Earlier this year, my girlfriend and I moved to the US from Canada for work. We underestimated the move and were surprised by some of the challenges we faced while moving. Thankfully, we were not alone as we connected with people starting new roles in the US too. Though it may be sad to leave family, friends, and the comfort of home, I think we all agree we learned to appreciate the experiences and grow. Since the initial move, more friends in our network relocated to the US and wanted our advice. This blog post is a collection of considerations to make your move to the US from Canada less painful.
1. Find a community
Having a cohort of people you can share your experiences with and learn from is invaluable to reducing the anxiety and burden of moving. Look into your network and find people you may know who have already carved a path and can give you advice.
You can also find communities online. Through word of mouth, we found the Young Microsoft FTEs group that is very active. You can gain insight from the Q&As by other people. Ask your network for resources or community groups that are available to help you with the relocation process.
2. Get cross-border banking
Before moving to the US, I wanted to avoid paying foreign exchange rates and having to carry cash as much as possible. Through some research online, I found the RBC cross-border banking bundle that provided a no-annual fee checking account (for one year) and a no-annual fee US credit card that can help you start building your US credit history. Once you receive your SSN (Social Security Number), call RBC to add your SSN. This process will update your credit history retroactively.
Some of my friends have a Canadian American Express credit card, which has no foreign exchange rate fees when purchasing in USD. However, the AMEX credit card is a charge card that doesn’t build US credit.
Since Canadian credit scores can’t transfer into the US, we will be building credit from scratch again. Once you’ve settled in, I recommend to sign up for a US credit union or bank to take advantage of perks and sign up bonuses. An advisor informed me to open a no-annual-fee personal line of credit. Unused, it will still report the account as "paid in full.” Some of the factors in building credit include
- The length of your credit history based on the oldest credit account age
- Credit utilization
- Payment history
3. Close your TFSAs, keep your RRSPs
In general, it is recommended to close your TFSA before the day you enter the US. TFSA accounts are subject to tax in the US because they are considered foreign trusts and require additional tax reporting. You must pay US income taxes annually on the income and capital gains in a TFSA. The IRS also generally applies a withholding tax of 15% (sometimes 30%) on dividends paid to a TFSA. The IRS recognizes RRSP accounts as tax-deferred retirement accounts under the Canada-US tax treaty. In an RRSP, US dividends aren't subject to a withholding tax. However, when you withdraw from an RRSP as a US resident, you are subject to a 25% withholding tax.
4. Transfer CAD to USD with Wise
With the RBC cross-border banking I mentioned above, you can make instant transfers from CAD to USD with a decently lower foreign exchange rate than other big banks. However, Wise (referral link) has one of the lowest foreign exchange rates we found. It can be helpful to transfer money ahead of time as it may take a few business days to complete the transactions.
Wise helped us bootstrap our initial checking account with USD before we got our first paycheck from our new roles, which you will usually receive at the end of your first month. This timeframe can be too long when you have so many bills to pay upfront when moving. It is also important to have liquid cash if you decide to rent and sign a lease. Some landlords or property owners require you to pay 1-2 months of rent upfront to offset the risk of not having credit and a social security number.
5. Find a place to live
If your company provides a relocation benefit, you usually have two options: relocation assistance or a lump sum of money. The answer on which to choose is entirely situational and for you to consider. If you are low maintenance, have no dependants, or have a high tolerance to risk, you may want to consider the lump sum to have extra cash.
Relocation assistance can be helpful because you can take the time to settle into your new role and lifestyle before committing to a home or apartment that satisfies you.
Depending on your relocation benefits, you may receive
- An assistant that will help you find a home to purchase or a place to rent based on your preferences. Your experience will vary based on the assistant. Don't rely entirely on the assistant to have due diligence. You are ultimately responsible for your own search.
- 1-2 Months of corporate housing. It may be possible to extend this depending on your circumstances. Beware: this is a taxable benefit, which can be a surprise on your first paycheck.
- 1-2 Months of a rental car. This perk is a taxable benefit too.
- Vehicle import reimbursement. Some companies will pay to help you permanently import your vehicle into the US.
Whichever choice you pick, don't underestimate the amount of time it takes to settle in. Try to schedule your start date with an ample buffer to look for a place. See the homes or apartments in person and feel the neighbourhood vibes. Attempt to request your recruiter or hiring manager to sponsor a home or apartment hunting trip, especially if you have accepted relocation assistance.
When you're looking for rent without a social security number and no credit history, you may be required to provide an additional 1-2 months of rent on top of your security deposit. In some instances, you may need to pay an additional monthly fee until your lease ends instead. Some apartments also require your gross salary to be more than a multiplier of your monthly rent (eg. 15x monthly rent).
6. Park your Canadian phone number
One of my biggest concerns about moving to the US was losing accounts I have access to because of multi-factor authentication via SMS. Not only that, but I wanted access to my phone number in case I forgot to migrate important contact information.
My girlfriend discovered Numberbarn, where you can transfer and port your Canadian phone number and park it there. It is $2 USD/month and well worth the money to smoothen the transition to the US. The best feature is that you get emails on missed calls and SMS messages.
7. Get your most important documents ASAP
Once you have officially crossed the border and moved into your home, you should complete these tasks ASAP.
- Visa & Immigration: Complete any remaining visa or immigration tasks, like going to a USPS to file your Form I-9 as they have urgent deadlines.
- Social Security Number: Apply for your SSN ASAP. There is a 2-week window before you receive your SSN. It is essential for some services like opening a bank account, getting a credit card, getting a loan for a car or home, certain apps like Venmo (referral link), and company payroll.
- Driver license & vehicle plates: If applicable, get your new driver license and vehicle plates. Look up the registration process for your state. For example, in Washington state, you must get your Washington driver license, then register your vehicle within 30 days after you have moved into the state.
8. Look for company benefits and perks
If you are working for a big company, try to take advantage available benefits and perks. With Microsoft, it was helpful to sign up with a partner federal credit union called First Tech (use referral code: FT31049JackieL) to get started with a checking account, a no-annual-fee credit card, and a decent pre-approved vehicle and home loan. The pre-approved loans can help ease your move tremendously, especially when you have no credit history.
Other perks include discounts at telecom providers for phone plans, general shopping, and dining out. Every little bit helps, especially when you will be paying for things where you did not anticipate when moving.
9. Understand your visa limitations
For the visa class you have, make sure you understand the limitations of your visa. For instance, if you have a TN-1 visa and your spouse is relocating with you, you must consider TD visa (TN Dependent) limitations. People on TD visas are not authorized to work while in the US. On an L-1B visa, your spouse is authorized to work in the US without additional sponsorship from a US employer. Learn more about the L-1B visa petition process and tips on my girlfriend's blog.
For all employer-sponsored visas, you are only authorized to do the work you were sponsored for while in the US. You can start a business, but you can only operate your business in the limited scope permitted by your visa. If you manage day-to-day activities for your business while on a visa, your visa may be revoked.
10. Consider your long-term future in the US
Moving to the US is a big decision. Another big decision is whether to apply for a green card for permanent residency through an Adjustment of Status. If you are working for a big company, they may help you in this application process. There are special issues and restrictions before submitting your green card application.
On a non-immigrant visa, you cannot travel outside the US. You can risk nullifying your green card application, denied re-entry into the US, and possibly have your visa revoked. It appears that you can apply for a "Advance Parole" Form I-131 travel document that enables you to travel outside of the US with permitted re-entry for certain circumstances. A green card can take anywhere from 10 months to several years to be processed and the I-131 can take anywhere from 6 to 12+ months.
Before you commit to a green card, you should also be aware of the tax obligations that can impact your future decisions. As a green card holder, you generally are required to file a US income tax return and report worldwide income no matter where you live. If you surrender your green card, there is an exit tax if you are considered a long-term resident (green card holder for 8 of the past 15 years). The exit tax is calculated against your net worth and can be a large surprise to the unaware.