Wealth preservation for foreign nationals
Strategies to help maintain and protect your US-based assets from inflation, taxes, and other risks to family wealth.
Last updated October 24, 2025
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It takes one set of skills to grow wealth, and another set of skills to preserve wealth. Wealth preservation strategies can help safeguard the personal and family assets you've worked hard to build and protect them from potential risks like economic downturns, inflation, and taxes. Prudent, calculated decisions that mitigate risks and maximize returns are the key to ensuring long-term growth and stability. It's important for all high-net-worth individuals, but can be especially challenging for foreign nationals, who may face unique tax issues.
Get help from a team that understands the challenges faced by foreign nationals
Comprehensive planning is essential to navigating the complexities of cross-border investment, tax obligations, and estate management within the US legal and tax framework. Life insurance can play a key role in that process. The Guardian Global Citizens Program provides concierge life insurance services for foreign nationals with significant financial and family ties in the US and other countries.
Who counts as a foreign national in the US?
A foreign national is typically defined as a person who resides in this country but is not a citizen. However, for the purposes of wealth management, a foreign national could also include a non-citizen who lives abroad but has significant financial or family ties in the US. Also, expatriates – Americans living abroad – are often treated as foreign nationals by financial services and life insurance companies, at least in terms of the products and services available to them.
It’s important to note that immigration status and tax status are distinct. For example, relinquishing a green card or citizenship does not automatically end U.S. tax obligations. Individuals may have different tax statuses depending on their residency and citizenship, which can affect their obligations for income tax purposes. And critically, when it comes to taxes, foreign nationals are generally treated differently from citizens of the country in which they live. Because they have financial interests that span multiple jurisdictions, wealth preservation for high-net-worth foreign nationals comes with unique challenges.
Wealth preservation issues specific to foreign nationals
The financial landscape for foreign nationals can be quite complex due to a range of tax implications, restrictions, and regulatory requirements. But awareness of these tax rules is the first step to navigating these complexities and optimizing financial outcomes. Key issues include:
Citizenship-based taxation
Most countries have residency-based taxation, meaning that individuals are taxed on their income that is earned or sourced from the country in which they reside. The United States is one of the only countries with citizenship-based taxation – US citizens are taxed on their worldwide income, regardless of where they live.1 This can result in double taxation for US expats and foreign nationals alike. For example, an expat who works abroad and earns $100,000 may be taxed by their country of residency and the US government. Or, a foreign national who owns a US business (or has US investments such as stocks and bonds) will be taxed on the income from those holdings by the United States, even if they do not live in this country. There are other tax implications as well, for example, when it comes to estate and inheritance taxes.
There are a number of tax treaties in place between the United States and other countries that can help to reduce double taxation, mitigate tax consequences, and minimize estate tax liability. However, tax treaties can be complex, and it is important to seek professional advice to ensure compliance with US tax laws.
Foreign Account Tax Compliance Act (FATCA) and Common Reporting Standard (CRS)
FATCA is a US tax law that obliges foreign financial institutions to report accounts held by US taxpayers or by foreign entities where US taxpayers have significant ownership. Failure to comply may result in hefty penalties and withholding taxes.
CRS is a similar international standard for the automatic exchange of financial account information, designed to combat tax evasion. It involves over 100 countries and territories, requiring financial institutions to collect and share information about accounts held by residents of other participating countries.
Both FATCA and CRS increase the reporting requirements and administrative burden for foreign nationals who hold financial accounts abroad. Proper tax planning and compliance are essential to avoiding penalties and ensuring all obligations are met.
Taxation of non-US accounts
Foreign nationals may be subject to US taxes on their accounts – for example, on dividends paid by US companies2 – even if they do not live in the United States. Conversely, even if they live primarily in this country, high-net-worth foreign nationals tend to also have holdings outside the United States, including non-US mutual funds and hedge funds, foreign trusts, non-US businesses, and other holdings. The Internal Revenue Service may classify some of these foreign investment products, as passive foreign investment companies (PFICs), which are subject to complex rules and reporting, as well as high rates of taxation. This can be a complex issue, and it is important to seek professional advice to ensure you comply with all applicable tax laws as you look to minimize tax liabilities.
Using US-based life insurance for wealth preservation
Life insurance — and in particular, permanent universal or whole life insurance that can build cash value3 — may provide a number of estate planning advantages for foreign nationals, starting with a death benefit that can be used to help preserving family wealth. The fact is, favorable tax treatment means that a properly structured life insurance policy can offer significant tax benefits, making it a key component of a comprehensive financial strategy.
Overcoming the estate tax disparity: While US residents enjoy a federal estate tax exemption of $13,990,000 (for 2025), the exemption for non-residents is limited to just $60,000.4 Non-resident life insurance can help bridge this disparity, because death benefit payments are generally exempt from federal estate taxes. This feature makes life insurance proceeds an attractive wealth-transfer vehicle for many foreign nationals with US-based assets.
Covering potential estate taxes with life insurance: The US government imposes estate taxes on worldwide assets for US citizens, and on US-situated assets for non-residents.5,6 US-denominated life insurance can help provide the liquidity needed to cover potential estate taxes without having to sell all or a portion of these holdings, preserving the estate's value for heirs.
Portfolio diversification and risk mitigation: Permanent, whole life insurance builds cash value at a guaranteed rate and is among the more conservative financial products available. A policy can build US-denominated assets that can be accessed while the policyholder is still alive, potentially acting as a buffer against economic downturns in one's home country, fluctuating exchange rates, and other forms of geopolitical risk.
Asset protection: Life insurance policies are generally protected from creditors and bankruptcy. This can provide an additional layer of protection for foreign nationals' assets.
The Global Citizens Program
Guardian provides specialized life insurance solutions and services designed to meet the unique demands of high-net-worth international clients. Our Global Citizens Program allows qualifying clients to tap into a dedicated team that specializes in the more complex financial protection needs of clients with multinational interests. The program provides white-glove service with the backing of one of the world's largest mutual life insurance companies, with access to coverage options that fit your unique circumstances. Clients must be non-resident, non-US citizens who demonstrate financial connections, holdings and/or family ties in the US. A dedicated case concierge team is assigned to help each applicant, and submissions are evaluated by specialized underwriters. Other amenities include a complimentary US trust review, translation services, law firm referrals, and more. To learn more, contact a Guardian financial professional.
Get help finding the right life insurance solution for your situation
If you're a foreign national with US residency, a Guardian financial professional can help you explore the range of coverage options available. Or, if you're a non-resident with ties to the US, ask about the Global Citizens Program.
Wealth preservation methods vary, but they often involve working with one or more financial professionals to implement a mix of the following strategies:
Diversification of assets across sectors and geographies
Utilizing tax-efficient investment vehicles
Estate planning and using trusts or insurance products designed to help minimize tax liabilities
Wealth preservation refers to strategies aimed at safeguarding assets from various risks like market volatility, inflation, and taxation. It involves the prudent management of financial resources designed to help ensure their growth and stability over the long term.
Wealth accumulation is where assets are actively accumulated, and this often involves higher levels of risk and aggressive investment strategies. Wealth preservation, on the other hand, is the management of existing assets designed to help ensure their safety and longevity, often by reducing exposure to risk and implementing tax-efficient strategies.
Tax system complexity: Navigating multiple tax systems, each with its own regulations and rates, is a significant challenge.
Financial reporting: Complying with FATCA and CRS mandates extra diligence in financial planning and reporting.
Double taxation: The risk of being taxed twice on the same income can occur, although some countries offer tax credit mechanisms or have estate tax treaties to mitigate this.
Business interests: Maintaining business interests across borders can expose foreign nationals to varied and sometimes volatile financial systems.
Estate and inheritance: Proper planning is essential to navigate differing inheritance laws for family members across jurisdictions.
Tax benefits: Life insurance proceeds are generally tax-exempt, offering relief from the US tax system and sometimes even providing tax credit benefits for foreign nationals.
Liquidity and estate planning: Permanent and term life insurance can both provide immediate liquidity to cover potential estate taxes.
Income: Permanent life insurance policies include a cash value component, which can be accessed as a form of tax-deferred income.
Diversification: Cash value life insurance is a conservative asset that can complement a diversification strategy.
Family considerations: Proper planning through life insurance can help ensure financial confidence for family members, fulfilling both immediate and long-term needs.
1 Frequently asked questions (FAQs) about international individual tax matters, Internal Revenue Service, September 18, 2025.
2 Do Non-U.S. Citizens Pay Taxes on Money Earned Through a U.S. Internet Broker?, Investopedia, August 28, 2025.
3 Whole Life insurance is intended to provide death benefit protection for an individual's entire life. With payment of the required guaranteed premiums, you will receive a guaranteed death benefit and guaranteed cash values inside the policy. Guarantees are based on the claims-paying ability of the issuing insurance company. Dividends are not guaranteed and are declared annually by the issuing insurance company's board of directors. Any loans or withdrawals reduce the policy's death benefits and cash values and affect the policy's dividend and guarantees. Whole life insurance should be considered for its long-term value. Early cash value accumulation and early payment of dividends depend upon policy type and/or policy design, and cash value accumulation is offset by insurance and company expenses. Consult with your Guardian representative and refer to your whole life insurance illustration for more information about your particular whole life insurance policy.
4 US estate and gift tax rules for resident and nonresident aliens, Deloitte, 2024.
5 Estate tax considerations for non-US persons owning US real estate, The Tax Advisor, April 30, 2025.
6 Estate tax for nonresidents not citizens of the United States | Internal Revenue Service, May 22, 2025.
Guardian, its subsidiaries, agents, and employees do not provide tax, legal, or accounting advice. Consult your tax, legal, or accounting professional regarding your individual situation.