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I am relocating to Texas from India along with my family in the month of July 2019 to pursue a Phd. In order to effect a smooth transition, would like some advice on how to setup things to manage my first month seamlessly. I have the following doubts:

  1. My current assets are in the form of cash and equities. What is the best way to manage these assets going forward? I'm assuming I will have to convert my current savings accounts into NRO + NRE accounts and manage the equities through the PIS account. If anyone could help out on timelines of this process - would be great.
  2. I would want to land in US with a certain seed amount - say $10k. What is the best way to do this? I would want to take this seed money from my current accumulated capital. Should I just convert into cash through a broker and carry, or is there a better way?
  3. How much time does it take to open a bank account in US? And what is the best way to transfer the money that I have in India to US? And what would be the tax implications for the same?
  4. What happens to existing credit cards that I hold? Should I cancel them?

Any additional information would be incredibly useful. Thanks!

  • It's worth pointing out that if you carry $10k USD or more in cash or cash equivalents into the US, you must declare it to customs or you'll be in a lot of trouble. See the FinCEN form for more info: fincen.gov/sites/default/files/shared/fin105_cmir.pdf – dwizum yesterday
  • @dwizum - there are at least 2 persons given the OP indicated that they will fly in with their family. This $10k limit is per person and so they may be fine. – perennial_noob yesterday
  • @dwizum: if he is coming over with his wife, kids, or parents.. he can break that 10k up easily to somehting smaller.. – sofa general yesterday
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    quoting here for posterity: Please be aware, if persons/family members traveling together have more than $10,000, they cannot divide the currency between each other to avoid declaring the currency. For example, if one person is carrying $5,000 and the other has $6,000, they have a total of $11, 000 in their possession and must report it on a FinCEN 105. If a person or family fails to declare their monetary instruments in amounts more than $10,000 their monetary instrument(s) may be subject to forfeiture and could result in civil and or criminal penalties. – dwizum 10 hours ago
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    There is no duty on importing currency, regardless of the amount. Really, the goal of forcing people to declare large amounts of cash is to help identify money laundering, currency smuggling, and other illegal activities. They're trying to create a paper trail to help investigate criminals, they're not trying to harass a PhD student. If you are bringing in legitimate cash and you declare it, and you have no red flags, the customs agent interviewing you isn't going to care. – dwizum 10 hours ago
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As a has-done-it I'd like to attempt answering. Please feel free to ask for clarifications/edits if I miss anything.

How much time does it take to open a bank account in US? And what is the best way to transfer the money that I have in India to US? And what would be the tax implications for the same?

It is usually a same-day process esp going through a University Credit Union. Find out if you have one or more options to choose from. Irrespective of how soon you may want to open an account with a bigger bank, you should open one with a Credit Union because they have lesser restrictions and low fees (they are banks but they are not for profit and intended to serve local community members. You'll qualify because you'll be a student at that univ).

As for bigger banks, they may need more documentation and opening an account with them may take more than a day (or not). Also over the years I have found it easier to maintain and manage online-only bank accounts like Discover, Barclays, etc but you could take your own decision on that.

What happens to existing credit cards that I hold? Should I cancel them?

The Indian credit cards, well, if there is no annual fee and there is a chance you may want to use those, then leave them alone. More importantly, you should definitely see if you are able to convert one or two of them (preferably one each of Visa and Mastercard) to a 0% International fee.

This way you could carry these en-route and also use within the first month or a few months until your credit cards in the US are available. This also helps avoid carrying a lot of cash and going through potential declaration at the US customs. I have observed that when you swipe a card internationally you get marginally better exchange rate than if you were to exchange or wire the money on that same day.

I would want to land in US with a certain seed amount - say $10k. What is the best way to do this? I would want to take this seed money from my current accumulated capital. Should I just convert into cash through a broker and carry, or is there a better way?

Refer the above point. You could still carry a cash equivalent of perhaps $5000 or $2000 based on your comfort so that you could deposit this amount when you open your first account or two. (I personally would not be comfortable carrying $10k but you are traveling with your family and so you could distribute the cash between each member.)

You could get this cash from a standard place like SBI (State Bank of India) or other brokers. If you can find someone in your friends/family/acquaintances who need INR (on their visit here or for their future visits) you could exchange for a mutually favorable rate instead of losing money with the broker (they offer less than prevailing rate btw).

My current assets are in the form of cash and equities. What is the best way to manage these assets going forward? I'm assuming I will have to convert my current savings accounts into NRO + NRE accounts and manage the equities through the PIS account. If anyone could help out on timelines of this process - would be great.

My best recommendation is to leave some money in the hands of a trusted family member. If you anticipate a trip back to India in a year or two you could think about converting your accounts to NRO/NRE then. I am hazy on if you can convert your account to NRE/NRO while you are still in India. This can be better clarified by a bank manager at your nearby branch.

(On this point, it is a good idea to also leave a General Power of Attorney (GPA) with such a person. If you are not comfortable, you could work on a Specific Power of Attorney to entrust them with specific things like account maintenance, updates, etc or more actions like withdrawals, deposits, etc)

In the long run you should be aware that if you plan on maintaining balances/investments in India once you start paying taxes in the US, you'll be taxed on interest/profits for the Indian funds in the US too. That's also why it may be a reasonable idea to park excess funds with a trusted family member.

Of course if you use your International credit card from India then the bills could be paid from your existing Savings account and within a few months you'd have used a significant portion of the seed money. That way there wouldn't be tax implication and you wouldn't have lost money in transferring it to the US.

Good luck as you start your PhD!

  • I would also add that it's better to go through a university credit union (if there is one), or to ask the advice of the university's international student office, simply because they will have done it for many others, and so will be familiar with the process. Also, you might want to carry the money as a bank check or even traveller's checks, to insure against the chance of loss or theft. – jamesqf yesterday

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