In the United States, testamentary freedom is broad: you can generally leave your assets to whomever you choose through a will or trust, subject to spousal elective share rights in community property and common law states. Portugal operates under a fundamentally different framework. Portuguese succession law includes legitimate heirs (herdeiros legitimarios) — typically the surviving spouse, children, and parents — who are entitled to a mandatory share (legitima) of the deceased’s estate regardless of what the will says. This forced heirship provision can override testamentary wishes for assets subject to Portuguese jurisdiction.

The interaction between US and Portuguese succession law creates complexity that does not exist for Americans living exclusively in the United States. If you establish Portuguese financial residency and hold assets in both countries, the question of which country’s succession law applies to which assets becomes critical. EU Regulation 650/2012 (the Brussels IV Regulation) generally applies the succession law of the deceased’s habitual residence to their entire estate — meaning that if you die as a Portuguese resident, Portuguese forced heirship rules may apply to your worldwide assets unless you have made a specific election in your will choosing the law of your nationality (US law) to govern your succession.

This nationality election is the single most important financial planning action for Americans establishing Portuguese residency. By including a clear clause in your will stating that US law (specifically the law of your US state of domicile) should govern the succession of your entire estate, you can override Portuguese forced heirship and maintain American testamentary freedom. This election must be explicit, properly documented, and ideally prepared by an attorney familiar with both US estate law and EU Regulation 650/2012.

Retirement accounts (IRAs, 401(k)s, Roth IRAs) and life insurance policies pass to named beneficiaries outside of probate in the United States. These beneficiary designations generally override the will — the beneficiary named on the account receives the assets regardless of what the will says. For Americans living exclusively in the US, this system works cleanly. For Americans with Portuguese residency, the interaction between US beneficiary designations and Portuguese forced heirship creates potential conflict.

If Portuguese succession law applies to your worldwide estate (because you are a Portuguese resident who has not made a nationality election), the forced heirship claims of your spouse, children, and parents could theoretically extend to US retirement accounts and life insurance proceeds. While enforcement across jurisdictions is complex and the practical risk is debatable, the possibility exists and should be addressed through proper planning. The nationality election in your will, combined with explicit beneficiary designations on all US financial accounts, provides the strongest protection against unintended Portuguese succession claims on US assets.

Before moving to Portugal, review all beneficiary designations on retirement accounts, life insurance policies, and transfer-on-death accounts to ensure they reflect your current wishes. Update any outdated designations (former spouses, deceased beneficiaries, adult children who have reached financial independence). Ensure that contingent beneficiaries are named in case the primary beneficiary predeceases you. These updates are standard financial planning hygiene but become more urgent when cross-border succession law introduces additional complexity.

Before your Golden Visa residency card is issued or before you spend enough time in Portugal to trigger financial residency, complete the following financial planning actions. First, update your will to include a nationality election clause specifying that US law governs the succession of your entire estate under EU Regulation 650/2012. Second, review and update all beneficiary designations on retirement accounts, life insurance policies, and transfer-on-death accounts. Third, if you hold assets in US trust structures, consult with a cross-border attorney about how those structures interact with Portuguese law and whether Portuguese assets should be held outside the trust.

Fourth, prepare a Portuguese-format power of attorney (procuracao) designating a trusted individual with authority over your Portuguese financial and administrative affairs. Fifth, prepare and register a Portuguese healthcare directive (testamento vital) if you plan to spend significant time in Portugal. Sixth, review the titling of all assets in both countries to ensure consistency with your estate plan and to minimize cross-border succession complications.

Seventh, if you hold Portuguese property or are considering purchasing property in Portugal, consult with both a US estate attorney and a Portuguese notary about the optimal ownership structure. Joint ownership between spouses, individual ownership, or corporate ownership each have different succession implications under Portuguese law. Eighth, discuss the US estate and gift financial considerations of your Portuguese assets with your financial advisor — the US estate financial exemption ($13.61 million per individual in 2026) applies to worldwide assets, and the US-Portugal tax treaty includes provisions for avoiding double estate regulation.