Ten Top Financial Advisors For Expatriate Investors

top-ten-financial-advisors

 

 

Each week, millions of expatriates build small backyard fires. 

They pull out matches. They take $10 bills out of their pockets. Then they burn them. Every week. Every month. Every year.

 That’s what it’s like when you pick the wrong kind of financial advisor. Before hiring anyone, ask these questions.

  1. Can I Sell My Investments At Any Time Without A Penalty?

If the firm says no, run. This is non-negotiable. Firms like Friends Provident, Zurich International, Royal London 360, Generali Worldwide, Hansard International, Alexander Beard and Old Mutual (Royal Skandia) offer products with high fees and long lock-in periods. Avoid such products.

  1. Do you invest only with low cost index funds or ETFs?

If the advisor says no, walk away. Some active funds do beat their benchmark indexes. But nobody can consistently pick such funds ahead of time. Looking for the funds that have done well in the past is a bad idea. Each year, S&P Dow Jones Indices publishes The Persistence Scorecard. Their data shows that actively managed funds with strong track records rarely keep winning. Low costs are better predictors of strong fund returns. That’s why index funds or ETFs give the best odds of success.

  1. How do you earn your money?

Don’t hire an advisor who gets paid commissions. They could be choosing investments based on how well these products help them make their Mercedes payments. David Melnyk, a Financial Planner with Florida-based Verus Wealth Management says that the fee-only model is better at aligning client interests with those of the advisor. “Advisors typically charge their fees by a percentage of their clients’ assets, commonly 1 percent annually. When the portfolio’s value falls, the client pays a smaller advisory fee. This model gives advisors every incentive to grow portfolios while also reducing investment risk.” If you don’t know exactly what your fees are, or you think the advice is free, you are probably the victim of a hefty commission.

  1. Can experts predict where stocks are headed?

If an advisor answers yes to this question, move on. Nobody knows whether stock markets will rise or fall this year or next. “If an advisor says they can forecast the market’s direction, that’s immoral,” says Paul Ruedi, of Ruedi Wealth Management Inc. “It puts any serious financial plan in jeopardy.” There’s no room for a foolish fortune teller in your portfolio’s future.

  1. Can I see a model financial plan and portfolio?

There are two reasons you should ask for these. When an advisor explains something, you need to understand it. If you don’t, it’s not your fault. It’s the advisor’s problem.

What the advisor says about the sample portfolio is also important. They shouldn’t try to wow you with past returns. Instead, the advisor should stress the importance of asset allocation, diversification, and rebalancing. “A definitive allocation and rebalancing policy will help deal with the uncertain outcomes of the various asset classes,” says Jim Winkelmann, of Blue Ocean Portfolios, LLC. “Every major pension plan, endowment and high net worth investor has well developed and relatively simple allocation policies.”

  1. What credentials do you have?

There are many financial advisory credentials. The Certified Financial Planner designation (CFP) is the most rigorous. Jamie P. Menges, of PDS Planning, Inc. says, “the CFP® designation is important because it shows not only intellectual competency, subscription to an ethical paramount, and an integrated fiduciary standard, but it ensures they are working with an advisor committed to his or her profession in the most basic way.”

  1. Is The Firm Fully Regulated?

Ensure that the firm you deal with is properly authorized for the services it delivers. Sam Instone of AES International says, “The international market is jam packed full of charlatans.  Most have been kicked out of tighter regulatory environments.  Check the adviser’s website for a regulatory number and then double check this on the publically available register in that country.” Ensuring high quality regulation can mean independent recourse if things go wrong.  It can also provide potential benefits such as professional indemnity cover, qualification checks and strong corporate governance. Never invest a penny without checking this first.

  1. Do They Use Separate Platforms For Americans and Non-Americans?

Some investment firms offer the same funds for their American and non-American clients. Run from such firms. If non-Americans buy U.S. domiciled funds, their heirs can get slapped with a hefty tax bill. If Americans buy non U.S. domiciled funds (even if they’re Vanguard funds domiciled offshore) they attract crushing levels of tax or the possibility of the investor running afoul of the IRS.

Below, you’ll find ten financial advisors that I recommend for expats.

 

Index Fund Investment Advisors / Firms For Americans

Firm

Annual Portfolio Management Fee

Minimum Required

Index Fund Advisors

0.9% (for accounts below $500,000)

$100,000

RW Investment Strategies

0.3% to 0.4%

$10,000

Creveling & Creveling

1.2%

$750,000

Evanson Asset Management

0.4% to 0.5%

$500,000

Tony Noto Financial Planning

1%

$250,000

Plan Vision

$96 / year

No minimum

 

 

Index Fund Investment Advisors / Firms For Non-Americans

Firm

Annual Portfolio Management Fee

Minimum Required

AES International

(Based in Dubai)

1.25%

$75,000

Index Fund Solutions

(Marc Ikels Consulting)

1%

$500,000

WealthBar

(for Canadians only)

0.35% to 0.6%

$5000

Satis Asset Management

(British investors only)

0.9%

(drops after first million GBP)

500,000 GBP

 

 

 





Andrew Hallam

I’m a financial columnist for Canada’s national paper, The Globe and Mail, as well as for AssetBuilder, a financial service firm based in Texas. I’m also the author of Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School (Wiley 2011) and The Global Expatriate’s Guide To Investing: From Millionaire Teacher to Millionaire Expat (Wiley 2015). My mission is to educate, motivate and inspire people on basic retirement planning and best practices for investing, using evidence-based strategies. I'm happy to comment on your questions. However, please read the Terms of Use.

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138 Responses

  1. Scott says:

    Any thought on Wealthfront?

  2. Scott says:

    We currently require all Wealthfront clients to have a U.S. social security number or U.S. Tax ID Number and reside at a permanent U.S. mailing address due to financial regulations.
    That solves that dilemma – I’ll stick with my TDInternational Account!

    Thanks Andrew

    • Scott, TD Direct International is for non Americans only. Wealthfront is for Americans only. So…I suppose you couldn’t have used them, even if you had wanted to. I’m guessing, because you have an account with TD Direct International, that you are not an American.

      Cheers,
      Andrew

      • Scott Langston says:

        Yep, UK national living in China. Finding TDInternational a breeze to use following many of your recommendations. Adopting a kind of couch potato approach with one or two stocks thrown in. They also now have an options account, which I’m investigating to use to sell puts on stock I’d like to pick up anyway…I’m not sure if I have understood the process properly yet, but it sounds intriguing.

        • Hi Scott,

          I’m glad you found a good platform with TD. However, don’t let them sucker you into buying and selling options. Long term, you will lose. Long term, the brokerage will win. I guarantee it.

          Cheers,
          Andrew

  3. Index says:

    Andrew, I am a British national resident in Dubai. I’m looking to build a portfolio of ETFs – can you recommend an online brokerage? Ideally i’d like to be able to access Vanguard products including their life balance and targeted retirement products.

  4. Index says:

    Andrew,

    Thanks for this. I have also been looking at Saxo Bank’s platform. How do you rate this against TD Direct International?

    Cheers – Index

  5. toony says:

    Andrew,

    While these are great questions for everyone to ask when searching for a financial advisor, I believe these may give expats a false sense of security (especially in the UAE and DeVere!)

    DeVere have prepared their salesmen well to counter these and have also developed techniques when advisors need to stretch the truth *blatantly lie*, to secure the deal – I have personally seen many of the following techniques used first hand.

    Things the salesmen are taught:
    1. If stretching the truth, do it verbally, face to face and dont leave paper trial.
    2. Switch client with another salesman after signing – allows them to cover each other if clients complains about being told completely wrong thing “Oh, I’m sorry but I wasn’t there at the meeting. You make have misheard about no fees/restrictions, etc but you did sign the forms acknowledging you were told of and understood all the fees!”

    This is how your 8 questions would be answered by DeVere to trap expats.

    1. Sell investments any time without penalty
    “You can sell, change funds or even take a holiday break without penalties – the plan is very flexible to your changing needs” (They ‘forget’ to mention no direct penalty this is only for accumulation units after the ‘initial’ period but the general and background fees are still roaring along eating into your savings. If called out about the lie, “what I told you was truth with your accumulation units – there’s no direct fees!”

    2. Invest in low cost index funds or ETFs.
    “We only invest in the BEST funds with the most respectable companies (pulls out list of well known financial companies eg Morgan Stanley) and recommend 5* funds which are independently assessed by M* (pulls out latest M* ratings report). Index funds are rubbish, here’s a list of funds that great outperform index funds (points to M* list again).”

    They greatly rely on 99.9% of people not understanding how index funds perform AND how ‘regression to the mean’ for active funds make the M* rating useless as a predictor of future performance.

    3. Earn money/commission from products?
    “I’m paid a standard wage, no commission at all. We are the worlds biggest IFA and I can assure you our advice is completely unbiased and offer only the best funds for you. My job is to find you the best funds for the lowest price (*flash a smile*)”

    This is really blatant by DeVere. They will always deny they are working for commission or how much they are paid etc, even when asked directly (which is illegal in most other countries like Aus, UK, US etc but can get away with it here with no repercussion). When directly confronted about the lie, it’s “we didn’t lie, the company pays DeVere and DeVere pays us monthly”

    Part 2 shortly

    • Oh well, at least I mentioned the names of firms to avoid. If they see one of those names on what they sign, hopefully they’ll stop.

      Cheers,
      Andrew

    • toony says:

      Part 2

      4. Experts predict where stocks are headed?
      Yup, they use the same arguments you list in your books about how they can beat the market
      “largest IFA with lots of researchers…” Making broad statements that sounds plausible like “…aging population so we expect the health care sector to outperform the market…”

      (Side note, the salesmen tends to stuff people’s portfolio not necessary of current star performers but of companies they have deals with DeVere. Eg, Valais Invest Managment is currently heavily promoted – large front load (4.5%) with ER 1%+ and performance bonus, large buy/sell split, wide currency fees etc. Anyone client requesting help will have their folio stuff full of this fund. The promoted funds pays a large kickback to DeVere/salesmen initially along with a trialing commission for every month they can keep the client in it or add further money!)

      5. Model financial plan and porfolio
      “I’m invested in this plan/funds myself” (mostly a lie to ease concerns of people)

      Sales team always carry tables and mock plans showing 5% or 10% growth scenarios. However, they are never given to clients directly to review so ppl don’t notice the plans and models completely ignore the devastating effects of upfront fees (initial units), ER, front load, currency fund/spread etc

      6. Credentials
      Most straight out lie on this question about their qualification and experience, safely knowing most people don’t know how to check and no repercussion if get caught.

      “Have International licence to give financial advice.” (No such thing! This is basically the 2 weeks sales course DeVere put them on before shipping them out. It’s so basic that my dog managed to pass and it died years ago!)

      I think there’s currently only 1 or 2 people from DeVere in Dubai/Abu Dhabi that are qualified to either US/Aus/UK standards but they are in compliance and aren’t on the ground selling things.

      My best advice in this area to see through all the lies is to print a generic ‘fiduciary’ letter and request the advisor sign it before any dealing! Ps. I did this recently with a guy named James Wickington. You should see the tantrum and how much he flipped out!

      7. Firm fully regulated
      The salesmen will claim DeVere is ‘fully’ regulated etc and have ‘won’ many pretegious awards *cough* bs *cough*. Unfortunately it takes a very experienced person to verify this info. Many people don’t know that DeVere has been kicked out of many countries or why they move from London to get away from the UK regulators, and their claims in this area is not worth the piece of paper it is printed on.

      The odds are truly against the average expats!
      Andrew, I appreciate all the work you do to educate people and warn them against unscrupulous financial dealers and will endevour to help where ever I can.

      Ps. I’m surprise that DeVere haven’t legally harassed you about all the stuff you have written that mentions them!

      • Oz says:

        Hi Toony,
        This is gold!! Id have loved to have been a fly on the wall during your showdown with Mr. Wickington!
        I’ve looked online to try and find a “generic ‘fiduciary’ letter” with no luck, could you point me in the right direction? There is a particularl persistant FA I’d like to try this with!!

        • toony says:

          I can’t find the letter I copied from – I actually just adapted to what I needed. It was something along the line of:
          .
          I, _____, certify that:
          .
          1. I am authorized to represent and act on behalf of DeVere, (takes away the common ‘plausible deniability’ DeVere alway uses, ie. “he was just a rogue employee”)
          2. I’m a qualified & certified financial adviser* to UK FCA (or related) standards (*make sure it’s adviser and NOT advisor – there’s a legal technicality),
          3. I will disclose all direct and indirect commission & act fiduciary with regards to any financial advice I provide, and
          4. I have no objection to our discussions on financial matters being recorded
          .
          Signed ________
          Dated_______
          .
          That’s all you really need. The experienced salespeople know not to leave a paper trial and start making up excuses. Just follow up with leading questions like:
          “You claim to be working for DeVere, the biggest/largest IFA blah blah blah…but can’t sign to say you work for them? that’s a little unusual!”
          “You said you are a qualified IFA but don’t want to sign a simple statement to say you are qualify to give financial advice? Why would I listen to you?”
          “You are not willing to act fiduciary with me so why should anyone trust you? What are you trying to hide?”
          If they object to being recorded, simply smile and say “I have a bad memory. I don’t want to get anything wrong or misunderstand what you tell me later, especially when I talk with my wife about signing up with you!” *continue smiling*
          .
          Have a couple of copies with you in case they ‘accidentally’ mess it up and bring it out in the middle of conversation. It’s unexpected and derails their sales spiel! I’m sure they will start having heart palpitations and/or remembered they left the iron on at home and rush for the door, leaving you to peace fully drink your coffee!
          .
          Oh, and enjoy the free coffee they provide too! 😉

  6. Index says:

    Andrew,
    I bought your book yesterday and am quickly working my way through it!
    I am a British national, my wife is a Lebanese national. We are both resident in the UAE.
    Do you know if TD Direct International works with UAE residents?
    If not, what is the next best option? Saxo Bank? Any other good options?
    My offshore bank offers a UK based brokerage service but it is limited to ‘most UK listed ETFs’. Any thoughts on using this?
    I am looking to build USD and GBP ETF portfolios.
    Cheers – Index

    • TD Direct International is the better brokerage. It’s cheaper than Saxo, and it has a much simpler platform. TD Direct International also recently lowered their fees. They will allow you to open an account from the UAE.

      Cheers,
      Andrew

      • Marie-Claude says:

        Hi Andrew,
        Swiss quote are actively marketing themselves in UAE. What to you think about there fees and platform?
        Also, we wanted to open our account with Saxo and buy a couch potato portfolio. When we realized that the minimum size of transaction for bonds is 50000Euros, we had to stop there. Our first investment is too small for them. If we want to buy 35% bonds and the rest in stocks, we need a minimum of $72000CAD just for the bonds and a total of $205000 CAD for an initial investment. The minimum of 10 000$USD would be ok if we only buy stocks and ETFs.
        It turned me off.

        • Marie-Claude,

          You would not be buying bonds from Saxo. You would be buying bond ETFs, such as I wrote about in my book. http://bit.ly/globalexpat

          I don’t know much about Swiss quote, but I have personally used at least 12 different brokerages to purchase ETFs (helping other people, I don’t have 12 accounts!) and the Swiss Quote platform, based on the home page, sure looks complicated. I really like TD Direct International.

          • Marie-Claude says:

            Thanks Andrew,
            I am pure beginner and I misunderstood the product. I thought that VSB was bonds and subject to 50000Euros minimum. I already contacted Saxo Bank and I will go forward.

            I appreciated your fast answer! Have a lovely day!

  7. JS. says:

    Hi Andrew, I recently read both your books and loved them. I was completely clueless on investing. I am an expat living in the Netherlands. I see that Vanguard seems to have a local trading web site here. Is it a good idea to build a portfolio directly from them? Is there a caveat? What is the difference than going for the brokerage accounts mentioned in chapter 13? Should I consult a tax accountant? Thank you!

    • JS. says:

      Hi Andrew, is my question non sensical/confusing? Do I need to re read something? My understanding is that Vanguard is the best option for index funds. So I was referring to https://www.vanguard.nl/portal/site/institutional/nl/en/home. I have not contacted them but can’t a DYI build a portfolio directly? Or should I prefer the online brokerage because of the offshore part? What would you recommend for expats in Netherlands? I apologize if my question is not clear. I am newbie in DYI and perhaps still wrapping my head on this. Thank you for your time.

      • Hi JS,

        I could be wrong, but Vanguard Netherlands looks a lot like Vanguard Asia. If they are similar, it means retain investors can’t buy their products directly. They have set up these sites for institutional investors only. You would have to open a brokerage account. From there, you could purchase Vanguard’s ETFs, much as I have described in my book, The Global Expatriate’s Guide To Investing. Here’s link: http://bit.ly/globalexpat

        Cheers,
        Andrew

        • JS. says:

          Hi Andrew. You are right. I contacted them and they directed me to some other agency saying they don’t support DYI directly

  8. David says:

    Hi Andrew…

    Great article once again…

    Recently I have been looking at REITs and have noticed they have performed quite well, especially here in Australia… Currently my portfolio doesn’t include them (my portfolio is 33.3% bonds index, 33.3% local market index, 33.3% international index unhedged),,, Essentially i modelled this portfolio from your great book ‘The Millonaire Teacher’… Although I’m happy with the power and simplicity of the portfolio I have set up, I feel myself getting greedy on the idea of including REITs with the prospect of improving my returns…

    For example, I noticed that REITS offer a 4.5% annual dividend, while the international index offers more like 2%… This makes me feel a bit greedy…

    What is your take on the Andrew?

    Thanks so much for being a great leader…

    Dave

    • Hi David,

      REITs can certainly be a very viable component to your portfolio. I wrote about them here: https://assetbuilder.com/knowledge-center/articles/REITS_HOW_TO_INVEST_IN_REAL_ESTATE_WITHOUT_THE_ADDED_STINK

      However, think hard about what you are asking. You are saying, “REITs have done really well in the recent past, so I want to add them to my portfolio.” Can you see the faulty logic there? If you did want to add REITs, you should be most attracted by horrible recent returns, not strong recent returns. By “recent” I’m referring to any time frame that’s less than the past 10-15 years.

      If you do decide to add REITs, make sure they comprise no more than 10-15% of your portfolio total. When they fall out of favor (and they will, every asset class does) have the courage to add more to maintain your asset allocation. Most people will be dumping them then. But I don’t want you to be “most people.”

      Cheers,
      Andrew

  9. Jen says:

    Hi Andrew

    When buying(I buy every three months) one buys the lagging section. But now I see that this time my allocations are perfect–so should I buy the allocation that has the worst performance (Saxo platform shows how much one has lost or gained-so I buy the one that shows the biggest loss)?

  10. Index says:

    Andrew,

    I just contacted TD Direct International via email and they confirmed they will open an account for me as I am from a ‘low risk’ country (UK) but not my wife as she is from a country that is not low risk (Lebanon). We are both UAE residents. Sounds like nonsense to me. I guess I am left with Saxo or my bank which does only UK trade ETFs (commission only) Any thoughts? Any point contesting this with TD?

    Cheers – Index

  11. James says:

    Index,

    Not Andrew, but someone who’s been knocked back from TD… I actually thought they worked on the basis of risk of country of residence (I am in a “high risk” country) rather than nationality. My spouse and I both have “low risk” nationalities.

    In any case, I have followed up with them and they’ve been terribly nice and polite explaining that my country is not anticipated on their safe list any time soon so I wouldn’t be able to open an account with them…no harm in trying to contest but they seemed pretty stuck to their policies on eligibility (which change regularly by the way, so following up in a few months’ time might give you a different answer).

    I am with Saxo Singapore now and their customer service towards me has been really very good indeed. I know the costs are a little bit higher, but this is still a very acceptable option in my humble opinion.

    James

  12. JS. says:

    Hi Andrew, I have the following I would like to understand:
    In ch. 13 (p173) you say “All you need is a discount brokerage account… Ensure your account is located where government is stable… choose an offshore brokerage where authorities won’t tax…” . I am a bit confused on this.
    1) I assume you mean that my country of residence will not tax the revenue from the offshore account. But if they do tax it what is the alternative?
    2) When we register in these entities eg DBS Vickers or TD do we get some kind of certificate that we own the funds?
    3) If I decide later to use one advisor e.g AssetBuilder can the funds in these accounts be moved freely at any time? I.e to another account?
    4) the discount brokerage account suggested for DYI is not always an offshore account right?
    Thank you for your time.

  13. Index says:

    Does anyone have any experience of using the HSBC InvestDirect International platform?
    It looks quite cheap but it only covers ‘most UK listed ETFs’ (which is probably sufficient for me).
    TDI have turned me down and Saxo looks quite expensive with that 0.12% account charge.
    Cheers – Index

  14. JS. says:

    Hi Andrew,
    On page 175 for DBS Vickers you point out that 15 percent of each dividend is send to the Canadian government and also 1 percent of net dividend per quarter is charged. But these payments are not mentioned in your analytic comparison tables page 180 and on. Why are they not part of the calculations? Also how come there is 120 $ mentioned for currency commission for Saxo mentioned in those tables? This is 0.5 percent of what? Where does this come from?

    Thank you for your time

    • Hi J.S.

      The 15% dividend witholding tax in inescapable, regardless of the brokerage, so it didn’t need to go on the brokerage comparison chart. If your dividend yield were 2%, and you paid a 15% tax on this, then the net dividend yield would be 1.7% (15% of 2 is 0.3)

      I did account for DBS Vicker’s dividend collection fee. You can see it calculated on the chart as the 0.02% annual charge on the total value of the account each year, assuming a dividend yield of 2%. But let me bring your attention to the lower fees now at TD Direct International http://andrewhallam.com/2016/01/brokerage-battle-saxo-capital-markets-versus-td-direct-international/

      Cheers,
      Andrew

      • JS. says:

        Hi Andrew,
        The 120$ for Saxo in the comparison table where does it come from? You mention in p. 179 that they charge 0.5 per cent if we convert currency but how did you add the 120$? Where does this number come from? So we need to pay taxes to the markets we invest in (Canada with 15 percent and US for over 60K investments) and possibly taxes in the country we live? I got confused on this. I’ll study your link thank you!!!!

        • JS

          That’s the cost of currency commissions, based on converting non-Canadian dollars into Canadian dollars, with the example of the sums invested annually in my example.

          But I shouldn’t have put $0 for the other brokerages, by comparison. They all skim a spread, beyond something called the “spot rate.”

          The listed fees for these brokerages do change often. The bottom line is this: each of these brokerages is extremely cheap. It’s best not to get too carried away about which you choose (although my current favorite is TD). Worrying about these fees is like selecting between three amazing cars, and measuring the amount of dust on each dashboard.

          Make your selection and stick with it. Most people, in offshore pensions, will pay 20 times what you will pay in investment fees.

          Cheers,
          Andrew

          • JS. says:

            Hi Andrew, you mentioned the pitfall with US market for stocks over 60k and taxes. You also mentioned stocks on dividends on the Canadian market. So I am curious do investors pay taxes both to countries they buy stocks from and to country of residence for income ?

          • JS,

            That all depends on your nationality and the country in which you reside. You may end up paying nothing for capital gains taxes: neither to Canada nor the United States, if your account is domiciled where capital gains taxes aren’t charged, and if your resident country doesn’t tax you on outside income or gains. Such would be the case in most of Asia and the Middle East.

            Cheers,
            Andrew

  15. Kim Cheah says:

    Andrew, I contacted AES Dubai as a Malaysian citizen, living in Manila. With a minimum of US$75K, here is their list of fees that they shared:
    £500 Annual Banking Fee
    If you are looking to invest, you will also pay;
    -0.35% Custody Fee
    -0.40% ETF Fund fee
    -1% Initial Fee (only once)
    -1% Ongoing fee
    1st year Total fees 2,85%
    2nd year Total fees and onwards 1.85%
    This seems higher than what you mentioned. Is this considered reasonable? I understand this would be a long term investment but we are still nervous after being burned by Royal380.
    Any input would be appreciated. Thanks
    Kim

  16. Joy Aquino says:

    Hi Kim,
    If you don’t need the integrated offshore private banking account then you can take away the banking fee and just have the investment platform.
    Likewise, although we use a 0.40% fee as average for ETFs – you could buy them for as low as 0.6% (Vanguard) if you wanted those type.
    Likewise, if you want pure DIY the advice fees for our portfolios (asset allocation, fund selection/suitability and re-balancing) wouldn’t apply.
    In effect you would just have a custody fee of .35% as long as you are entirely confident to do it yourself and be on your own. However, Saxo or TD will still be cheaper options on custody and trading for execution only as we are focused on bespoke advice.
    Advised or DIY – the costs will be poles apart from the 5%+ pa you paid for the contractual savings plan you previously owned.
    I hope this helps,
    Joy (AES Dubai)

  17. JS. says:

    Hi Andrew,
    1)in p. 191 you point out that”ETF investors trading on non-US stock exchanges don’t have to fill out such forms…. In most cases they’re still charged withholding taxes”. This seems to contradict example table 14.1 in p189. From p188 paragraph 2 I understood that as long as we avoid to buy from US stock market we are fine. Is there a contradiction between paragraph 2 p.188 and paragraph 5 p.191? I am trying to understand if I am missing the idea on what you are saying
    2) Why are you mentioning capital gains in the example calculation in p191? With index funds we pay capital gains only if we sell the index right? And the correct approach is to never sell it right? So why are you mentioning capital gains tax free zone etc in the analysis for tax in p. 191?
    Thank you for your time

    • Hi J.S.,

      Fortunately, there are no contradictions. 🙂

      On page 191, the reference is to dividend withholding taxes. That’s mentioned in the second sentence on page 191.

      On table 14.1, page 189, I’m referring to U.S. estate taxes upon death. You’ll see that explained on page 188, point #2.

      Capital gains are mentioned in the sample on page 191, but you’ll notice that capital gains “Tax” is not mentioned.

      When a stock (or ETF) grows in value, the growth comes from two sources:
      1. Dividends
      2. Capital gains

      If you are a non-American, with ETFs in a tax free jurisdiction, you will pay some withholding taxes on dividends, you will receive capital gains, but you won’t pay capital gains taxes, and you will pay no U.S. estate taxes upon death, if you purchase non-U.S. domiciled ETFs.

      Cheers,
      Andrew

  18. JS. says:

    Hi Andrew, I have a question on terminology.
    An index fund is essentially a tracker to a collection of stocks. So I assume when you give e.g. 5000$ for an index you own an X percent of it (which depends on the size) right? Now in p. 197-199 showing how to make a purchase you use the term units and shares interchangeably.
    So when you say “enter the number of shares to purchase before choosing the ETF symbol” do you mean that we buy only a portion of the shares tracked by the index?
    I am not sure what is the number of shares meaning in this context

    Thank yo for your time

    • JS,

      When you buy an index, you end up buying all of the holdings within it.

      An index fund or ETF is broken into units. These are called shares or units, depending on the brokerage that you use. Same Same.

      Cheers,
      Andrew

  19. AM says:

    Hi Andrew,

    First off, thank you so much for your books and website. I have read your books cover to cover (more than once!) and it has helped me tremendously on my path to early retirement.

    I am a Canadian expat living in the Cayman Islands. I’m comfortable managing my own portfolio with a discount brokerage and primarily purchase the Vanguard ETFs. I have my account with Questrade – any thoughts on these guys? I’ve also got an account with Interactive Brokers (IB) in the US. With the exception of getting caught in estate taxes, do you foresee any issues in using IB? Their trading fees of $1 seem extremely inviting.

    Thanks in advance!

    • Hi AM,

      Questrade is very good. IB is also good. But I think TD Direct International could be better than both. By using them, you could completely put yourself out of reach of Revenue Canada. There would be zero questions, ever, about your residency status. And your heirs could sleep soundly at night, not having potential headaches associated with U.S. estate taxes.

      Cheers,
      Andrew

  20. JS. says:

    Hi Andrew,
    I was wondering:
    1) how come you have so little focus on Europeans? Even here in your link “expat investing” you don’t mention Europe at all
    2) for a retail investor what are the top things to consult a tax advisor besides if foreign investment income is taxed and about off shoring?
    Thank you for your time.

    • J.S.

      I should tease you and say that I don’t like Europeans. But the section in my book that pertains to those who are from the EEC outstrips all other country sections, with the exception of the chapter for Americans. The combined British and European sections outstrip the section for Canadians (my people), Australians, South Americans, South Africans and New Zealanders.

      In the link you are pertaining to, I didn’t mention nationalities: just brokerages. Europeans could use all but one of the brokerages listed under the brokerages for “non-Americans.”

      As for speaking to an offshore tax specialist, what questions you ask will pertain to your personal circumstances: where you live, where you are from, what pensions you might have coming when you retire, what properties you may own (and where) what your level of income is. Go to the accountant with the full package. Your personal circumstances should direct the guidance.

      • JS says:

        Hi Andrew ,
        Yes you do list options for non-Americans in the offshore brokerage chapter but you don’t mention any index advisor for European expats in chapter 4 (except British). Is there any particular reason?

  21. tdb says:

    Hi Andrew,

    First of all thank you. I’ve read your first book and just started investing at the age of 23. I wish I would have read it earlier! I love the way you introduced me to this relatively easy way of investing, without any prior experience. I’ve recommended your first book to a ton of friends haha.

    I’ve actually got 2 questions in this case.

    First question: I just bought myself VOO and VEA, effectively tracking the S&P 500 and the developed world ex-US. I decided to leave upcoming countries out of the equation since they ( feel ) as a less safe bet, and seem to be performing mediocre lately. Could you tell me what the pro’s and con’s are in your experience when including/excluding these?

    Second question: I’m from Europe, so for my short-term bond tracker I’m looking for a short-term euro listed ETF. Could you tell me why exactly a short-term bond is better? And do you happen to have any suggestions as to which might be ‘good deals’ at this moment? I’d love to hear your opinion.

    I’m planning on buying your second book soon! If it’s got half of the value of your first book it’ll be a great deal. 😉

    Thanks in advance for your reply! Have a great day.

    Friendly regards tdb

  22. JS says:

    Hi Andrew,
    I visited a tax firm to ask about taxes and DYI and off shoring (to know about TD Glaxo etc).
    They scheduled me with someone who is a CFP.
    He said that they offer their own inv. program with 0.4 as their annual commission plus 150 euro per consult. Plus the asset managers commission and not sure what else. They offer indexes but seemed unhappy with that.
    I told him that I want to be DYI and want to understand taxation on this and I asked about offshore accounts.
    To make story short the only thing he told me is that investing with offshore brokerage us legal but
    1) taxation on that is complicated and he did not know otoh
    2) he/they offer advice only if one becomes their customer because he claims someone might misuse their advice.
    So except that it is legal to invest in the online platforms I did not learn anything new.
    Question:
    Should I start investing in the offshore brokerages and at some point find another tax consultant for my tax statement?
    I mean either the offshore is not taxed or it is taxed. If it is taxed is there a reason to choose something other than offshore?
    Country Netherlands
    Thank you for your time
    JS

    • JS says:

      I mean isn’t the best choice the offshore brokerage anyway or taxation could change that?

      • JS says:

        I mean the options to invest are
        1) advisors like those you propose
        2) DIY with offshore brokerage account
        3) DYI with non offshore brokerage account.
        Isn’t for DYI #2 the best option? Or one could find better deal with #3?

  23. Chompunoot says:

    Hi Andrew,
    My husband is an English. After reading your book and we opened an account with Saxo Singapore . We are interesting in your suggestion on Chapter 17 for British Expat investment. My question is if we are just about to start trading soon , the funds and bonds that you recommenced on the Chapter 17 are still be good options for us to start with ?
    Thank you for your time.

  24. J.S. says:

    Hi Andrew,
    I was wondering why you don’t mention real estate funds in the portfolios suggested in your book? It seems to me that they add diversification.

  25. Larry Friesen says:

    Hi Andrew;

    A little chintzy on the Canadian Index Fund advisor recommendations aren’t you? Considering you are Canadian I would have expected at least a few more. Thanks for just the one anyway (Wealthbar) but not sure if I’m feeling the love when I go to their website.

    • Larry,

      It’s Canadian regulatory law that’s chintzy, not me. I cannot find another Canadian firm that will deal with Canadian expats. I have called dozens. Now take back the chintzy comment 🙂

      You could also use AES International. But contact the Dubai office only.

      If you really want to save money, you could also invest on your own, as I outlined in my expat book, using a brokerage like TD Direct International or Saxo Capital Markets. http://www.aesinternational.com/

      Cheers,
      Andrew

  26. J.S. says:

    Hi Andrew,
    I have 2 questions
    1) in your book analyzing on TD Direct you mention 28€ per trade and 0.2% annual fee. In their site I see 14.95€ – 49.95€ commission rates depending on the market. This is clear. But I can’t find the 0.2 per cent account fee or to put it differently besides Maintainance account fees of 45€ they don’t mention something more. What am I misunderstanding here?
    2) DBS Vickers seems to trade in SGD so I assume that it is best to pick a brokerage that matches our currency right? I mean if DBS Vickers is cheaper won’t I need to convert my money to SGD to open an account with them? That could lead to a “loss” right? But you don’t mention this in the section about DBS. Am I confused on this too?

    Thank you for your time
    J.S.

    • J.S.

      DBS Vickers allows you to trade in Canadian dollars, if you buy off the Canadian exchange.

      TD’s brokerage costs are now lower than they were 18 months ago, when my book was published. You can read about that here: http://andrewhallam.com/2016/01/brokerage-battle-saxo-capital-markets-versus-td-direct-international/

      Cheers,
      Andrew

      • J.S. says:

        What about when the money is in euro? Is such currency differences things to watch out when choosing brokerages ?

        • No J.S., as mentioned in my book, the currency the funds are listed in doesn’t mean you are necessarily investing in that given currency. This article might help: http://andrewhallam.com/2016/05/expatriate-investors-does-it-matter-which-currency-your-etf-is-listed-in/

          • J.S. says:

            Hi Andrew, my concern is more about the currency of the account itself. My money is in euros so I assume that the account I should open to transfer my cash and buy funds should be in euro also right? Then if I buy US stocks I understand that this will be in dollars eventually but I wanted to understand if the account’s currency in DBS for instance is in SGD or not. Do I make sense?
            Thank you!

          • J.S.
            You can’t buy Euro denominated ETFs via DBS Vickers. If you want Euro denominated ETFs, you will have to use Saxo or T.D. And you will have to make sure the ETF is listed in Euros, not pounds or USD.

            Andrew

          • J.S. says:

            Hi Andrew,
            When we open a brokerage account with TD, DBS etc we create an account and transfer cash from our personal account to the newly created account right? My personal account is in euro. So when I transfer my money to eg DBS what currency should that account be? If I want to buy an ETF in dollars it is fine to convert my euros to dollars but this means that my brokerage account that holds my cash is also in euro right? I mean if I transfer euro from my personal account to be converted in SGD in my brokerage account (there is a cash deposit before purchase and we also keeps the dividends in the account in cash right?) to be converted in USD to buy the ETF shares that is 3 conversions right? Am I confusing you on this?

          • J.S. says:

            Sorry Andrew I think I am confused on this. When the brokerages say “options to open account in multiple currencies” is that essentially what I am asking? My understanding from the descriptions about buying ETFs from brokerages is that there might bean extra conversion if we don’t open the account in the same currency as we have our personal account.

  27. J.S. says:

    Hi Andrew,
    In your post about AES Stuart Ritchie, you note in one of the comments:
    “Saxo charges less for its DIY platform, but in a pinch, nobody at Saxo would answer questions about diversification”
    What would these questions be? I was under the impression that the portfolios recommended in your books are already diversified and we should keep them forever.
    Could you please elaborate on what you mean? I am trying to evaluate if I should go for a DYI approach even though I am a newbie

    Thank you for your help!

    • J.S.

      The portfolios in my book would need to be rebalanced once a year, or you would need to maintain a constant allocation with fresh purchases. If you have the fortitude to do that, despite what the markets or the media throws at you, then the DIY approach would be the cheapest and most profitable way for you to invest.

      Cheers,
      Andrew

  28. Chapalaman says:

    Hola Andrew;

    You gave a presentation to expats in Ajijic, Mexico some time ago. Are you still big on Vanguard? You also mentioned some names of financial planners from Canada who do a good job of managing portfolios. Are these still valid?

    Gracias.

    • Hi Larry,

      I hope you’re doing well!

      Yes, Vanguard is still an excellent option. I believe that it always will be. But Vanguard is only for Americans, unless you are buying Vanguard’s Canadian listed ETFs. The financial planners I mentioned do an excellent job managing portfolios.

      Cheers,
      Andrew

      • ron says:

        That’s a bit narrow. There are plenty of Vanguard ETF’s listed in Europe in USD, EUR, GBP, CHF that are domiciled in Europe as well. Plenty of choice outside the US and Canada. VWRD on the LSE is eg similar to VT in the US.

  29. J.S. says:

    Hi Andrew,
    Am I understanding TD correctly? Is it just 50 euros per year for management? http://int.tddirectinvesting.com/pricing/account-fees
    I assume the 500 € per year for corporate account are for special accounts?

    Thank you for your time

  30. J.S. says:

    Hi Andrew,
    I have a question about diversification. The idea of it is not put all eggs in one basket right?
    I was wondering is a form of diversification for someone to have his money/accounts in a completely different area than his location? E.g a European to invest via Asian brokerages, an American via European brokerages and so on?
    May sound weird question but I had in mind whether bank stability per continent adds some extra factor of safety (I noticed TD has some disclaimers about money pools and protection and keeping money out of Luxemburg occassionally)
    Thank you for your help

  31. Rehan says:

    Hi Andrew. Im an 38yrs, Indian expat living in Dubai. I checked AES, but they accept clients with minimum investment of 75000USD. I dont belong to the high income category. I already made a blunder investing with Zurich and FPL and im trying to exit. I wish I read your book and saw this site earlier. But not much advice for Indian expats who are a huge number in Middle-east. I checked with TDdirect but they wont offer an account for me and directed me to Saxobank(who needs min 10000USD). I dont know if we are permitted to invest in index and bond funds from US/UK. I also checked the investment firm- Finerd. Pls advcie. Thanks

    • PM99 says:

      Hi Rehan,

      I am an Indian living in the UAE and have faced similar problems to what you have described. What was the reason given by TD Direct to reject your application? As a UAE resident you have an option to open an account with Swissquote (https://www.swissquote.ae). You don’t beed a minimum to begin with them. Seeing your message I checked out Finerd and it seems rather interesting, they are probably the first rob-advisor firm in UAE, firms like them are a big hit in US. I have written to Finerd to find out more info. The one thing which is an issue is that Finerd uses Interactive Brokers as custodians and using IB you would be liable to US estate taxes (as mentioned by Andrew in his various posts), but this issue is not applicable to someone like me (at least as of now as my investments would be well under $50K). Anyway lets keep in touch and hopefully we will learn few new things from each other 🙂

      • rehan says:

        I didn’t know they were partners. This was their comment:With TD Direct Investing in Luxembourg we are currently unable to offer you an account, however if your residency status were to change, please do not hesitate to contact us on eligibility.However, our partner Saxo bank can open an account for you.
        I hold Indian passport with uae employment status. As for Finerd, they have not yet opened up in uae. I’m checking Swissquote as u mentioned. thanks

  32. Dickson says:

    Hi Andrew, I am an expat living in Qatar and I would like to open an offshore account and I came across with NedBank focus account in isla of man, however i understand AES international offers a brokerage service with nedbank , my question is about efficiency on using AES as oppose to go directly to Netbank. I guess AES will be more active in looking at the portfolio but at the same time I will be adding about 2% annual expenses over my portfolio, would be best to use the dealing service of NedBank with a balanced portfolio based on ETF plus an structure saving? thanks

    • Dickson,

      You could simply build a portfolio of your own ETFs via TD Direct International. It would cost you about 0.15% per year. If you have the discipline to just buy the same 3 ETFs your whole life, and rebalance once a year, you can invest at the lowest possible cost.

      Cheers,
      Andrew

  33. dickson says:

    Thank you Andrew… I think you are right, provided the strategy for rebalancing and top up is consistent and I also found that AES investing strategy is mainly based on ETS anyway… thanks for the blog , the book and all the advice !!! very sound and useful (two years back I was lucky to read your book and avoid Zurich Vista 🙂

    Cheers
    Dickson

  34. Joe Hassett says:

    Andrew, Been in Singapore 7 years and I am already in both Friends Provident and Zurich International Vista & a small Generali holding, have been for around 4 years or so. To be honest, I never really though much about the high fees, long lock-in periods, release charges etc., until recently when a Premier New Earth investment within my FP holding is looking to have gone belly up and I am about to lose SGD100k+! It has caused me to reflect on what I have and been advised on by my advisor. Should I now be thinking about biting the bullet, taking a big hit now to release the funds and trying to re-focus into doing something with my own EFTs as you appear to be suggesting as the way to go above? Also looks like I might need to read your book too!! Cheers J H

  35. Patrick says:

    Hi Andrew

    What would be the circumstances whereby I would need an advisor? Having followed your book am I not setup with the DIY route of doing the couch potato ETF disciplined approach to investing? Interested to see when/why I would need an advisor.

    Cheers

    Patrick

  36. Patrick says:

    Great. I’m going to use my lack of knowledge as a reason to put faith in the simple and easy couch potato strategy as I’m far too fearful to try and be smart about this.

    In terms of my portfolio which I’m looking to execute this week, as a 35 year old Brit I’m looking at:

    30% iShares UK Gilts
    35% Vanguard UK FTSE 100
    35% Vanguard FTSE All-World

    I’ve set my account to trade in GBP to keep things simple. Also, I read that you suggest investing a minimum of 3k SGD into an ETF at a time. If I have 3kSGD a quarter to invest I guess I just go one by one as I build my portfolio rather than try and split the starting investment?

    How am I doing?

    Thanks again Andrew, your book and blog have had a positive life changing affect.

    Cheers

    Patrick

  37. Patrick says:

    Made my first trade today woo hoo. FTSE 100 and world on the rise more than the UK bonds so decided to start with 3k into bonds today. Wanted to mark it as my first trade so there’s a post to remind me years from now and to come back to in order to stay on course. Thanks again Andrew

  38. Patrick says:

    ..though I am a bit confused as I was under the impression that I paid 20GBP per trade through it’s saying my total cost is 40GBP as it looks like there is a 20GBP charge for ‘open’ and a 20GBP charge for ‘close’ – I followed your instructions by making it a market trade and only traded once.

    • Patrick says:

      Sorry, sorry, being dumb. They’ve obviously reserved the 2nd 20GBP for when I want to eventually close and sell. I understand now. Learning everyday 🙂

  39. dafydd says:

    Hi Andrew,

    I’m a teacher living in Bangkok and trying to begin the investment journey. I’ve managed to set up an account with TD International as they seemed to be one of very few options open to UK expats. But I’m having some trouble.

    They seem to have very few options as far as the UK market goes, or true index funds. Im looking for 30% FTSE 100, 20% S&P, 30% all world market and 20% in secure bonds. Can you give me any recommendations?

    Also, what are the legalities of opening an account with The TD UK branch and telling them I live in the UK? Do you know any of the repercussions or problems? This would be ideal as I could then keep my money ISA protected for if I ever move back to the UK. (maybe an article about benefits or possibilities of UK expats investing their ISA’s or how to protect them could be a good idea)

    Any help would be greatly appreciated

    Many Thanks

    • Dafydd,

      As a UK resident (even a pretend one) you will have to pay UK capital gains taxes on your profits. As a resident of Thailand, you would not. In my book, I’ve listed a variety of ETFs (exchange traded index funds) that are all available through TD Direct International. I also show how to buy them, using screen shots in the book. This should help. http://bit.ly/globalexpat

      Cheers,
      Andrew

      • dafydd says:

        Hi Andrew,

        I read both of the books and have used a lot from there. As far as the capital gains tax goes I was going to keep it in an ISA wrapper and transfer it from my existing bank (I know I cant make and extra monetary additions while im not a resident) to protect it and future earnings.

        What do you think?

        Thanks again

        Dafydd

  40. Shingi says:

    Hi Andrew
    I don’t fall into the expat group but i desperately ned guidance on how to start investing even at very small levels. I am a student in Canada and i wish to find investment solutions open to me an African with at least a manageable initial investment $2000-$5000. Any leads would be appreciated

  41. Cary Hart says:

    Andrew, Any thoughts on any of these three companies? Raymond James, Integrated Financial Planning Services (IFPS), and Verde Montagne. I would appreciate any knowledge that you may have.
    Thank you.
    Cary

    • Cary, I believe that Raymond James is the best of the three. But I don’t know your nationality, so it’s tough to speak about specifics. That being said, there are far cheaper ways to invest than Raymond James. Borrow a copy of my book for expats. I explain plenty in that. http://bit.ly/globalexpat

      • Cary Hart says:

        Thank you Andrew. I am American and those three were our only choice. I know that it is preferred to not use any of them but our school does not allow for that.

        • Cary, Raymond James will let you build a portfolio of index funds. They’ll charge you 1% to do it. They promised me they could do it for U.S. teachers. I quoted them in my expat book. Please hold them to that promise and keep me posted.

          Thanks!

    • toony says:

      Cary,
      IFPS and Verde Montagne are just insurance brokers, masquerading as investment advisors – RJ are not much better! Quick check indicate their products are laced to insurance wrapper – you have been warned.

      You can spend a few $ getting Andrew’s book (and learning an important life skill) or risk losing $10-100k+ getting scammed by these insurance brokers – your choice!

  42. Darren says:

    Hi Andrew, thank you for writing your books. I enjoyed both of them and learned a lot.

    I am a Canadian teaching in Jakarta, my wife is American and teaches here with me. I am extricating myself from bad judgement/advice from a (former) financial advisor to invest with FPI. I am looking to begin investing as you have suggested in your books as DIY into index funds and bonds. My question is this: What can a company like the one you suggest, Jason Heath’s Objective Financial Planners, provide me that a close reading of your books cannot? They would like to charge me $4500CDN to advise me on investment and retirement plans. I have read and understood your books, do you think their expertise is worth the $4500? My alternatives are to go it alone without their advise or use Wealthbar.

    Thank you,

    Darren

  43. Jennilea Hortop says:

    Hi Andrew,

    I have been doing a lot reading since your book about Interactive Brokers and the negative aspect of the estate tax and trying to figure out what this means.

    I have talked with the HK based brokerage who said they do not give out the clients names to the IRS. I am still not clear for what it means for Canadians to invest in US based ETF’s and get taxed on them with the estate tax.

    What if you continue to invest any dividends payed? Does that exempt a person from the estate tax?

    For some Canadians who are living in Indonesia and are unable to invest using TD direct you have said it is ok to use IB as they do not have another option.

    What if I used IB and use what you suggested in terms of ETF purchases for expat Canadians who plan to retire in Canada with exposure to a bit of the Global Market ETF’s The fees with IB are much better than TD. But the tax situation makes me nervous!
    Thanks!

  44. M.V. says:

    Hi Andrew, I’m a Canadian expat currently living in Doha. We are just starting to look at our investment options. I am very grateful for this website and for the conversation. It seems like for us, WealthBar is the way to go. But the $25K minimum is quite steep. Should we begin elsewhere? If so, what would you suggest?

    • Hi MV,

      I have good news for you. WealthBar does not have a $25,000 minimum. They have a $5000 minimum. The $25,000 that you see on the website is just a sample to show how much such an investor would pay in fees, given a portfolio of that size. https://www.wealthbar.com/pricing
      What school are you at in Doha? I will be there from February 12th until Tuesday, February 21st. If you would like to book a free talk (so I could talk to your teachers) please book a time and date with my wife at millionaireteacherspeaksATgmail.com

      Cheers,
      Andrew

  45. Tiffanie says:

    Hi,
    Do any of your books address those with dual or triple citizenship (which includes the US)?
    Many thanks!

    • Hi Tiffanie,

      From a tax standpoint, if you have U.S. citizenship, you’re responsible for U.S. taxes. If you’re an expat American, you could open a portfolio with Interactive Brokers and follow the portfolio allocations for American citizens. Likewise, if you are more global, you could use one of the global portfolio models in my book, the Global Expatriate’s Guide To Investing. In this case, you could also build the portfolio via Interactive Brokers. If you actually live in the United States, you could directly use Vanguard. http://bit.ly/globalexpat

      Cheers,
      Andrew

  46. Jon Iliffe says:

    Hi Andrew,

    I am curious about the tax on my dividends for Vanguard ETF’s bought from the TSX. I am a Canadian non-resident, living in Vietnam with a Saxo account in Singapore. I read in your books that dividends are taxed at the source. Is there any other tax responsibility for me after that? Who does the “tax at the source” go to?

    Cheers,

  47. Jon Iliffe says:

    Thanks Andrew,

    I just read in the 2nd Edition of Millionaire teacher that you recommend a
    VXC, VCN, VSB portfolio for Canadians. Do you suggest this over VDU, VUN, VSB? I do not plan to retire in Canada. Does that effect whether I should choose one of these portfolios over the other.

    Thanks again,
    Jon

    • Hi Jon,

      VDU is a developed world international market ETF. As such, it doesn’t have any emerging market exposure. Emerging markets make up about 8% of global capitalisation. If you want VDU, then you should also add VEE, which is a separate emerging market index. But if you want to keep things simpler, go with VXC. It contains emerging markets and developed markets.

      Cheers,
      Andrew

  48. Edwina Rigby says:

    Hi Andrew,

    I read your book (on great advice from SAS teacher friends of yours) and have followed your guidance for the past year. I understood the importance to keep fees at a minimum. Do you have an opinion on DBS Vickers foreign shares custody fee charged quarterly? Is this a deal breaker?

    Appreciate your input.

    Thanks,
    Eddie

  49. Christina Dodge says:

    Hello Andrew,

    Great article! Can’t help but notice that you are missing Reilly Financial Advisors and our International team. We have offices around the US, in Prague, CZ, and Kohbar, SA. Our team of experts have over 40 years experience helping expats navigate a path to successful financial futures. expatadvisors.com

    • Hi Christina,

      I only profile firms that build (solely!) portfolios of low cost index funds. If a firm has ever stuffed an actively managed fund in an investors’ portfolio, I don’t recommend them.

      Cheers,
      Andrew

      • Christina Dodge says:

        Hello Andrew,
        We do not use actively managed funds. expatadvisors.com uses individual securities to build custom portfolios for clients. We believe in your principles of Fiduciary standard and not charging commissions. We are a full wealth management firm providing more than simple investment management to our clients. We help our expat clients make sound financial decisions and navigate a path to their future financial life, whether that be repatriating to their home country or selecting a new home country for retirement. We agree with your perspectives; keep up the good work!

    • Christopher Lean says:

      Christina,

      I note you are in Prague. I cannot find your firm on the Czech National Bank Register- the local regulator. What is the trading name of the local sro ( Czech ltd company ) that I should be looking for on the register?

      Regards,

      Christopher Lean

      • Christina Dodge says:

        Christopher,

        We have consulted with the necessary parties, particularly Stark & Stark and PRK Partners s.r.o., Attorneys at Law. Through our consultations, we are conforming to all regulatory requirements.

        Regards,
        RFA

  50. Sarah says:

    Hi Andrew

    I have just moved to Hong Kong and must subscribe to a Mandatory Provident Fund by law. My company has a fixed one “HSBC Mandatory Provident Fund – Super Trust Plus” which allows me to put together a mix of 13 funds at whatever percentage weight I choose. The only index fund in the mix is the Hang Seng Index Tracking fund. The information from them is that this fund has equities only as follows:

    HSBC Holdings 11.57%
    Tencent Holdings 9.81%
    China Mobile 7.51%
    AIA Group 7.33%
    China Construction Bank 6.42%
    Industrial and Commercial Bank of China 4.75%
    Bank of China 4.06%
    CK Hutchison Holdings 3.75%
    Hong Kong Exchanges & Clearing 2.81%
    Ping An Insurance 2.80%

    Is this the sort of thing you mean when you advise in your book to invest in index funds.
    Thank you very much for your advice
    Sarah

  51. Chris says:

    Hi Sarah – I am also living in HK. The Tracker fund to which you refer attempts to follow the Hang Seng Index – which comprises the larger and more liquid “blue chip type” stocks listed in Hong Kong. Unfortunately, investing in this via the MPF offering is much more expensive than buying an equivalent ETF. Overall the Hong Kong MPF scheme is very over-priced and the expenses are a serious drag on returns,

    As you note, everyone must subscribe to an MPF scheme, but I would advise putting only the minimum monthly amount required by law. Invest any other funds elsewhere along the lines suggested by Andrew. (What you choose will depend on your objectives, nationality, etc.). As you still have to put some funds into the MPF, one option is to treat this as a part of your overall bond holdings. (Assuming you hold some percentage of assets in bonds). The HSBC Global Bond fund under the MPF scheme, for example, is one of the lower cost choices – although still much more expensive than an equivalent ETF. I use this.

    Other funds I invest directly in index tracking ETFs outside of the MPF using the philosophy explained by Andrew in his excellent books.

    Regards,

    Chris.

  52. Sarah says:

    Thank you so much Chris. This is very helpful. I shall keep investment to a minimum with the MPF fund.
    Cheers Sarah

  53. Charles says:

    I have recently been using the services of Mark Zoril. I have found him to be knowledgeable, accessible and very reliable. I would highly recommend him.

  54. John says:

    I wish I had come across you a few years ago before being conned by an under qualified salesman in Abu Dhabi! Fortunately your recommendations have enabled me to cut my losses and I’m now in a well diversified portfolio of index funds courtesy of the excellent AES.

    My question is, once you are in a low cost well diversified portfolio of index funds, is there really any good reason to continue paying fees for on-going advice? In AES’s case they are 1.25% p.a. Shouldn’t my portfolio now only need reviewing infrequently and if so wouldn’t it be better to pay for one-off occasional advice?

  55. Adam says:

    Hey everyone, In the process of approving my application, TD Direct International based in Luxembourg has been acquired by J.C. Flowers & Co. and re-branded as Internaxx (www.internaxx.com). Everything as far as products , platforms and pricing on the website seems to be the same as what I knew I was getting into with TD – but does this raise any red flags for anyone?

  56. Anette Bartha says:

    It seems like a lot has changed since 2015 because now it’s impossible to open an international brokerage account if you are based in the US regardless of nationality. I think I tried all of them with without success. As for roboinvestors, Moneyfarm was the only one that accepted my application.
    So maybe I just have to open a US based Schwab or Fidelity account and buy US based ETF’s instead?. My question is if i invested $100 a month and buy let’s say VGLT – currently trading at $77 a share what happens to my change? (ETF’s cannot be bought or sold in fractions)
    Also if i created one of the couch potato portfolios overtime these shares could reach as much as $100 each (in comparison to UK open end funds) then monthly contributions will have to be increased. And finally how do i allocate $100 when buying fractional share is not an option?

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