable) profit-sharing tax, or derecho de utilidad compartida, to 40% from 54%, which will structurally reduce the share of oil revenue in government revenues in future years to 9% in 2021 and 8% in 2022. Low government revenues will continue to hinder Mexico’s spending capacity.

Fiscal policy is consistent with stable debt/GDP over the medium term. We project general government debt, measured as Federal Government & Social Security plus State and Municipalities plus IPAB, which administers the bank savings protection mechanism, but not including PEMEX, to remain slightly below 48% of GDP over our forecast horizon, significantly below the 2022 ‘BBB’ rating category forecast median of 58.7%.
 

The run up in oil prices has been positive for Mexican finances in the past.

As far as Canada goes, for some reason which I don't fully understand it seems the Canadian dollar is consistently undervalued given the stability there.  There was a short period of time a few years ago when the two actually hit parity.  But it seems to me the Canadian government seems to be less fiscally responsible than it used to be and maybe that is why the exchange rate.

It seems to me that U.S. people should be most concerned about moves to replace the dollar as the international reserve currency.  What I read is this status is the main thing keeping the value of the buck from cratering in the face of a sea of red ink.

 

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You do not want to put a substantial amount of money in a peso denominated account. If I had done that in 2008 at 10 to 1, and at one point in early 2020, the exchange rate was over 23 to 1. Any money in a Mexican peso account would have lost over 55% of the principal. Not good. Also Mexican banks apply fees as they wish so you have to watch the account closely. Leave your money in Canada and use ATM's in Mexico to get walking around money. 

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5 hours ago, tomgates said:

You do not want to put a substantial amount of money in a peso denominated account. If I had done that in 2008 at 10 to 1, and at one point in early 2020, the exchange rate was over 23 to 1. Any money in a Mexican peso account would have lost over 55% of the principal. Not good. Also Mexican banks apply fees as they wish so you have to watch the account closely. Leave your money in Canada and use ATM's in Mexico to get walking around money. 

So you just didn't do it right and  my bank, Intercam, doesn't charge me any fees on my chequeing acct. with them. When you live here and own a house ,you need to have access to more than just walking around money. Good thing you're not a paid financial advisor.

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3 hours ago, happyjillin said:

Also Mexican banks apply fees as they wish so you have to watch the account closely. Leave your money in Canada and use ATM's in Mexico to get walking around money. 

While I wouldn't put all my money in a Mexican bank, some of us actually behave as if we live here, have debit cards from Mexican banks, etc., not act as if we are on holiday, only using ATMs for "walking around money".

I've had a Bancomer account for about 13 years and I've never had any fees applied that weren't clear in the info the bank provides for various accounts. 

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On 3/24/2022 at 5:10 AM, tomgates said:

 Also Mexican banks apply fees as they wish so you have to watch the account closely. Leave your money in Canada and use ATM's in Mexico to get walking around money. 

That statement is totally false.  All bank fees associated with an account are clearly spelled out in the account documentation. They don't and legally can't "apply fees as they wish" 

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Thank you for all your replies.
I canvassed 8 neighbours (permanent residents and naturalized citizens). Only one moved all assets to Mexico. The others didn't move money because of the hassle, family who live up north and will inherit, or (majority) keep their money north in case personal circumstances change and they need to go back. 
So it seems a matter of choice and personal circumstances...

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On 3/20/2022 at 11:38 AM, happyjillin said:

We sold house and wound down my business assets. Went with Scotiabank in Alberta and here we are with Intercam. Brought just some chairs,art. a lot of our kitchen stough, some of my shop things. woodworking and mechanic. If you ain't an alleged criminal like those rogue few truckers you won't have your Canadian bank acct. seized ever. Canada STILL probably has the safest banking system in the world . No, boobie brown, there weren't no foreign troops called into Canada. You have that confused with Ukraine.

 

pedro kertesz

Why would there be no name tags and dressed in military garb-? why would you defend a country you are leaving? I left the US because it started to decline ; and now look at it--I won't ever go back ; let alone vacation--I won't live long enough before things get better ; if ever-- I have no tolerance for corruption being directed at me--PERIOD--

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On 3/24/2022 at 11:59 AM, happyjillin said:

So you just didn't do it right and  my bank, Intercam, doesn't charge me any fees on my chequeing acct. with them. When you live here and own a house ,you need to have access to more than just walking around money. Good thing you're not a paid financial advisor.

UKRANIAN flag ?                That's one cat fight I could give a sh##t--HA

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IMHO the current Mexican admin is no worse that all which have come before when it comes to stability.  Many opinions here are based on whether those in power tend to lean left or right to coincide with leanings of authors.  I will offer to agree with Tom's recent post about how to handle money here.  Leave all but a little in a savings account in your bank back in Canada or US.  Peso accounts do offer better interest rates but that's because the peso is not very stable.  I lived here in 1972 when the rate was 12.5 pesos to one dollar and twenty years later it was 3,000 P to $.  The in '94 the government removed three zeros and it went to 3P to $ overnight.  Now it's about 20P to $ and has been that for about four years (under current prez.)  Just bring a debit card and use ATM's and many NOB banks even refund fees to your account.  Have credit card for online and major purchases and pay off charges at the end of the month.  Don't keep lots of money in debit card checking account to limit chances of theft if card is lost or stolen.  Move your money from savings to checking as needed.  There is no government insurance for losses incurred at any Mexican bank and there have been stories of folks who just lost funds because of account inactivity. 

Alan

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5 hours ago, barrbower said:

 There is no government insurance for losses incurred at any Mexican bank and there have been stories of folks who just lost funds because of account inactivity. 

Alan

If what you say is true then this information regarding the government is wrong?

The Institute for the Protection of Bank Savings (IPAB) was created 18 years ago. (https://www.gob.mx/ipab/)

The banks are the financial entities that have a deposit insurance backed by the government, but what are the products protected by the IPAB?

-Savings accounts

-Debit

-Check account

– Payroll account

-Investments will pay with liquidatable yield at expiration

-Deposit certificates

The National Commission for the Protection and Defense of Users of Financial Services (Condusef) states that the equivalent of 400 thousand Units of Investment, approximately two million 58 thousand pesos, per individual or company, and bank can be covered.  https://www.condusef.gob.mx/

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I would appreciate a link to what you have stated MostlyLost. The link provided seems to be all about the liquidacion of a particular bank. But, gee, ONLY in place for the last 18 years? And is that amount the TOTAL that will be paid out?

Canada: Canada Deposit Insurance Corporation - Wikipedia

U.S.: FDIC: Deposit Insurance At A Glance

 

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See here: https://www.mexperience.com/how-safe-is-your-cash-in-mexico/

For a list of banks with IPAB insurance: https://www.gob.mx/ipab/acciones-y-programas/bancos-con-productos-protegidos-por-el-ipab

Most bank websites show specifically which accounts are covered. For e.g., Intercam shows this: https://www.intercam.com.mx/inicio/productos-protegidos-por-el-ipab/

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I was not aware that any kind of deposit insurance is available.  Even though it doesn't cover a large amount, it is better than nothing!  I'm sure making a claim and then collecting is far from easy but I also think there are really not that many problems with lost deposits.

Anyway, thanks for the heads up.  Alan

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Just on a side note. if the economy goes belly up and banks go bankrupt, but your deposits have some sort of government insurance, well they may pay you back for your losses but....if every one loses your 30,000 pesos may just be enough to buy a roll of toilet paper. 😊

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