US Citizens are taxed on their worldwide income, even when living abroad.
Tax advantages for contributing to local retirement plans may therefore not benefit US Citizens, especially if the tax rate of their residing country is lower than their US tax rate.
Further 401k's held in the US will be controlled by their former employers.
By opening up an individual retirement arrangement (IRA) account, you can continue to take advantage of US tax benefits, whilst having your funds managed in accordance with your personal requirements, market circumstances and with lower costs.
401k's held by former employers can be “rolled” into an IRA, IRAs can continued to be paid into whilst living abroad.
ROTH (after tax assets) accounts are usually preferable due to higher marginal tax rates during the working life and the ability to avoid state taxes whilst living abroad.
Simplified employee pensions (SEP) are available for business owners and their employees.
Disclosure: Steven J Cohen CFA is licensed in both Switzerland (under the provisions of FINMA) and US SEC exempted to act as a consultant, provider and manager of 401k's, IRA's, ROTHS's and SEP's.
Phone: +41 (0)7675 36738