The Global Expatriate’s Guide To Investing – From Millionaire Teacher to Millionaire Expat

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READ THE TABLE OF CONTENTS

 

Foreword

Scott Burns xiii

Acknowledgments xvii

Introduction xix

Chapter 1: Setting Your Bull’s-Eye 1

What’s This Ailment Expatitis? 3

Cheating Conventional Retirement Rules 3

Cooking Up the Road Less Traveled 5

The Earthquake and the Epiphany 6

Jujitsu Junkie Taps Out for Home 8

Now It’s Your Turn 9

Notes 10

Chapter 2: Building Your Pension 13

How to Never Run Out of Money 14

The Man with Nothing But a Backpack 16

The Couple with Swedish-American Dreams 18

A Front-End-Loaded Tale of Success 22

Notes 24

Chapter 3: The Truth about Stocks and Bonds 25

Halloween Grab Bag Treats Investors 26

Why Average Returns Aren’t Normal 29

Stocks Pound Inflation 29

What Has the Stock Market Done for You Lately? 31

Undressing Stocks with 50 Shades of Gray 32

The Stock Market Stars as the Great Humiliator 35

Fast-Growing Economies Can Produce Weak Returns 37

Bonds Are Protective Nets for Jumpers 38

Can You Lose Money With Bonds? 41

Notes 43

Chapter 4: Don’t Start a Fight with an Escalator 45

Yes, the Financial District Loves You! 46

Global Investors Getting Fleeced 47

Notes 50

Chapter 5: Where Are the Customers’ Yachts? 51

Global Investors Bleed by the Same Sword 52

American Expatriates Run Naked 53

Why Brokers Want to Muzzle Warren Buff ett 54

Financial Advisors Touting “The World Is Flat!” 56

Hedge Fund Money Spanked for Its Con 58

Why Most Investors Underperform Their Funds 62

Notes 65

Chapter 6: Don’t Climb into Bed with a Silver-Tongued Player 69

Featuring the Rip-Offers 71

The Ten Habits of Successful Financial Advisors . . . Really? 72

When Your Advisor Is a Sales Commando 73

Welcoming Sharks into the Seal Pool 74

Misled Investors Pay the Price 75

A Canadian Investor Gets Bled 75

Would You Like a Band-Aid for That Bleeding Gash? 77

Masters of the Insured Death Benefi t Illusion 77

Free Fund Switching Isn’t a Perk 78

Making Millions off the General Public 79

Fooling the Masses with Numbers 79

Regulators Making an Effort 80

Can Squeaky Wheels Gain Redemption? 83

If Investors Can’t Reclaim Their Losses 84

When High Fees Meet Gunslingers 86

A Son’s Inheritance Gets Plundered 86

British Teacher Learns a Costly Lesson 90

Playing Soccer Like Wasps around Honey 90

Most Investors Are Crazy 92

Notes 93

Chapter 7: Self-Appointed Gurus and Neanderthal Brains 95

Why Most Investors Should Hope for Falling Markets 96

It’s Not Timing the Market That Matters; It’s Time in the Market 97

High Unemployment and High Stock Returns 98

What Can You Miss by Guessing Wrong? 100

When Investors and Advisors Sabotage Their Rides 102

Popular Stocks Underperform 104

How About the Next Big Thing? 105

When Genius Fails 107

Notes 107

Chapter 8: An Employer’s Greatest Challenge 111

Fees—How Much Is Too Much? 113

So What’s the Solution for Global Employers? 115

Notes 118

Chapter 9: Couch Potato Investing 119

Don’t Bonds Tie You Down? 120

Is It More of a Fling Than a Real Relationship? 120

Potatoes Growing Globally 122

Bonds Relative to Age and Risk 124

What If You’re Falling Behind? 125

Profi ting from Panic—Stock Market Crash 2008-2009 125

Owning the World 126

Where Do You Plan to Retire? 127

Are You Retiring in an Emerging Market Country? 129

Does This Sound Too Good to Be True? 130

Chapter 10: The Permanent Portfolio: Growth without Risk 131

Gold in Isolation Is a Total Loser 132

A Disco-Era Brainchild from a

Twentieth-Century Socrates 132

This Great Portfolio Will Never Be Popular (But It Should Be!) 133

Why Does It Work? 137

What Has It Done for Me Lately? 138

Notes 139

Chapter 11: Fundamental Indexing:

Can We Build a Better Index Portfolio? 141

Like Top Basketball Players Getting the Most Court Time 142

Index Funds That Appear to Beat the Market 144

Investment Legend Likens Them to Witchcraft 144

Global Fundamental Indexes Might Shelter Us from Bubbles 146

Emerging Markets Show the Greatest Diff erence 146

Aren’t These Just Actively Managed Products? 147

Notes 148

Chapter 12: Capable Investment Advisors with a Conscience 149

Do You Have a Ninja’s Discipline? 151

Qualities of a Great Financial Advisor 151

Investment Professionals worth Considering 153

Notes 170

Chapter 13: Choosing Your Off shore Brokerage—For Non ]Americans 173

DBS Vickers Securities Opens the Door to Everyone 174

Why You Should Avoid E*Trade Financial 176

TD Direct Investing International 176

Saxo Capital Markets—A Jewel with Distractions 177

Comparing Fees with International Brokerages 179

Is Interactive Brokers the Dark Horse Winner? 184

Notes 184

Chapter 14: The 16 Questions Do-It-Yourself Investors Ask 187

What’s the Diff erence between an Exchange-Traded Index Fund (ETF) and an Index Fund? 187

Do Non-Americans Have to Pay U.S. Estate Taxes upon Death If They Own U.S. Index Shares? 188

What’s a Sector-Specific ETF? 188

Should I Buy an Index That’s Currency Hedged? 189

What’s the Scoop on Withholding Taxes? (For Non-Americans) 191

Will You Have to Pay Currency Conversions? 192

Should I Be Concerned about Currency Risks? 193

Do the Unit Prices of ETFs Show Which Are Expensive or Cheap? 194

If I Have a Lump Sum, Should I Invest It All at Once? 194

I’m in Some Expensive Products, but They’re Currently Down in Value. Should I Sell Now or Wait? 195

How Do I Open a Brokerage Account and Make Purchases? (For Non-Americans) 195

What If I Find a Higher-Performing Bond Index? 200

What If I Find a Cheaper ETF? 201

Should I Be Most Concerned about Commissions, Annual Account Fees, Fund Costs or Exchange Rate Fees? 201

How Little Can I Invest Each Month? 201

Stock Markets Are High. Should I Really Start Investing? 202

Let’s Go! 203

Notes 203

Chapter 15: Investing for American Expats* 205

Do You Currently Invest with Vanguard? 206

Couch Potato Investing with Vanguard 207

Couch Potato Investing with a Vanguard Stick Shift 209

When Investors Binge on Speculation 210

Charles Schwab Off ers a Great Deal 212

Doing the Couch Potato with Schwab 212

Permanent Portfolio Investing with Schwab 214

Fundamental Indexing Magic in the Works 214

Don’t Contribute Illegally to Your IRA 215

What Exactly Is an IRA? 216

Roth IRAs Are Diff erent 216

Notes 217

Chapter 16: Investing for Canadian Expats 219

Canadian Funds Earn an “F” for Costs 220

Brokerage Options for Expatriate Canadians 221

Brokerages for Canadians in Capital-Gains-Free Jurisdictions 222

Building a Canadian Couch Potato Portfolio 223

ETF Canadian Price War 227

The Permanent Portfolio, Canadian Style 227

Fundamental Indexing Portfolios 229

What About RRSPs and TFSAs? 230

Swap-Based ETFs, the Ultimate Legal Tax Dodge 231

Notes 232

Chapter 17: Investing for British Expats 235

Expensive Firms Performing Like a Virgin 236

Couch Potato Investing for British Expatriates 237

British Investors and the Permanent Portfolio 240

Fundamental Indexing for the British 241

Notes 243

Chapter 18: Investing for Australian Expats 245

Fancy an Australian Couch Potato? 247

How About an Australian Permanent Portfolio? 248

Fundamental Indexing for Australians 249

Notes 251

Chapter 19: Investing for New Zealand Expats 253

Kiwis Chilling Out With The Couch Potato 254

Permanent Portfolio for Kiwis 255

Fundamental Indexing for New Zealanders 255

Notes 257

Chapter 20: Investing for South African and South American Expats 259

South African Investors 259

South Africans Fry Up the Couch Potato 260

South African Writer Likes the Permanent Portfolio 261

South Africans Preferring Fundamental Platforms 263

South American Investors 263

Brazilian Investing Models 264

Notes 267

Chapter 21: Investing for European Expats 269

Country-Specifi c European ETFs 269

European Indexes That Investors Will Like 271

Why Not Choose the Simpler Option? 274

Calling Italians and the Swiss 275

The European’s Permanent Portfolio 276

Fundamental Indexing for Europeans 277

So What’s It Going to Be—Couch Potato, Permanent, or Fundamentally Indexed? 279

Notes 279

Chapter 22: Investing for Asian Expats 281

An Indian National Divulges Her Plan 282

Asians Embracing the Couch Potato 284

Asians Choosing the Permanent Portfolio 287

Fundamental Portfolio for Asians 288

Notes 289

Conclusion 291

About the Author 293

Index 295







best-hotel-car-bnr

andrew hallam

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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733 Responses

  1. david says:

    Hi Andrew,

    Is your book available for purchase locally in Singapore?

    Thanks,
    David

  2. Jordan Benedict says:

    Hi Andrew,

    Firstly, thank you so much for the clarity and message in your two books. Your first book set me up to personal finance in an enjoyable and accessible way. Now with your second book, I appreciate the expat specific primers, and the specifics to planning in the beginning. Another great read!

    Quick question: As an American Expat, in Millionaire Teacher, you suggested to use Vanguard Total Bond Market Index for the bond portion, but in The Global Expatriates Guide…, you suggest Vanguards Short Term Treasure Index (VFISX).

    What’s the reason for the change? I would think that Total Bond Index would be your preferred since it can be on Admiral Shares (with a 0.08 ER).

    Again, I appreciate the body of work and evidence you’ve created – and I’ve shared it with dozens of others. Cheers!

    • Hi Jordan,

      In Millionaire Teacher, I said that short term government bond indexes were preferable. But when giving a sample bond index, I gave a broad index by mistake. Whether you choose a broad index or a short won’t likely make a great deal of difference. But for reasons suggested in Millionaire Teacher, and in the Expat’s Guide, I personally prefer short.

      Cheers,
      Andrew

      • Jordan Benedict says:

        Thanks Andrew,

        We currently have just hit our 100k mark, so not so much invested in the Total Bond index right now (although we are on Admiral Shares with expenses just 0.08). To fight inflation, would you recommend selling and moving to the Short-Term treasury index? Or just starting to invest that way? Or do you not see enough difference?

  3. Jaron says:

    Hi Andrew, love your both book, I am currently residing in Singapore and i know you recommend DBS, but i found CIMB https://www.itradecimb.com.sg/app/home.z, which offer similar rates as DBS, but do you know the different between it?

  4. Patrick Ryan says:

    Hi Andrew:
    We are just recent snowbirds in Lake Chapala area, and I read your article in the El Ojo Del Largo, and as a recent retiree I am interested in avoiding taxes as much as possible in Canada. Regarding retirement income I am following Darryl Diamond’s book on retirement income, which suggest that you do not wait until you are 71 years take your money out of your RRSP, so I taking the maximum out without getting caught by the OAS claw back. The problem is my non -registered investments, which I have in Corporate Class shares, which is the same as Mutual Funds, and yes I am very aware that Mutual Funds are the greatest rip off, but I am not aware of any other method that I can use to defer income until I have depleted my RRSP, and not pay taxes. I will be ordering your books to see if I can learn something on another vehicle to invest in to defer paying taxes at this time. Looking forward to hearing from you.

    Regards
    Patrick

    • Hi Patrick,

      Are you interested in deferring income, in terms of interest and dividends? If that’s the case, you may want to look into Horizon’s swap based ETFs. They don’t generate taxable dividends or interest. The dividends or interest, instead, goes into the underlying asset of the ETF. So you would only have to pay capital gains when you sell it, no other taxes. I explained this, in much greater detail, in my new book: http://bit.ly/globalexpat

      Welcome to Lake Chapala!

      Andrew

  5. Patrick V. says:

    Hi Andrew, I picked up your first book three years ago after reading a recommendation article written by Scott Burns and immediately instituted the program you outlined Kris Olson on page 102. After reading the PDF you emailed my on your new book and the suggested allocations I am a bit confused by the message. Is your suggestion to migrate from the plan outlined in Millionaire to the “permanent portfolio”? If so, can you tell me how you went about it with your portfolio?

  6. Hi Patrick,

    My plan certainly wasn’t to lure you away from a cap-weighted index platform, as mentioned in Millionaire Teacher. That’s still the same platform I use for my own money. The new book just mentioned to other, equally good strategies, plus the original. No need to move your money.

    Cheers,
    Andrew

    • Robbyn Wysocki says:

      Good Morning Andrew, would their be any current benefit to adding the Vanguard Energy Fund Investor Shares (VGENX) to my current platform which mirrors the allocations suggested in your book Millionaire Teacher? My thought was with energy stocks “on sale” due to the low price of oil the addition of this fund could be a real benefit.

  7. Steve says:

    Hi Andrew,

    I just read your very helpful book. I don’t really consider myself an ‘expat’ since I am a Canadian citizen living in Canada, however I am also a UK and US citizen and this makes things a little complicated. I don’t want to fall foul of IRS Passive Foreign Investment Company issues but at the same time would like to avoid filing excess paperwork (such as IRS 8621 for Canadian mutual funds or ETFs). Therefore, I am interested in doing the Couch Potato or Fundamental Indexing with Schwab ETFs as per your chapter 15.

    My question is; should I buy the US domiciled Schwab ETFs that you list through the US dollar side of my TD Waterhouse brokerage account in Canada? Or should I buy them through my TD Ameritrade brokerage account that I set up in the US when I previously lived there? Is there an advantage one way or the other? Tax reporting issues? I intend to live out my days here in Canada or in Spain if I can swing it, but don’t intend on moving back to the US. Also, with the IRS reporting obligations becoming more and more onerous, I have even considered relinquishing my US citizenship.

    Regards,
    Steve

  8. Sim says:

    Hi Steve,

    As an overseas American, if you don’t know of this blog, I think you’ll find it very interesting.
    http://isaacbrocksociety.ca/

    It is especially geared to US persons living in Canada, but the same issues apply to all Americans regardless of where they live outside of the US. It discusses the tax issues you mention, as well as relinquishing US nationality. They are also suing the Cdn government for amending the Canadian privacy laws (IGA- Intergoverment Agreement) in order to comply with FATCA. If you haven’t given it a read, I suggest you take a look, I imagine it’ll answer a lot of your questions.

    Good luck,

    Sim

  9. Patrick V. says:

    Thanks for the clarification Andrew! One other question: I have significant amount of cash that I have not allocated to my index platform outlined in your Millionaire Teacher book mainly because my re-balance activity indicates putting the cash into the stock index to meet my desired ratio however since we are now in the sixth year of a bull run and are at record highs allocating the cash to the stock index just does not seem logical. Thoughts?

  10. Isaac Bliek says:

    Hello Mr. Hallam, My name is Isaac Bliek and I am a freshmen at South Dakota School of Mines and Technology. I received your book “Millionaire Teacher” as a graduation present and found it most interesting. I now find myself “hooked” on the stock market and the concept of investing. I would really like to begin investing my money and get a nice head start since I am only 19 years old. In your book you said that you can be more risky with your investments at a young age since you will not retire for 30 years or more.
    I was debating placing my money in index funds but the rapidly falling gas prices have caught my eye. I was wondering what you think about investing in oil stock? The prices are the lowest they’ve been in a long time and you always say “buy low, sell high.”
    Will those oil stock prices and the gas prices eventually rise again? any thoughts?
    Thanks, Isaac

    • Hi Issac,

      I’m not sure what you mean by “oil stock” because there are many such stocks to choose from. My best guess is that you might be referring to the oil and natural gas industry as a whole. One thing about being young, is that time periods may be different for you than they would be for an older investor. For you, a long time might be one year. But it shouldn’t be. One year is not a long time. You mention that the prices in oil stocks are “lower than they have been for a really long time.” When investing in the stock markets, 5 or 10 years should be considered a blip. If oil and gas stocks were lower today than they were 10 or 11 years ago, I would see your point. But prices of stocks within this industry are 40% higher today than they were just 5 years ago. So you will need to think more broadly about how to value an industry’s cheapness. On another note, when suggesting risk, I’m not talking about putting eggs into specific sectors….such as oil and gas. By risk,I’m referring to a heavier allocation of stocks versus bonds. In this case, as mentioned in my book, you could have no exposure to bonds (if you want to take higher risk). But be careful about a very short term price movement, and speculating based on that. Here’s the source for the oil and gas industry. Check the 5 year chart, relative to the benchmark. http://www.ishares.com/us/products/239517/ishares-us-oil-gas-exploration-production-etf

      Cheers,
      Andrew

      • Subash says:

        Hi Andrew,

        Just to follow up on the similar thread related to Oil prices. I agree your point on the specific stock picks in Oil & Gas industry. However am looking in investing in Oil Commodity ETF, eg. USO . Also i fully agree the price reversal for Oil might take 4-5 years or even more to be back to 60 – 80$ per barrel. However i would like to invest in chunks every month over the USO ETF for two years and average it around for 20-30$. Would you prefer this approach considering the long time horizon?

        Thank you
        Subash

  11. RogerK says:

    I just read Global Expat’s guide to Investing and loved it….great job. We also have a somewhat similar investing philosophy as I’m mainly in Vanguard and iShares ETF’s through an account at Virtual Brokers, who only charge 1 cent per share trading commission to a maximum of $9.99 with no annual fees. Currently I have a couple of Canadian dividend ETF’s as I’m still a Canadian resident so take advantage of the Dividend Tax Credit in a non-registered a/c. I also have a maxed out TFSA but no RRSP as it doesn’t make sense for me taxwise. However, I’m dual citizenship British/Canadian and, now my family is all in Europe, I’m thinking of retiring to southern Spain, again like you to get away from the snow and cold!

    From your analysis of offshore brokers on Page 180 it would appear to me that Saxo Capital Markets makes the most sense for me but I’d also been doing some research of my own, before I read your book, and came across Hargreaves Lansdown, who are open to non-residents, preferably in the EU. The advantage there is you’re covered by the government mandated Financial oversight Agencies and guarantees and their fees aren’t too bad for a non-North American brokerage. Trading fees are UKL11.95 down to UKL8.95, based on volume, and there’s no annual account fees for ETF’s, stocks and shares. However they charge 0.45%pa for mutual fund a/c’s which blows me away as they should also get a 0.25%pa trailer fee from the mutual fund companies, at least that’s what they do in Canada, and it may be different in the UK.

    The conundrum is where to domicile my portfolio or maybe even split it and which broker to use. I’m thinking I should probably follow Chapter 17 for the British Expats rather than Chapter 16 for Canadians, as I doubt I will ever go back to Canada, but could eventually end up in the UK.

    Your, and anybody else’s, thoughts and insights would be appreciated.

  12. RogerK says:

    It occurs to me that one way to avoid the US inheritance tax might be to incorporate a company through which to invest in the US. A company never dies and its the shares in that company that are part of your estate, not the actual investments. Whether this is a practical solution depends on the tax situation for company profits (the dividends, interest and Capital Gains generated each year) in the country in which you and/or your company reside so local tax knowledge would be imperative.

    • RogerK says:

      On second thoughts that will never work as the value of the shares in your company will reflect the value of the underlying assets so you’re no further ahead.

  13. Michelle says:

    Hi Andrew

    I’m just balancing out my portfolio based on your book (great second book by the way) and I’m looking at what the Bank of Canada has just said about lowering interest rates. There is some talk that Canada is heading into a recession.

    Do you think one should rebalance with an emphasis on Canadian ETF’s because the loonie is heading down and you can buy more… or should one rebalance more with international stocks? I might be getting this completely backwards – but I’m learning!

    Thanks for any input.

    Michelle

  14. Charlie says:

    Hi Andrew and everyone else on this forum,

    I bought Andrews book and read it in 2 evenings over Christmas. My eye’s have been opened. I can now see how my financial advisor used leading questions and tactics to get me to sign up to a 25-year Friends Provident plan. I have now surrendered the policy. When I handed in the documents to Friends Provident in Dubai, the lady who helped me just happened to have a pile of surrender forms with her. Seems like people are jumping ship daily and these products are being exposed for what they are.

    I have since spoken to many friends in Dubai about what they do regarding investments. Turns out most of them have a FP, Skandia, Generali, Zurich Plan and are totally unaware of the charges/penalties. I informed a friend who is actually a regulated fund manager. He and his brother in law had been sold 20-Year Generali plans. The brother in law had lost most of his savings from the army lost by investing in one of these plans. The Financial Advisor that sold the plan was confronted this week. He was threatened with legal action due to his lies and is now ‘making a plan’ to return the cash with a much smaller penalty.

    On that note, i feel that I need to warn people. Any suggestion son how I would word a Facebook status without incurring recriminations?

    I have also just opened a Saxo account and had a question. I am a South African who has been in Dubai for 8 years, has a small business here and does not know if I will ever return to SA. The Couch Potato Portfolio suggests funds for people who are moving back to SA or to another country. Apart from Vanguards All World Index, what bonds should I buy? Should they still be South African or not?

    Much thanks and I’ll keep spreading the word so that less people have to go through this.

    Warm regards,
    Charlie

  15. Charlie says:

    Hi Andrew,

    My posts don’t seem to be publishing. Are there problems with the site?

    Warm regards,
    Charlie

  16. Charlie says:

    Hi Andrew,

    I hope this message finds you well. I’ve been burnt by ILAS’s and have read your 2nd book.
    I am now on the cusp of buying funds through Saxo Bank. I am a 36 year old South African living in Dubai.

    I’m looking at a portfolio as below:
    30% Govi Bonds
    15% Satrix40
    40% Vanguard VWRD
    15% IWDP iShares REIT

    Your thoughts on this will be much appreciated.

    Warm regards,
    Charlie

  17. viki says:

    Hello Andrew,

    Thanks for a great read. I do however have one answer that your book doesn’t provide.
    What is the need to invest in your home countries stock/bond market?

    Surely if I am a South African who will return home one day, I would want Stocks/Bonds from other parts of the world that pay me in Dollars that I can convert to South African Rands?

    Does this make sense? Looking forward to your response.

    Viki

    • Hi Viki,

      Instead of thinking of a portfolio “end point” where you would convert your money into South African Rands when you repatriate or retire, consider this instead. Always keep your portfolio diversified across various currencies/ETFs. You won’t want 100% of your money in the South African market. At least, you shouldn’t, if you want to always be diversified. Diversification increases your safety. And owning ETFs from a variety of markets (and ETFs) increases your money’s safety. And if rebalanced annually, it can also increase your returns over time.

      Cheers,
      Andrew

  18. Viki says:

    Hi Andrew,

    Thank you for your guidance. You seem like a salt of the earth kind of guy. The world needs more of those.
    I was going to buy my stocks tonight based on your recommendations in your book.

    I can’t however find the Vanguard VWRL on Saxo. There is a VWRD available that trades on the London Stock Exchange in USD.
    Am I correct in assuming that they are basically the same and I can go ahead with confidence?

    All the best,
    Viki

  19. Viki says:

    Hi Andrew,

    Just a follow on my earlier mail.
    The VWRL and the VWRD are identical in makeup on Saxo.
    They tracked together for a few years and then the VWRL just took off.

    However, the VWRL is only available as Euro Or Swiss Franc and not GBP.
    I have a USD Saxo account and am now unsure which to buy.

    Your thoughts would be appreciated as I’m about to buy and don’t want to make a mistake.

    Warm regards,
    Viki

    • Hi Viki,

      I’ll do my best to explain this clearly. Both indexes track exactly the same set of stocks. But (and I’m taking your word for this because I don’t want to look it up) one measures the stocks’ growth in British pounds, the other in Euros. If the two currencies move in relative unison, you will see similar performance figures for each ETF. However, if one currency falls (as the Euro did) the ETF priced in Euros would have risen. Keep in mind, this is just an illusion. The ETFs have really performed identically.

      You can see how far the Euro fell using this link: http://www.oanda.com/currency/historical-rates/ The gain you see in one, over the other, is an illusion, measured in a falling currency. That currency, as I mentioned in my book, has absolutely nothing to do with the fund’s true value. The true value is reflected by the price movements of the equities in the index.

      Let me try explaining it another way. Assume you bought this index in two accounts. In one account, you purchased it in British pounds. In the other, you purchased it in Euros. Assume that the one in Euros gained 15% and the one in pounds didn’t gain anything. If you sold both indexes, and converted the proceeds to U.S. dollars, Australian dollars or any other currency (except Euros or pounds) you would notice that you made an identical profit with each index. Identical.

      So it doesn’t matter which index you buy. They are the same thing.

      Please let me know if this explanation makes sense to you. If it doesn’t, I’ll try another type of analogy.

      Cheers,
      Andrew

      • Viki says:

        Hi Andrew,

        Makes perfect sense. Thanks for clarifying.
        It seems like VEVE and VWRD are very similar in makeup, but VEVE is newer and slightly cheaper at 0.18.
        Would it make any difference to substitute VWRD for VEVE?

        Also, regarding Bonds, as a South African expat, could I consider VGOV instead of IGLO or SAAA?

        Much thanks,
        Viki

      • Viki says:

        Hi Andrew,

        Apologies for all the questions.
        I have settled on a portfolio and would appreciate if anything raises red flags for you.
        I have largely followed your suggestions in your book by using a Coach Potato with a Fundamental twist.
        However, instead of an All World EFT, I like the idea of weighting more towards the US and Europe.
        Am I crazy to ignore developing markets, or is this a solid portfolio?

        25% NewGov Bonds
        10% eRafi Overall SA
        45% VUSA – S&P
        20% VUER – Europe

        Alternatively, my other line of thinking would look like this:
        25% IUAG Bonds
        10% eRafi Overall SA
        65% VWRD

        Much thanks,
        Viki

      • Chris says:

        Cheers guys. Useful to follow these threads. Have been since the Muscat meeting. Since then, surrendered with FP and chose TD over Saxo.

        Now before I press OK for the first time can I just check this is about right. I have read book #1 but not #2, yet:

        30% IGLS
        35% VUKE
        35% VWRD

        I’m 32, English with GSOH. Love sports.

        Cheers!

        Chris

  20. Viki says:

    Thanks Andrew,

    This gives me great confidence to go ahead.
    One other question has come to mind when I checked what I could purchase on Saxo.

    I earn in USD, the 2 equity funds are only available as GBP.
    Obviously the eRafi is in SA Rands.
    Would it be wise to diversify further by getting my Bond in USD?

    Thank you,
    Viki

  21. Bao says:

    Hi, Andrew,

    I have a question regarding the timing for investment. Based on your book (p. 194, Chapter 14, Question No.9), it seems that timing to invest is less an issue as we never know when a good timing is. Are you saying that we should invest in stocks/bonds even their price hit the market high such as recent S&P 500 index?

    I used ‘dollar cost averaging’ method to buy 2800 Tracker Fund of Hong Kong (H.K exchange) on monthly basis yet I often bought at a relatively high price and so far the index performance is rather disappointing.

    Can you elaborate more on the timing of investment part?

    Thank you.

    • You can’t time the market Bao. So don’t even try. Just keep a diversified portfolio and rebalance it buy purchasing the lagging index…or by rebalancing it once a year. You will need patience–which unfortunately, most investors lack.

      Cheers,
      Andrew

  22. Raghu says:

    Hi Andrew-

    Your books have been a big eye opener to understand long term investing and taking my first steps…thank you.

    One question please elaborate: What do you suggest if one were saving for short-term capital needs with 2-3 yr time horizon for say a house down-payment etc.?

    regards,
    Raghu.

    • Hi Raghu,

      If you will need the money within a 5 year time period (or before) keep the money out of the stock market. You mentioned 2-3 years. Keep it in a savings account. Hopefully, you can find one that pays a tiny bit of interest, allowing for full, penalty-free withdrawals at any time.

  23. Raghu says:

    Hi Andrew-

    Sorry I felt I should elaborate my earlier question of saving for a 2-3 yr time horizon. Should I invest in 60-40 stock bond index portfolio or keep in cash?

    Thanks,
    Raghu.

  24. Tito says:

    Hi Andrew,

    After almost 8 years working abroad I finally understand what I have to do with my savings in order to build my retirement. I built my portfolio in February and I am very happy with the results so far! Thank you very much.

    I have a very simple question to you that I hope you can answer.

    I am European and planning to retire in Spain one day. In your book you recommend buying your bonds in the same currency of the country you want to retire (Euros for me) but in the chapter dedicated to europeans you recommend buying IBGS from UK exchange which is in pounds.

    I ended up buying IBGS from the Italian stock market in Euros but the rest of my ETFs are in Pounds (VEUR & VWRL). Did I make a mistake?

    Should I keep all my portfolio in Pounds to avoid currency exchange commissions every time I rebalance in the next 20 years? (I know I will have to buy euros when I retire though)

    gracias

    • Hi Tito,

      When rebalancing, you won’t have to worry about exchange rate hits unless the entities you rebalance are in different currencies. For example, assume your global stock index, European stock index and bond index are purchased off a UK exchange. Same currency. Because they are denominated in pounds, you won’t pay currency spreads when rebalancing. You mentioned “buying bonds in the same currency of the country you will be retiring” but I think you misunderstood, slightly. If you buy a UK bond fund off the Canadian stock market (priced in Canadian dollars) you actually don’t have any stake in Canadian dollars at all. The only relevancy is what the ETF is invested in. In this case, it would be British pounds, even though it is priced in Canadian dollars. Likewise, someone buying a European bond off the New York Stock exchange, in U.S. dollars, is actually buying bonds denominated in Euros. The U.S. dollar is irrelevant. The only exchange rate hit would be taken during the purchase of it (assuming the person is not paid in USD) and in the sale, if the person converts back to Euros. But these are slight, compared to the big picture. Hope that helps.

      • Tito says:

        Thanks for your answer Andrew.

        It makes sense having it all in 1 currency, I see. I wish this currency was Euros and not Pounds though, because one day, when retired, I will start selling 3-4% of my portfolio every year and I would be handy having it all in Euros to avoid currency spreads. right?

        I wish there was a way to build my coach potato portfolio entirely in Euros. Is that possible?

        • Hi Tito,

          One day (hopefully soon) that will be possible.

          If you are repatriating, you will likely need to sell everything at once and build a portfolio in your home country of residence. Can’t go tax free forever, if you’re moving back to a taxable jurisdiction. So you would only pay a currency spread (likely costing you about 1%) during one final sale.

          Cheers,
          Andrew

      • Darien says:

        Hi Andrew,

        I’ve been following this conversation with Tito closely.
        From what you explained to him, whatever the ETF is invested in is the important factor, not the currency or which stock market.
        How do you determine what it is invested in?

        VUSA is invested in only US companies, I understand that.
        However, VEUR for example is made up of UK/European companies.

        What I’m trying to work out is this.

        I earn in USD and have 2 equity funds in GBP (VUSA and VEUR) and a bond in USD on the London Stock Exchange.
        Would it make sense for me to sell VUSA and VEUR and buy VWRD as this fund is almost the same as holding the other 2 in terms of companies and geographical focus and is in USD, helping me to avoid currency exchanges?

        Warm regards,
        Darien

        • Darien,

          In your case, if you earn USD, then yes, this would be a good solution.

          Cheers,
          Andrew

          • Steve says:

            Andrew,
            I understand from the earlier discussions with Tito and Darien that it is beneficial to have all investments listed on the same stock exchange so that rebalancing can be handled without exchange rate issues.
            I am paid in EUR so ideally it would be best for me to trade on an EU exchange. However due to access to some ETF’s I cannot avoid London. Therefore I am trying to pick ETF’s listed only on London. This would incur an exchange rate cost when paying in new monies each month however I know there are ways to reduce this from links you gave earlier.
            Where I am getting confused is understanding in which currency an ETF is denominated in. Searching on TD Direct for VWRL (FTSE All-World) I receive 3 ETF’s. The only differences being the price currency in GBP, CHF or EUR. They are all traded in London so I thought the denomination would be GBP.
            If I was to purchase the EUR one what would be the advantage/disadvantages? Would it avoid the exchange hit when paying in new EUR monies but incur an exchange hit when rebalancing with a GBP ETF?
            I’m looking at using VWRL for my global ETF and VEUR for my European portion but they both come in different flavors.
            Thanks once again for your advice
            Steve

  25. RogerK says:

    You make a good couple of points, Andrew.

    Once you live in a taxable jurisdiction the main issue of where to hold your investments comes down to does that country have a double taxation agreement with where you live to ensure you don’t get taxed twice. This is particularly important to anyone living in Spain or the US or a citizen of the US as they get taxed on their worldwide income from all sources.

    The other point is keeping currency exchange fees to a minimum. To my mind you only want to exchange money into USD, GBP or Euros, for investment purposes, and the cheapest way to do that is through the low cost online Forex traders. If you get paid in or already hold any of those currencies just invest in them, if you can. Now I understand the selection of investments denominated in Euros is limited so you may have to change some money but only into either GBP or USD as virtually all ETF’s are available in both currencies or there’s a very similiar equivalent. For example, if you invest in an ETF denominated in GBP that tracks the S&P500 you will get the same result as if you invested in a USD denominated ETF tracking the S&P500 as its the underlying currency of the investment that matters, not the currency its denominated in.

    Do I understand you correctly, Andrew?

  26. DanielL says:

    Hello, Andrew

    Really great book, congrats. I’ve read it just after reading Malkiel’s Random Walk, and that was it for me, I’ve been evangelized by index/passive investing. Thank you!

    A quick question regarding currency. I’m Brazilian and I’ll be moving to Germany next September, where the wife and I will be living for the next two years, at least. I sold my apartment and am trying to setup an international portfolio with the money. The thing is, Brazilian real melted over the last year, and I’m not sure when I’ll be able to start adding money regularly to the portfolio.

    Should I wait for real to recover and invest locally for a while (1-2 years, not on stocks) or just choose the international brokerage and go for it?

    Best,

    Daniel

    • Just go for it Daniel. Over the next 25 years, you will have periods where your home currency is strong and periods when it is weak. But you will never be able to forecast, and shouldn’t. Dollar cost average, just as you would with any currency or investment.

      Cheers,
      Andrew

  27. Tony says:

    Just read your book Andrew – its a great read and money well spent! Your warning about US estate taxes on US equities, bonds and ETFs on poor unsuspecting non Americans was especially chilling for me – I’m a non resident Canadian using a US based Schwab non resident alien account. I was wondering if holding US based ETFs through a foreign corporation (and possibly getting a group together to save on corporation fees) would avoid the estate tax? Since the corporation does not “die” there is no estate tax when the shareholder (s) die? Or has this loophole been closed already and the IRS “sees through” the corporation and imposes estate tax anyway?

  28. RogerK says:

    @Tony

    I thought of the same thing too but then had second thoughts. Please see my posts above dated January 30th.

    Roger

  29. Abena says:

    Hi Andrew,
    I’ve bought both your books and they have taken me from ignoramus to…well…not-so-ignoramus. I am trying to work out which of the options to go for as a British teacher who will unlikely return to the UK. A friend of mine, with whom I discuss your advice a lot, brought nutmeg.com to my attention. Any opinions on their services, fees etc?
    Thanks for all you do.

  30. Sandy says:

    Dear Andrew,
    I am European working in China. I opened SAXO account in Singapore and from your blog discussions I learned that it would be smart to build a portfolio in one single currency to avoid currency exchange fees when re-balancing. So I chose GBP as a main currency and was ready to start building my Coach Portfolio with a purchase of VWRL from LSE in GBP.

    But guess what! I can not purchase it. This is what SAXO representative sent me:

    “We do not have GBP line for this ETF as there is a USD line for the same ETF listed in LSE. The link you copied below is right (https://www.vanguard.co.uk/uk/portal/detail/etf/overview?portId=9505&assetCode=EQUITY##overview). This ETF you are looking to trade has both GBP and USD line but in Saxo we can only have it in USD line and we are not able to set GBP line for trading as both lines share the same ISIN code and our system can only recognise one. Hence we have only the USD line instead.”

    Is this normal? My colleague who has an account with TD International doesn’t have this problem. He can buy VWRL in GBP from LSE and VWRD in USD from LSE without problems.

    I don’t know what to do. Do you have any comment on this?
    Thanks!

  31. dan says:

    do you have any comments using the 3% signal strategy by jason kelly. Is this a strategy you would consider.

    • Hi Dan,

      I am not familiar with the strategy. I rebalance my portfolio once a year, or I rebalance it by purchasing the lagging index each time I invest.

      Cheers,
      Andrew

  32. Alena says:

    Hi Andrew,
    Brilliant book – especially the latest one which made so much sense for where we are right now.
    As the Malaysian ringgit is so weak at the moment, we were thinking of following your couch potato method but using fundsupermarket.com.my to invest locally in the types of funds you recommend. If we transfer our ringgit out of Malaysia, we’ll lose a lot in the exchange. Is this a sensible plan or are we thinking about it all wrongly?
    Thanks again for your great advice!

    • Hi Alena,

      I’m glad you found the book useful. If Fundsupermart offers a low cost Malaysian stock market index, you could certainly use that as a starting point. Or you could open a brokerage account, as I suggested in my expat book, and buy something much more diversified, like a European stock market index (ETF). You can find some ticker symbols of products in the expat book, under the investing for Europeans sections. Despite the ringgit’s drop, you will notice that over the past 12 months, it still reports a gain over the Euro. Setting up a proper brokerage account (instead of using fundsupermart) will ensure that you keep costs very low during your investment journey. Here’s the link to the historical currency converter. Note the 1 year value of the ringgit, compared to the Euro, from one year ago. http://www.oanda.com/currency/historical-rates/

  33. Chris says:

    Hi Andrew,

    I am an UK expat overseas who has just had a child. I have set up an investment account in Singapore with Saxo as you suggest for myself . What can I use as a savings account for my child? Are there any dedicated trust fund accounts that I can setup offshore?

    Thanks

  34. Steven says:

    Hi Andrew,
    My first post on your website. I LOVE your books, and your website. Thank you for sharing all this information.

    I’ve invested in the expensive offshore funds. With growing doubts due to lack of transparency (even long before before reading your books), I moved onto local (Malaysian) unit trusts, initially at 5% service charge and then online portals at only 1% or 2%. So now I just suffer from the constant cold v’s malaria 🙂

    After reading your books & website, and researching further based on your references/notes…I’m now convinced on Passive Investing, and I’m about to embark on my ETF journey.

    As a European expat in Malaysia, I was thinking to buy Vanguard UK VWRD (FTSE All-World UCITS ETF) which cost 0.25%. I like the idea of XAW which you mention above, and I was also looking at other US ETFs on the TSX. However I think I’d effectively get hit with 30% withholding tax on dividends from TSX ETFs vs 15% LSE ETFs (since for TSX, there is a 15% WHT between US and Canada, and then another 15% withheld on dividend payments from Canada to Malaysia, whereas for LSE I think it would just be 15% between Canada and Ireland where most funds are domiciled). I know tax can be a complex area, but do you have any opinion on this, if buying VWRD would be better?

    Thanks!
    Steven.

  35. DerrickB says:

    Hey Andrew,

    I’m a late starter to investing, being 36. How would you suggest getting started in today’s market to best maximize possible returns towards retirement?

    • Hi Derek,

      I don’t know your nationality, nor do I know where you reside, so the question is pretty tough to answer. I did, however, write a book explaining how expats can invest. I covered virtually every scenario. Here’s the link: http://bit.ly/globalexpat

      Cheers,
      Andrew

  36. Geoff says:

    Hi Andrew, I’m finding your latest book a very informative and interesting read. I am a 48 years old Canadian residing in Hong Kong and wish to set up a Coach Potato portfolio (ETF and bonds on the HK Exchange as much of my funds is in HK$). I was wondering if you can advise on a broker since many, such as Saxo, require a minimum number of trades which I will not meet since I only plan to adjust my portfolio once or twice a year. Thanks.

    • Hi Geoff,

      There is no minimum trade execution for Saxo. They just offer a discount for those who trade a lot. I do, however, recommend TD Direct International. You will see them mentioned in my book. But they have dropped their annual account fee (it used to be 0.12% per year, I believe).

      Cheers,
      Andrew

  37. David says:

    Andrew

    I stumbled across this website when I was researching Zurich’s products that were being sold to me by a broker here in Singapore.

    I wanted to write to you, as I feel extremely fortunate to have found this site. 18 months ago we signed up to a 25 year plan with Standard Life – lured by what seemed to be excellent bonuses and flexibility.

    Thankfully, Standard Life has just announced that it is pulling out of Singapore (perhaps due to people not falling for what these funds are offering), and for us, we have ended up doing extremely well out of it – increasing our 18 months of contributions by a significant amount, and having Standard Life terminate our lengthy contract. with a full cash payout

    We were considering investing in a new scheme with Zurich, but thankfully I stumbled across your website. It was a huge reality check for me reading your articles, and I can’t help but think how stupid we had been agreeing to such a scheme previously.

    I have now bought and read your fabulous book “The Global Expatriate’s Guide to Investing”, and I have opened a Standard Chartered Account to start buying some low cost Fundamental Index Funds.

    I just wanted to thank you for your work. I have learnt a considerable amount from the book and this site, and I feel much better equipped to build a healthy portfolio. Previously, we have mostly focused our investments on property – we have a couple of properties in Australia, but I was really keen to diversify into funds in lieu of regular superannuation payments. My wife and I are still in our early 30s, so hopefully, thanks to your wisdom, this will set us on a good path to a healthy retirement, whenever that may be.

    Cheers and many thanks
    David

  38. jack says:

    Hey Andrew, I have just read your book Millionaire Teacher, and it has inspired me to start investing early. The problem is I will be going to Korea in August to teach english there for a year or more. During this time I will be a non resident of Canada. Therefore I can’t invest in TFSA and dont get any benefit from RRSP. Should I just hold off investing anything until I come back or should I go ahead and invest in TD e series index funds using a non registered account while over sea? I am unsure because people always tell me to invest in my RRSP and TFSA first, but being abroad makes this impossible.

    • Hi Jack,

      Don’t bother with an offshore account. You won’t be away from Canada long enough. You could contribute to a non tax deferred account in Canada (not a RRSP or TFSA) or you could simply wait until you get back to contribute what you have saved.

  39. WEdmond says:

    Hi Andrew,

    I’m a Canadian teacher living in teaching in Kuwait with my Irish wife. We have recently purchased a house in Ireland. We plan to use it as an investment property, a place to stay for a time in the summer, and possibly our retirement home. We are not sure where we want to retire. Canada, probably not. Ireland, maybe. Somewhere hot, most likely. We are both 37 years old and are late to the investing game. I’m currently reading your Expat’s Guide book and hoping to follow the Couch Potato method. I’m wondering if we should have exposure to the Irish market because my wife is Irish and we are buying a home here. What would you think about: 15% Irish Govt Bond, 15% Canadian Govt Bond, 5% Canadian Stock Index, 5% Irish Stock Index, 60% Global Stock index? I’m taking this from your book and tweaking it a bit. Also, I’ve explored the DBS and TD International to set up accounts. Can I open a DBS account if I’m resident of Kuwait?

    Any information would be appreciated. And thank you, thank you for advice you’ve provided so far!

    WEdmond

    • WEdmond,

      The portfolio sample you asked about would be fabulous. Just remember to rebalance it with new purchases or with an annual rebalance.

      Well done! If you get a few minutes, would you mind doing a writing a review of my book on Amazon? Here’s the link: http://bit.ly/globalexpat

      Thanks!
      Andrew

  40. Ben Charoenwong says:

    Mr. Hallam,

    I’m an SAS Class of 2009 student who’ s currently pursuing a PhD in Finance, and stumbled upon your book at a Kinokuniya while visiting Bangkok. I am pleasantly surprised that you have taken more to this, and I think you’re providing a great service to expatriates all over. I especially like your advice to focus on reducing fees (makes a massive difference!), and that each person’s portfolio should be different based on their nationality, where they expect to retire and live etc.

    Please keep this up! I am available via email if you would like to chat 😀

    Best regards,
    Ben

  41. James says:

    Hi Andrew,
    I am an Australian and was looking to contact one of the businesses you recommended in your latest book (Global Index Investment Company), however the email contact bounced back as undeliverable. I also cannot find any details about the business arm for Australians. Do you know if they are still operating?
    Regards,
    James

  42. Rick says:

    Hi Andrew, first of all I read your new book and wish I had years ago. I am a Canadian living in Singapore , hat left Canada over 17 years ago and have no Canadian assets to speak of. Since I am married to a Singaporean and we will likely retire in region splitting our time between SG and a property in Indonesia with short trips home.

    My question is since I do not have CAN assets how can I best get global exposure while avoiding US domiciled index stocks and or bonds?

    Thanks in advance,

    Rick

  43. Sheamus says:

    Hi Andrew,

    I recently read Millionaire Teacher and found it very informative. Thank you. I am new to investing and have about 40k to get started. Would you recommend getting it all into the markets now, or spreading it out over a period of time to potentially benefit if markets decline in the coming months?:

    Thanks.

  44. Mitesh Patel says:

    Hello there Andrew,

    I have read both your books and I must say it was your first book that has got me started on the path of wealth 3 years ago.

    I have invested in TD eseries funds in my RRSP. I am now a Canadian non-resident but RRSP is still there. I was recently told by TD when I changed my status as non-resident that I will be allowed to keep my RRSP but I will not be allowed to rebalanced my portfolio. Is that true. Would appreciate advise if someone knows. Thanks.

    • Hi Mitesh,

      I hadn’t heard that you can’t rebalance your RRSP as an expat. I do know that you can’t add money to it. As I mentioned in my book for expats, you may be interested in selling your RRSPs one year after leaving Canada. You would pay 25% tax on that. But…you could then invest the proceeds (as well as any other money you save) in a tax free brokerage. That depends, of course, on where you move to. But I have written a guide to describe this all here: http://bit.ly/globalexpat

      Cheers,
      Andrew

  45. Mitesh Patel says:

    Dear Andrew,

    Thanks. I thought so too. I am currently in Singapore so will perhaps fall in 15% tax bracket. Unfortunately, I have been away from Canada for over 8 years now and got hold of your book a bit too late I guess (my bad). Is there still a merit in withdrawing RRSP and reinvest as suggested? Look forward to your fresh perspective while I go throgh specific sections you have suggested in the book. Thanks and regards,
    Mitesh

    • Mitesh,

      You will likely still pay 25% witholding tax on your RRSP to the Canadian government–but none to the Singapore government. And to answer your other question, yes, it’s worth investing that money (and the money that follows) in an account whereby you won’t be charged capital gains taxes. My book outlines how.

      Cheers,
      Andrew

  46. David says:

    Hi Andrew

    Just a question regarding purchase of new shares…

    Recently the Aussie market went down, so im finding myself getting greedy and I want to buy some new shares.

    But, according to my asset allocation, im not sure if I should be..

    Aussie index: currently 34.77% (should be 33.33%)
    Bonds: currently 37.63% (should be 33.33%)
    International index: currently 27.60% (should be 33.33%)

    So technically, I should be putting fresh money into international stocks, right?

    But what about when a particular market drops, shouldnt we take advantage of the cheaper prices? After all, the discount may not be there next week, right?

    You see this month I was scheduled to put fresh money into international shares, but I am sensing an opportunity here with the aussie index…

    And while im on the topic, what if Aussie stocks just plumetted to really REALLY low prices… Does one just swoop and focus on buying the index for that market (even if it means their asset allocation has gone completely out balance)or is it wiser to continue to keep a balanced portfolio…

    Looking forward to your words of wisdom!!

    Thanks Andrew

    Dave

    • Hi Dave,

      You should purchase more of your international index this month. Always stick to the plan. Mr. Market will pull at your heart, trying to convince you to speculate. But follow your head and stick to the plan.

      Cheers,
      Andrew

      • David says:

        Yes, ok… I understand your distinction.

        Im also wondering if my rules are a little too strict (see below)

        On the 1st of every month I will purchase what ever is lowest % in the asset allocation.

        This means that if during the month if their are some ‘sales’ on, I am not a part of them.

        I know in your book ‘The Millionaire Teacher’ you said:

        “When prices fall, its a good idea to stock up on those products because the prices will inevitably rise again. If you like to buy canned beans and the store is selling them this week at a 20 percent discount, you have a choice. You can sit on your haunches and wonder whether they’ll be cheaper the following week, or you can stop being silly and just buy the beans.”

        This really made sense to me. But im kind of feeling my buy rules dont always allow me to take advantage of ‘short term’ sales… I mean, the super marker (stock market) may only be running the sale this week only. Next week the prices go up again and i have missed the sale, all because I only go shopping once a month (on the 1st) and I only buy the produce that im stocked up the lowest on (% wise)

        Are my strict rules disadvantaging me or are they serving me?

        Is there times when you would incorporate a sub-rule? Such as:

        a) If a sale occurs half way through the month, you will go shopping?

        or

        b) If a sale occurs on an item you are already stocked up on (in asset allocation %) then you will buy both produce for the month in order to take advantage of lower prices.

        Does this idea of sub rule have a place in investing or am I simply speculating?

        Thanks Andrew

        Dave

        • Hi Dave,

          I think you are speculating. Set the mechanical plan in motion and stay on course.

          Cheers,
          Andrew

          • David says:

            Thanks for your honesty… I will stick to the mechanical plan!! It takes all the emotion out of the investing…

            I do understand that the emotions that lead to mistakes in investing are greed and fear… Now and then I begin to get $$$ signs in my eyes and greed tugs at my heart and I question my rules…

            Thanks for reminding me…

            Dave

  47. Mitesh Patel says:

    Thank you so much Andrew. Appreciate your comments. Two more questions:

    1. I see a very small section on withdrawal of RRSP in the book but not the overall strategy. Which section are you referring to
    2. Is there any simulation/data that you could suggest I may refers to that might show keeping RRSP in the tax-free account vs. withdrawing now and paying 25% withholding tax upfront and how both approaches might fare eventually? Thanks much
    Mitesh

    • Hi Mitesh,

      I sold my RRSPs one year after leaving Canada. I have no simulation, other than what I did with my compound interest calculator. When you sell a RRSP, you will pay (as a resident) tax at your full marginal tax rate. When you sell from a tax free account (like mine, in Singapore) you don’t pay any capital gains taxes. Your account will be many multiples larger in the years ahead. If you plan to be abroad for many years, the tax free account makes plenty of sense. If you plan to stay abroad for 25 years (just an example) you could sell everything with a $500,000 profit (again, just an example) and not pay any tax on that. But if you plan to be abroad for just a couple of years, selling the RRSP doesn’t make sense.

      Cheers,
      Andrew

  48. Noah says:

    Hi Andrew,
    I , unfortunately, entered into two offshore plans. One Generalii beginning in 2005 with a 20 year term that I stopped contributing to monthly 18 months ago and another 4 years ago with a 5 year term with Friends Provident. This one term should be up in a year and I can get my funds back. The other I could withdraw and take a big penalty hit. I’ve read on your site and I think in your book that over time it’s still better to take the hit and go into a Vanguard Index with significantly lower fees. Right?? Another ? — is not the time to buy extra funds while the market is lower? Thanks! Noah

    • Noah,

      As I mentioned in this book, you will need to do your own math on this one. You pay about 4% per year in fees. What is your surrender value? Could you take the penalty hit and catch up? DO the analysis with a compound interest calculator. MoneyChimp has a good one. Determine 2 rates of compounding: 4% versus 8%. Take the balance after the penalty, and compound it out at 8%. Take the amount you have (assuming it stays there) and compound it out at 4%. Which one, during the relevant time period, comes out ahead during the relevant time period? This will give you the answer you seek.
      http://bit.ly/globalexpat

      Cheers,
      Andrew

  49. David says:

    Hi Andrew,

    Loved Millionaire Teacher! Currently searching for ETFs to put my savings in and I’m wondering about high dividend ETFs compared to the normal ETFs, for example VGG compared to VFV. The MER is a little higher for the VGG, but is that acceptable? And what would be the maximum MER you would e ok with?

    Thanks!!

  50. Lars says:

    Hi Andrew.
    Fantastic book very informative and well worth the investment. A few questions if I can. I am a British Expat previously resident in Singapore but now in Japan. I am restricted from trading any exchange based products including ETFs as I am contracted at the TSE. I would like to invest a lump sum from my Singapore and UK accounts into Funds. Whilst I am restricted from ETFs, I have found that the Fidelity Spartan range of funds are relatively low cost and track indexes – so suitable products may exist. However, I can’t work out how to buy into these given they only seem to be available in the US and I don’t have a US address. I would appreciate any guidance on what accounts to open or which fund provider to approach and also what low cost mutual funds you are aware of that would make up a suitable portfolio (approx. 15 yrs to retirement but location is not yet decided).
    Thank you
    Lars

    • Lars,

      That’s a fascinating dilemma. You can’t buy an ETFs off any of the global exchanges? Are you sure? Somehow, that doesn’t seem right.

      But…in case it is, as an expat, you are left with virtually no low cost options.

      Based in Singapore, iFast financial offers funds. Total costs for their index funds are just under 1%, I believe. You may want to look there. Before doing so, double check on what you could buy off the Australian or British exchanges. Something doesn’t sound right.

      Cheers,
      Andrew

      • Lars says:

        Andrew

        Thank you for the quick response. Contractually if I wish to buy exchange based products then I have to use an account held with one of two permissible Japanese brokers. However that would mean transferring my savings from Singapore into Japan. I haven’t confirmed with a tax adviser but I believe transferring the money to a Japanese held bank account in order to fund the brokerage account would expose me to remittance tax. Also the brokerage account would deduct full capital gains tax and potentially there is an exit tax when the money is taken out of Japan. Hence why I am looking to invest from Singapore but can’t purchase exchange products.

        Lars

  51. Mark E says:

    Hi Andrew
    Saxo feature highly in your book.
    Yet it appears they do not deal in US Funds which seems bizarre.
    I went looking for several funds from the Morningstar Fantastic 50 and have been told:

    “The below requested ISIN cannot be added as they are not trading in any of the supported exchanges and also these are mutual funds which we do not support

    Hope this helps.”

    Well no it doesnt actually! !
    This is Morningstar afterall who have probably been in the game as long as Saxo if not longer.

    Perhaps you can suggest a broker who can help.
    Regards

    • Hi Mark,

      I think you might be confused. With an offshore brokerage that allows stock trading or ETF trading (such as Saxo) you cannot buy U.S. listed mutual funds. However, you can buy all of the products that I listed in my book from each respective brokerage–that includes U.S. indexes, in ETF form, off the Australian, Canadian or U.S. market from Saxo. Don’t, however, buy U.S. domiciled ETFs as an expat. Remember what I said about U.S estate taxes.

      Cheers,
      Andrew

  52. Mark E says:

    Thanks for that.
    Are US mutual funds completely off limits to non US investors then?
    Regards

  53. Tom Shields says:

    Hi Andrew,

    I recently opened up a DBS Vickers account. I’ve never traded before and there are a couple of ETF’s I can’t find and I am looking for an acceptable substitute. I can’t find a US bond ETF (comparable to AGG) and I can’t find an international ETF comparable to IEV. I know you are familiar with DBS Vickers. Do you know which funds I should be using?

    Thanks so much.

    • Hi Tom,

      You don’t need a familiarity with DBS Vickers to answer these questions. If you are using DBS Vickers to buy off the Toronto Stock exchange, you need a familiarity with the holdings available on the Canadian exchange.

      Vanguard’s U.S. Aggregate Bond ETF (VDU) and Vanguard’s FTSE (ex North America) International Index symbol (VDU) are the ETFs you are looking for. You will also likely find my book, The Global Expatriate’s Guide To Investing to be an invaluable resource. Here’s the link: http://bit.ly/globalexpat

      Cheers,
      Andrew

  54. Mitesh says:

    Hi Andrew,

    Just got a rude shock when I accessed my TD eseries RRSP account and learnt that I cannot rebalance it. I cannot do anything except withdraw. As I have mentioned I am a non-resident Canadian living in Singapore but have kept RRSP.

    Any idea if there is any argument I could make to be able to rebalance? I dont want to withdraw it yet though I am tempted with this development. Thanks in advance for your advise.
    Mitesh

  55. Mitesh says:

    Dear Roger – thank you. I think that is a great idea. I have TD eseries funds for Canadian/US/International equity + Bond fund (4 funds in total) vs Vanguard Canadian/US/Developed world/Emerging word equity and Bond (5 funds) in non-Registered. Any advise on balancing? Thank you so much
    Mitesh

    • Hi Mitesh,

      You may have missed the point of Roger’s note. If you can’t rebalance your e-Series RRSP, as an expat, you need to look at your total assets. For example, total all of your assets for all of your accounts. What percentage do you have in bonds? In Canadian stocks? In U.S. or international stocks? Let’s assume you have just one account–your RRSP. You can’t rebalance it. But if you could, what would you buy or sell? Assume you would buy $3000 of the Canadian stock index because it has dropped so much. In such a case, Roger is suggesting that you add $3000 of the Canadian index to a different investment account–such as an offshore account with, say, TD Direct International. Your goal allocation can be maintained by looking at your total assets, as if it were one giant pot. I hope that helps.

      Andrew

  56. Mitesh says:

    Thanks Andrew and Roger. Got it now. Appreciated
    Mitesh

  57. Subash says:

    Hi Andrew,
    I recently (accidentally) found your page and its quite engaging. Thank you for sharing wealth of information and spread across your knowledge.
    Am an Indian working in Singapore for the past 5 years (Not a PR yet). I invested in Indian stock market predominantly in equities. Am planning to open DBS Vickers account in Singapore and invest in Index ETFs. However while I came across your expat links I found you are primarily focusing on Australia, US, UK, Canada and New Zealand. Any particular reason you are not covering other regions? Does your Global Expatriate’s Guide book cover only these regions or applicable to India and other countries as well?
    Also for Non-Singaporeans only selected country Expats can trade in Index ETFs through DBS Vickers?

    regards
    Subash

    • Hi Subash,

      My expat book does profile an Indian women who lives and works in Singapore. The book draws from every example (and nationality) I could think of….chapter by chapter.

      Cheers,
      Andrew

  58. Shyam Ramachandran says:

    Loved your book. Just wondering is there a way I can check the portfolio performance of the suggested etfs? Each at a different %? is there any does any website do this? Thanks for the great advice. Cheers, Shyam

    • Shyam,

      There are many websites that will do this. Try Morningstar.com. But do remember that looking at past performance is completely irrelevant. Just build a diversified portfolio of low cost ETFs: one representing a global stock index, one representing your home country index, and one representing a bond index. You will beat the vast majority of professionally managed money. My book explains, in detail, what you should know before you begin this journey. http://bit.ly/globalexpat

      Best of luck,
      Andrew

      • Jennifer Johnson says:

        Hi Andrew

        Another question for knowledge from me after reading as above-past performance is not reliable-i do believe investing via ETFs and other low cost investments are the way to go in preparing for financial independence. (Which I,m doing). However- I have this nagging feeling of doubt at the back of my mind: when retire I will sell off portions of my ETFs p.a ( the ones performing the best) leaving money in still to grow f course-but what abt rand (pound/dollar) cost averaging in reverse? U know one can invest a sum monthly and sometimes one gets more shares and sometimes less-now doing this in reverse to have money to live off will surely deplete one,s portfolio fairly quickly, despite only taking a certain sum. So although annuities cost a lot,surely buying one with a lump sum will give one peace of mind ( legally one has together that amt per year). This is quite worrying for me as I have and will have no pension from a work place and state type of pension either as SA does not have this. I was thinking to grow my portfolio and when I retired use half of it to buy an annuity so that I know I get a guaranteed income.

        Would like to know your thoughts on this.

        Thanks, Jennifer

  59. Josh Harrop says:

    Hi, loved the book and it saved me from stumbling into Friends Prov trap. I followed your advice for kiwi expats and contacted DBSVickers; fully unimpressed with reply; “based on your profile (presume they mean, living in Brazil presently) you have to apply in person in Singapore”… nice one DBSV, makes perfect sense… not worth the email time to contact them.

    • Hi Josh,

      As I mentioned in my book, anyone who wants to open an account with DBS Vickers must do so in person, in Singapore. Please consider TD Direct International if you can’t make the trip to Singapore.

      Cheers,
      Andrew

  60. Inge says:

    Hi Andrew,

    I have just read Millionaire Teacher. It’s a great book, and I intend to follow your advice, but I have a question about rebalancing your portfolio. You mentioned (p.91) selling bonds in 2009 to rebalance your portfolio. Isn’t there risk that doing so can incur a capital gains tax that is greater than the gains obtained by rebalancing your portfolio? How did it work out in your case?

    Regards,
    Inge

    • Hi Inge,

      Bond prices don’t move up much. They’re mostly flat (fluctuating slightly) as they toss investors interest. As such, there were no capital gains to realize when I sold those bonds in 2009. It was one of the best financial moves I ever made. If the markets fall, you should do the same. If they rise like crazy, skim off the top of the stocks to add to bonds. The capital gains will be minor, compared to the upside.

      Cheers,
      Andrew

      • Inge says:

        Hi Andrew,

        Thanks for clarifying. Capital gains tax in my country is 33%.

        If bond prices don’t move up much, would it not be better for young investors to invest exclusively in index funds instead of eg. 30% in bonds for a 30 year old? Even if the index funds lose value over a decade there is still plenty of time for them to rise before this person retires?

        • If you are comfortable doing that, go for it. Personally, I’m more risk averse. Think of the cost benefit analysis. Having, even 50% in bonds, doesn’t hurt long term returns much when you rebalance once a year. I like that security myself.

  61. Kahan says:

    Hi Andrew, my friends were talking about your book and I am glad I heeded their recommendation.

    I am eager to start building a disciplined portfolio and especially like the Couch Potato strategy. I am 32 and have picked up some questionable investment choices over the years based on hear say and sheer ignorance. Regretfully, they comprise of a mixture of forex CFDs (biggest mistake), unit trusts (just found out I was paying quarterly platform fees for one of them), RSP via Poems for 2 blue chips, and some other shares. I also picked up the Frasers 8 year retail bonds earlier this year. I don’t know where to start and what I should get rid of and how to calculate my current portfolio components. I saw earlier comments that Singaporeans can use their CPF as the bond component. But I also use the bulk of my CPF to pay my home loan.

    Can you shed some light and point me in the right direction? Meantime I am also focusing on reducing my home loan so I can also be debt free and will likely do a partial redemption soon. Thank you very much in advance.

    • Hi Kahan,

      The nice thing is that you can simplify your investments without having to pay capital gains taxes (by selling). Yay for Singapore!
      You may want to stream all of your money into a brokerage like DBS Vickers or Saxo Capital Markets. Go for a 15% Singapore government bond exposure, with the remainder split between a Singapore stock index and a global stock index. Then you own the world at the lowest possible cost.

      Cheers,
      Andrew

      • Kahan says:

        Thanks Andrew. But if I were to sell all my investments now I would incur substantial losses, can I do that gradually over time say over the next 12 months and move towards the 15% bond, 45% local stock index, 40% global stock index. I do realize you advised against timing the market, but I am still trying to get my head around my existing endowment policies as well and where that sits (bond component?). It’s quite a lot to absorb and some help would be so appreciated.

        • Kahan,

          If you are concerned about paying massive withdrawal penalties, I can understand your reluctance to liquidate your holdings and then reallocate them.
          But if you are reluctant to sell because your investments are recording a “loss,” then you’ll have to remove your heart from your decision-making process and use pure logic instead.

          This might help.

          Imagine a friend has $100,000 to invest. He asks you where he should invest his money:

          1. In a diversified portfolio of index funds
          Or
          2. In the exact same products that you own currently

          The above question answers itself.

          Now let’s bring this back to you:

          By holding your current investments, you believe that they will outperform a diversified portfolio of index funds over the next year, five or ten. If you truly believed that, you would add more money to them.

          Again, if you are worried about massive redemption penalties, that makes sense. But if you are waiting for the markets to rise, so you can sell your current investments, allowing you to start your index fund portfolio at a higher price than where the markets currently sit (remember that a rising tide raises all boats) then you need to re-think this.

          Cheers,
          Andrew

          • Kahan says:

            Thanks Andrew that really put things into perspective for me and I will proceed to liquidate my current portfolio. Your book mentioned having a 10% individual stock component if we truly believe in the companies that we are investing in and I also know you suggested earlier that I allocate 15% into a local bond index fund, but I am feeling somewhat risk adverse right now and am keen on a higher bond component so what do you think of this approach:

            25% Local Stock Index Fund
            25% Global Stock Index Fund
            10% Individual shares
            20% Local Bond Index Fund
            20% Global Index Fund

            I am doing some more research on using my SRS funds to purchase index funds, so believe I will also need to reassess my bond component further down the line. Thanks for being so helpful with this. I never had someone provide advice like you and am really appreciative of your time and effort to help me out.

          • Kahan,

            This allocation looks good. But here’s the most important thing I can tell you. If you choose this allocation, stick to it. Don’t try to guess what asset class will do well in the future and shift your portfolio accordingly. Don’t allow a panel of experts to convince you that they can see the future either. They can’t. This is the advice that usually falls on deaf ears. The decision is yours. If you stick to this allocation, come hell or high water, and rebalance annually, you will do very well over the next 30 years. If you start messing around with your money (like almost every else does) your returns will be mediocre, at best.

            Good luck with your emotions. It’s going to be your biggest challenger.

            Andrew

  62. Chris D says:

    Hi Andrew,

    My wife and I are Canadian Expats living currently in Brunei. We are ready to implement some of your strategies with our current and future savings that you outlined in your latest book. We are opening a DBS Vickers account in Singapore shortly but i have 2 questions before we do…

    1. My wife is 14 years younger than I am (47 vs 33) How do we break down the bond holdings with the age difference?

    2. We do not know yet where we will retire. We have an island cabin in the Ottawa Valley where we will spend several months a year but we will probably spend most of our time travelling the world in a specially outfitted 4×4 vehicle for many years. What do you think would be the best breakdown of ETF options for us? Would the Horizon Swap funds fit the bill? Do you still own them?

    Many thanks for sharing your knowledge and for writing a fantastic book. I will be giving it a glowing recommendation once everything is set up.

    Cheers
    Chris

    • Hi Chris,

      I still own the swap based ETFs. They comprise part of my portfolio. But I also have the traditional ETFs, just to ensure that I spread the counter party risk a bit. As for the allocation decision, consider your wife’s age. Statistically, she will live to an age that’s 3-5 years longer than you will live. And she’s 14 years younger. So this money will likely need to last 17 to 19 years longer than you. As such, it should lean more towards growth. Splitting your portfolio in thirds, between bonds and stocks, makes plenty of sense. Also, you may want to skip the Canadian stock index, or go lighter on it, considering that you might not move back to Canada.

      Cheers,
      Andrew

  63. Damian says:

    Hi Andrew

    I started your book, The Global Expatriate’s Guide to Investing, last weekend. It’s a real eye-opener and should be a must-read for any expat, anywhere.

    By way of background, I am British expat in Singapore. I am not sure a) how many years I will be here; and b) where I will end up living – could be UK, Malaysia, or even the US.

    On finishing your book, I plan to go down the ETF and Saxo route. I also have a Stan Chart account and will look at low-cost Fundamental Index Funds too.

    However, before doing so, I just wanted to know should I invest soley thru the London stock exchange? Or diversiy somewhat – say on the NASDAQ/NYSE?

    Grateful for your advice – and I will be sure to write a review of your excellent book on Amazon.

  64. Damian says:

    Hi Andrew

    I started your book, The Global Expatriate’s Guide to Investing, last weekend. It’s a real eye-opener and should be a must-read for any expat, anywhere.

    By way of background, I am British expat in Singapore. I am not sure a) how many years I will be here; and b) where I will end up living – could be UK, Malaysia, or even the US.

    On finishing your book, I plan to go down the ETF and Saxo route. I also have a Stan Chart account and will look at low-cost Fundamental Index Funds too.

    However, before doing so, I just wanted to know should I invest solely thru the London stock exchange? Or diversify somewhat – say on the NASDAQ/NYSE?

    Grateful for your advice – and I will be sure to write a review of your excellent book on Amazon.

  65. Oliver says:

    Hi Andrew,

    I was wondering if you could recommend an adviser based in Hong Kong for an Australian/Canadian couple.

    Regards,

    Oliver

    • Sorry Oliver, I can’t. A lot of offshore pension sellers run rampant in Hong Kong, where their commission money comes fast and furious. Why not just build a portfolio of low cost exchange traded funds? It’s very easy.

  66. Rowan says:

    Hi Andrew,

    I’ve just finished reading the Expat investing book, but I have a quick question for you. I am a Canadian living in Switzerland who gets paid in US dollars (I have a USD account so money doesn;t get converted to CHF unless I need to spend it in Switzerland). I know you recommend buying shares on an exchange in the country in which you plan to retire, but if I don’t know where I’ll retire, what currency should I hold my investments in? For example, are there forex benefits to holding US- traded ETFs instead of Canadian ones that outweigh the negatives of owning US-traded shares? Just wondering if there’s a rule of thumb on this. Thanks!

    • Hi Rowan,

      In the book, I warned against owning U.S. market traded ETFs. They will attract unwanted U.S. estate taxes. If you want to invest in the U.S. market, buy a U.S. stock ETF trading on the Canadian market. The currency of the holdings, as I mentioned in the book, is entirely irrelevant. For example, a European stock ETF, trading in Canadian dollars, has zero exposure to the Canadian dollar and full exposure to the Euro.

      Cheers
      Andrew

    • Hi Rowan,

      In the book, I warned against owning U.S. market traded ETFs. They will attract unwanted U.S. estate taxes. If you want to invest in the U.S. market, buy a U.S. stock ETF trading on the Canadian market. The currency of the holdings, as I mentioned in the book, is entirely irrelevant. For example, a European stock ETF, trading in Canadian dollars, has zero exposure to the Canadian dollar and full exposure to the Euro.

      You’ll find a detailed explanation of this on page 193. Throughout the book, I warn against non Americans buying off a U.S. exchange. One such example is on page 188. You’ll see many other page references to this in the index. Look under “estate taxes.”

      Also, the book does not mention my recommendation to necessarily buy shares trading on the market of the country you plan to reside (although that is convenient). I did, however, suggest that buying your future resident country’s bonds is a good idea. I get a feeling most people don’t read my book–they just skim it. Gotta let me tease you a bit!

      Cheers,
      Andrew

      • Rowan says:

        Hi Andrew,

        Thanks for the response. And I did read the book, I swear!! There’s just a lot of information to digest!! Anyway, thanks again for taking the time to answer dumb questions.

        Cheers,
        Rowan

  67. Tan says:

    Hi Andrew,

    Thank you (from a fellow international school teacher) for your book. As I am reading it, two questions keep coming up that seem contradictory:

    1. REBALANCING FUNDS: you recommended doing this, but this would require selling funds, which is a direct contradiction to your “buy and hold” principle as well as Buffett’s because of the charges and taxes incurred from the sale. With some bonds, if you cash them out before maturity, you can lose money. Can you clarify this question?

    2. BOND FUNDS: Suze Orman hates bond funds and doesn’t believe in having bonds-to-age ratio like many people recommend. Also, Warren Buffett also wrote in his will that 90% of his estate is to purchase a Vanguard S&P fund and10% in cash. I’m 32 , hopefully have 30 years of investing ahead of me, and have a 100% stock portfolio. I do have a CD ladder and cash in the bank that makes up 30% of my asset, but do I still need bonds? Should a person with a 30 year horizon still have bonds in their 30s?

    Thank you again, Andrew for your wisdom and insight!

    • Hi Tan,

      If you keep reading my book, you will notice that I don’t contradict myself. My ideas are consistent. When reading multiple people’s ideas, however, we will always notice that not all people share the same train of thought. It would take plenty of time to support my thoughts here—more time than I have. I hope that my book, The Global Expatriates Guide To Investing, answers your questions well enough.

      Cheers,
      Andrew

  68. Tj says:

    Hi Andrew,
    I’ve appreciated your replies before. Thank you for your support. I’ve been going through both of your books trying out the different options, but as a new Expat in Japan I’ve run into loads of problems. I am Canadian but am scared of investing in Canada as I’m not sure if I’ll end up retiring there. Any updates of where I can buy low cost ETFs as a Japanese resident. I’ve been contacting lots of places such as Singapore, but seems you need to be a resident. I used to be…wish I had set something up when I was there.
    Thanks,
    Tj

    • Hi TJ,

      You need to be present in Singapore, when opening an account with DBS Vickers, but you don’t need to be a resident. Unless something changed within the past 2 weeks, this has always been the case. That said, here’s something else that has always been consistent with DBS Vickers: many of their reps, on the phone, make mistakes. They don’t know the rules, but pretend that they do. This has happened to many people. Many have called back, spoken to somebody else, and they end up with a different answer. As mentioned, the last person who I know, personally, who flew to Singapore to open such an account (another Canadian) was able to do so.

      Please try again, then let me know.

      Andrew

  69. Karen says:

    Hi Andrew,

    I’m currently reading your guide to investing while trying to decide whether to invest with a Canadian bank or internationally. A colleague suggested TD international based in Switzerland but before I decide, I need to settle my residency issues with Canada. I’m single, Canadian, 29 and teaching at an international school in South Korea. I’ve considered seeking an expat advisor about my issue but many are charging upwards of $800. I spent the past 2 years teaching in the United States where, in my second year, I claimed non-residency (did not file Canadian taxes, although I feel I should have) and accidentally contributed the full amount to my TFSA, to which I was dinged by paying $1200 this year. I’m now worried about making further mistakes. Am I supposed to stop the interest earned from my Canadian banks as a non-resident?

    I’m also not sure of my current status with Canada – would it be best for me to claim non-residency and to sever ties or to try to reclaim as a deemed resident (in order to be able to contribute to things like TFSA)? Do these terms mean different things for the CRA and banks? My only connection left in Canada are my parents. I have bank accounts (savings, RSP, and the remainder of my TFSA), credit cards, a driver’s license and a passport.

    Most people suggested keeping my non-residency status to avoid filing/paying taxes (around 30% I’m guessing) of my salary earned abroad but I also do not want a hassle if/when I do decide to return to Canada. If I do return, it won’t be within the next 5 years.

    I appreciate any advice or insight you have. Thanks!

    Karen

  70. Fraser says:

    Hi Andrew,
    I live in Hong Kong and about three years ago I started a retirement plan with and agent at AIA . I was concerned with the 16 year plan but she told me I could stop making payments after two years. When a little while after the two year period was over I had a meeting with her and asked if I could take my money I was not happy with the return, yes, I could with huge penalty, I am sure she did not make this clear when selling me the product. So what do I do now? If I stop making the payments will the fees eventually leave my account broke? If I keep paying I feel I am just putting money into a bottomless pit. I have not made a formal complaint but I am thinking I might.
    Any advice would be appreciated.

    • Hi Fraser,

      See if you can get away with not adding any more money. The penalties to withdraw are steep. On the other hand, you could determine whether it’s worth taking the hit. My book shows a calculation that will help you with that. I should really get around to putting that concept on a blog article, but I haven’t had time.

      Here’s the book’s Amazon UK link: http://bit.ly/globalexpat-uk

      Cheers,
      Andrew

  71. Eliazid says:

    Hi Andrew,

    What is your opinion and advice on QROPs?
    Also would you be able to recommend a short list of IFAs in the UAE, preferably in Abu Dhabi, who are truly independent, competent, and reliable?

    Thanks and Regards.
    Eliazid

  72. Damian says:

    Sorry, Andrew: I posted a question earlier today re: brokerage charges – but then found the answer here: https://weinvest.net/blog/comparison-stock-brokerages-singapore/

  73. Amus Dow says:

    Hey Andrew

    I loved reading millionaire teacher, it was the perfect book for someone who is new to investing which i am.
    i live in vancouver bc and i have a few questiongs.
    woukd you recomend using rrsps and tfsa to invest with index funds/etfs or a cash account or all three?
    i like using my tfsa but the contribution limit could be a problem. when i max it out i will only be able to invest 5500 a year and i dont want to have to satrt fresh.

    as for rrsps i dont mind them but if something where to happen or an oppertunity presented itself and i needed some of my money it would be locked in.

    with a cash account i have to pay tax.

    if you dont mind me asking what type of account do you use to invest? any input is awesome

    thanks
    Amus

    • Hi Amus,

      You should be able to access your TFSA account at any time, so you might want to max that one out first if you think you might need that money. That said, don’t put anything in the stock market that you aren’t prepared to leave for at least five years. The stock market isn’t the place to store short term money. Markets can gyrate wildly. I live abroad, so I don’t have a TFSA or RRSP account. Expatriates aren’t able to contribute to them.

      Cheers,
      Andrew

  74. Charlie says:

    Hi Andrew, I trust you are well.

    I asked a question a while back, not sure if you saw it or not, so I’m trying again.
    I have been buying VWRD and IGLO for the past year on Saxo. I would like to add a corporate bond (15%) and a REIT (10%).

    I would like to know your thoughts on adding LQDE from iShares. It seems a solid option.

    On the REIT, I found IDWP and UDUP. This is my main question, IDWP is a global ETF, while UDUP is US only, but is cheaper.

    With my current portfolio in mind (VWRD and IGLO both being global), which REIT would you choose?

    Warm regards,
    Charlie

  75. Oscar S says:

    Andrew – read your book in less than 5 hours..absolutely devoured it and having lived in Malaysia as a UK expat for 8 years I have become almost immune to the pestering financial advisors trying to get me into QROPS and ditching my UK pension for some high cost scheme in a far off land…I actually proved to one of them, based on their own charges and transfer costs that it would take me 8 years to get my pension back to the pre-transfer level…and the agreed!!!

    Anyway, I have some money to invest and have opened a TDI account in Luxembourg. Whilst I agree with the logic on short-term gilts and inflation, in a close-to zero inflation environment would longer term (sub-10 year gilts) offer a better option, or is that already priced into their cost, making them less responsive to ay uptick in inflation ?

    I’m 53 and am looking at a split of 35% short term bonds, 15% longer term bonds, 30% UK equities and 20% developed word equities (all Vanguard products).

    Any reason I shouldn’t diversify to Vanguard’s FTSE 250 vs their FTSE 100 ETF ??

    Thanks for any advice.

  76. Gabe says:

    HI there

    I was recently talking to someone about my portfolio – 70% VWARD & 30% SAAA, which was based on your wonderful book. Their feedback was as follows and I wanted to seek your feedback:

    1) The expense ratios, at .25 and .20% are a bit high for what at first glance seem to be passively managed funds. At small $, that doesn’t seem like a big deal. But you can probably achieve similar holdings with an expense ratio under .1%. Consider SCHB, VOO, VTI, etc.
    Similar for bonds.

    2) You’re decently diversified, but consider exposure to a few more categories. You seem to have international exposure with VWRD at first glance, but I didn’t notice REITs, small cap, mid cap, etc

    Thanks

    • Gabe,

      The person who gave you that advice was looking to catch an extra minnow for dinner, without noticing that a shark was stalking from behind. As I mentioned in my book, any ETF that trades on a U.S. exchange (SCHB, VOO, VTI) could cost your heirs a tax penalty of 35% or more, when you go off to your ultimate reward. If you’re OK with that (no children, no life partner) then go for it.

      If you own a broad market index, you will already have exposure to REITs, mid cap stocks and small cap stocks. That said, if you want to isolate them with a specific ETF for each, and rebalance, you could certainly do that. During some time periods, such a portfolio outperforms. During others, it drags a bit.

      Cheers,
      Andrew

      • Mario says:

        Hi Andrew,

        Thank you for the book and for this blog. I read your very informative book twice this year and have been devouring the information on the blog. Great stuff! This is my first post.

        I’m a Canadian expat in the Middle East. Not likely to retire in Canada. Have set up an account with TD Direct Investing and built a portfolio using the building blocks you recommended in the book (VDU, VUN, VEE in addition to VSB). The sector weightings of the stock ETFs, however, do not seem to have real estate elements.

        I’d like to add a global REIT component. Been searching on the TSX, and could only find iShares Global Real Estate Index ETF (CGR) at a relatively steep MER of 0.71%. It’s nicely diversified though. Vanguard does not seem to have a relevant ETF in Canada.

        An alternative is iShares Global REIT ETF (REET) on the NYSE at 0.14% MER. But it’s much less diversified compared to CGR. I’m not planning to have the REIT component reach US$ 60,000.

        My questions are:
        1. Do you know of another global REIT on the TSX that is cheaper?
        2. I’m thinking of having 15% REIT out of my total portfolio. Is this too high? I recall you recommended only 10% in an article on AssetBuilder.
        3. Are there any issues for a Canadian expat to invest with the NYSE other than the estate tax for assets exceeding US$60,000?

        Your thoughts and advice would be greatly appreciated.

        Thanks in advance for your time.

        • Hi Mario,

          If you own any property (a house, a condo) then I don’t suggest you add a REIT ETF. If you already own real estate, you likely have a lopsided allocation to real estate, unless your investment portfolio is valued well above a million dollars.

          Otherwise, you might like Vanguard Canada’s REIT ETF. It costs just 0.39% per year
          http://beta.morningstar.com/etfs/XTSE/VRE/quote.html

          Just make sure you keep the allocation below 10%.

          Cheers,
          Andrew

          • Mario says:

            Thanks much Andrew.

            I don’t own ‘real’ real estate. This is why I thought of adding REIT.

            The Vanguard ETF is a good option but it’s all Canadian real estate, and I already have 35% Canadian bias through VSB while I’m not sure if I’ll retire in Canada.

            I have to give this some more thought. But I’ll definitely keep the REIT allocation to below 10% as you advised.

            Cheers.

  77. Michael says:

    Hi Andrew, just read your book – loved it! I didn’t have a DBS Vickers account, but I do have a trading account with Standard Chartered SG – and their brokerage fees seem to be even less than DBS Vickers … unless I’m missing something? Any reason to use Vickers over Standard Chartered (here is their fee page: https://www.sc.com/sg/ways-to-bank/online-trading.html

  78. Amus says:

    Hi andrew
    Thanks for your response on my last question a couple weeks ago.

    I have a question about how I should build my portfolio. I’m thinking of building a diversified couch potatoe portfolio, but I would like to utilize my rrsp and my tfsa ( I live in vancouver bc).

    So my question is do you think it is wise to split up the etfs in my couch potatoe between my rrsp and my tfsa or a cash account for example canadian index and Canadian bond index in my rrsp aND international index and us index in my tfsa. Or would you recommend I put my whole portfolio in one account.

    The reason I have this kanundrum is I would like to utilize both my tfsa and rrsp and possibly a cash account at some point but I don’t want to have a full couch potatoe portfolio in each because I would have to pay the fees again for each account.

    Anyhow that’s my question, any input is awesome. I just read your second book, soaked it up like a sponge. Keep up the good work.
    Cheers
    Amus

  79. David says:

    Hello Andrew

    I currently invest in 3 index funds…

    1) Australian shares index (33.3%)
    2) International shares index (33.3%)
    3) Bonds index (33.3%)

    At the beginning of each month I invest in the index with the lowest %…

    What I have noticed (this month so far included) is that the indexes can be on ‘sale’ during the month, and that the sales can be very temporary…

    In your book you talked about getting shares when they are on ‘sale’…

    So, should I
    1) Have a rigid rule that allows purchase to be a fixed time every month…
    2) Allow flexibility of time of purchase during the month if an index drops significantly…

    Thanks Andrew

    • Hi David,

      In the end, you won’t time the low points consistently. Just stick to mechanical simplicity at a given time each month.

      Cheers,
      Andrew

      • David says:

        Thanks Andrew…

        This is sound advice… I will stick with this…

        Also, can I clarify what you ment in your book (TMT) when you talked about getting shares on ‘sale’… You used the supermarket analogy, and you said that items can be on sale for short periods and its wise to take advantage of sales when there on, and not wait until the following week (speculating)…

        What did you mean by this? How does that fit in with a mechanical system?

        Thanks again Andrew

        Dave

  80. Leo says:

    Hi Andrew,

    I really need your advice.

    I am reading your book “The Global Expatriate’s Guide to Investing” and discovered the scam that is investing my money in Zurich Vista.

    I am in the 15th month of the Initial Contribution Period and my fund is valued 25,833.90 USD

    If I cancel the fund now, I receive nothing back.

    Do you think I should just assume that I’ve lost $25k and cancel the whole thing while is still early?

    At the moment I still don’t know about how much percentage of fees they are deducting monthly.

    • Leo says:

      So, I went personally to the Zurich office in Dubai and asked face to face about the charges.

      This is the figure they gave me:

      Total zurich charges
      4.75% per year
      ——————–
      Mutual Fund charges
      1.5% per year

      By using the compound calculator and your book information, I found that if I keep putting 2.000USD each month, in 25 years at a market return rate of 8% I will lose 828.000USD against investing the same money on a 1% platform fee.

      Is this calculation correct?

      Please I would really appreciate your response, as much as I’m appreciating reading your book.

      • Leo,

        If you invested $24,000 per year ($2000 per month) for 25 years and the market earned 8% per year, but you deducted 1% for annual fees, you would have roughly $1,624,235.

        If you invested $24,000 per year ($2000 per month) for 25 years and the market earned 8% per year, but you deducted 6.25% in annual fees, you would have roughly $757,690.

        Good for you, for going directly to the devil to ask how much of your soul he would take.

        Cheers,
        Andrew

  81. Rob says:

    Hi Andrew,

    Recently read your book and was very interested in the intent behind Fundamental investing ETFs. A quick look on line and Canadian exchange fundamental ETFs have dramatically diverted from the market curve to the downside over the last few periods. Why is this happening?

    • Hi Rob,

      Fundamental ETFs have a higher tilt towards value stocks than growth stocks. For the past five years or so, growth stocks have beaten value stocks. These two investment styles often flip. Ironically, as soon as people give up on one style or the other, they flip back! As I mentioned in my book, just build your portfolio based on a set course and action and stick to that plan.

      Cheers,
      Andrew

  82. Angela Simpson says:

    Dear Andrew,

    My husband and I short of devoured your two books, Teacher Millionaire and Global Expat Investing just before we moved to the UAE a few months ago. At the moment we have a small pot of 50,000 CDN available immediately and around 8,000 CDN to invest per month.

    Will it be more advantageous to our end game in 30 years from now to have started our index portfolio (35% bonds/55% stocks) this year, or to have started with real estate? Or would it be wise contribute equally to both from the start?

    Thanks for starting such a timely and important discussion on finances. We are incredibly grateful.

  83. Angela Simpson says:

    Dear Andrew,

    My husband and I short of devoured your two books, Teacher Millionaire and Global Expat Investing just before we moved to the UAE a few months ago. At the moment we have a small pot of 50,000 CDN available immediately and around 8,000 CDN to invest per month.

    Will it be more advantageous to our end game in 30 years from now to have started our index portfolio (35% bonds/65% stocks) this year, or to have started with real estate? Or would it be wise contribute equally to both from the start?

    Thanks for starting such a timely and important discussion on finances. We are incredibly grateful.

    • Hi Angela,

      That’s not a question anyone can answer without seeing the future. In fact, if anyone tries to answer such a question, run from that person. They would have to be suggesting that they could see the future: for both real estate and stocks. And nobody can do that for either. As Warren Buffett says, forecasters will fill your ears, but never your wallets.” I’m sure that doesn’t make it any easier!

      If you really are emotionally split, invest half of your proceeds towards real estate and half towards a diversified portfolio of stock and bond market indexes.

      Cheers,
      Andrew

      • Angela Simpson says:

        Hi Andrew,

        We are emotionally split, if only because we worry about how inflation will affect our ability to live on the amount we save now, especially if we choose to return to Canada in our retirement years. We sense that investment properties have to figure somewhere in our portfolio. Thanks for the food for thought and all the best in 2016!

        Cheers, Angela

        • Angela,

          It makes no sense to worry about what you can’t control. Diversified portfolios of stock and bond market index funds have crushed inflation, as has intelligently selected real estate. You won’t come ahead every year. But over 30 years? Most definitely. Worry about other things, like what you’re going to have for lunch. Splitting your assets between the two shouldn’t cause any long term concerns.

          Cheers,
          Andrew

  84. Angela Simpson says:

    Point taken 😉 Lunch it is! (and many thanks!)

    Regards,
    Angela

  85. Benjamin Pommeraud says:

    Hi Andrew,

    First of all, thanks a lot for your work. Your advise are very similar to what my INSEAD finance teachers where promoting! The difference is that you give recipes on how to do it!

    Here I go: I am a French expat living in Singapore. I don’t really where I will retire, in maybe 20 years, but to be honest France is not on top of my list. However, if I understood correctly your book, you recommend that European expats invest in European instruments. Is it for tax reasons? I am ok having some euro based ETFs as a way of diversification but is there any other aspect I didn’t get?

    Lastly, about the fact that non-US citizens would be taxed on US instruments. If on my DBS account I buy SP500 indexes traded in Canada, does it count as a US instrument or not? In other words, I feel that investing in US instruments is totally avoidable. Am I wrong? Is it correct to say that I can access Vanguard funds, for instance, indexing the whole world, from Canada?

    Thanks a lot for your time

    Benjamin

  86. Charlie says:

    Hi Andrew,

    Happy new year, almost.
    I am currently running a portfolio of 70% VWRD and 30% IGLO on the LSE.

    Do you see anything wrong with buying other funds to makeup the following portfolio.

    Stocks:
    VWRD – 50%
    IDP6 (S&P small cap) – 10%
    IDWP (global REIT) – 10%

    Bonds:
    IGLO – 15%
    LQDE (Corporate Bond) – 15%

    Although this is not an exact Ric Ferri portfolio, I’ve been reading some of his articles and like his thinking.

    And one last question, why do you never recommend TIPS / Treasury Bonds in your books for non-Americans? They seem to perform well relative to some of the Global Bonds?

    Warm regards,
    Charlie

  87. Jeremy Semple says:

    Hi Andrew, I’m a 29-year-old Canadian who got into index investing a year ago, after reading your book. You were actually my Socials, English and Fitness teacher at Robb Road back when I was in grade 7! I still consider you one of the coolest teachers I had growing up ? Your Millionaire Teacher book has been an amazing tool for my father and I, who have followed the couch potato portfolio. Right now I’ve got a portfolio of around $40,000 in these indexes:

    25% VSB (Vanguard Canadian Short Term Bond Index)
    25% VUN (Vanguard U.S. Total Market Index)
    25% XEF (IShares Core MSCI EAFE IMI Index)
    25% XIU (IShares S&P/TSX 60 Index)

    I’ve also got some shares in BMO and CIBC.

    I’m invested in a TFSA through my bank’s direct investing account and nearing the total contribution limit of the TFSA. The yearly contribution limit for TFSAs right now is $5500 and I’d like to put more than that per year into my investments. I know they have their limits when it comes to investing, so what I’m wondering is if you think it’s a good idea to stay with the TFSA or to put my money somewhere else? I think you mentioned in your book that the Vanguard Canada website was a good site to invest through?

    I’m also wondering if you think those 4 index funds are a solid base for my couch potato portfolio?

    Thanks very much for all your advice so far!

    Best Regards,

    Jeremy

    • Jeremy Semple says:

      Sorry that question mark after ‘growing up’ was supposed to be a happy face lol.

    • Hey Jeremy!

      It’s great to hear from you! I’m also thrilled to see two things:

      1. You already have $40,000 (wow!)
      2. You have a fantastic looking portfolio.

      As you know, contribute the maximum to your TFSA and RRSP accounts. You can build them with the same products you already have. If you have leftover savings after maxing out both (you would need a high salary to be in that boat) then open a taxable account with the brokerage you use (it’s just a regular investment brokerage account, not a TFSA or RRSP) and add further proceeds to that.

      Again, congratulations!

      On another note, do you recall, in my book, how I rode my bike 110 km a day to work. It was from the north end of Campbell River to Robb Road. You were in my class then. In the book, I also mentioned how I was cycling home when a teacher saw me at a gas station, and suggested that the other teachers should take up a collection so I could buy a car. That gas station was Merville. The teacher was Mrs. Swanson.

      Cheers,
      Andrew

  88. Andrew says:

    Hi Andrew,

    I left a comment/questions back on 17 Nov, just wondering if you have any advice on that? In case the original comment was too long and included too many questions, I’d be grateful for your thoughts on just the two main points:

    1. As a British expat with their savings in a Singapore account, but no longer residing in Singapore (now living in Korea), is it still a good idea to invest these savings (e.g. in something like a Vanguard global tracker ETF) out of Singapore (as opposed to transferring them to Korea and investing from here… dunno if this is a stupid question!)? I read your (brilliant and incredibly helpful) book, but coming from my super-ignorant knowledge base about personal finances, I’m still not clear how the tax works, and what the implications are for that depending on where I’m living, paying income tax, buying the fund from etc.

    2. I notice in your most recent comments you suggested StanChart to someone over Saxo and DBS Vickers, based on their latest policies/rates/fees. Would you suggest that also in my situation (my savings are in a DBS bank account, for what its worth)? Or are you aware of any particular options or considerations for expats in Korea, or any legit advisers or resources for expats in Korea?

    Many thanks for the great book, and any guidance you can give on these two questions.

    • Andrew,

      To the best of my knowledge, there isn’t a brokerage in Korea that would suit your needs. Keep your account in Singapore. I don’t know your nationality, so suggesting one brokerage over another isn’t possible. As a Canadian, for example, I can’t use Standard Chartered to buy off the Toronto stock exchange. I wasn’t implying that SC is a better brokerage than DBS Vickers or Saxo. My apologies if I gave that impression. That commenter may have given some specific details, and perhaps (considering those details) I suggested that SC was a nice fit for them.

      Cheers,
      Andrew

  89. Gabe says:

    Hi Andrew

    You’ve given me some great advice on your site, and thanks to your book, The Global Expatriates Guide to Investing I have started my ‘Global Nomad’s Couch Potato Portfolio’ which is still relatively new. By way of some background info, I am a British citizen living in Israel and have no plans to return to the UK.

    One thing I did want to ask, however, is your opinion on diversification between property, shares, etc. For example, I’ve recently come into some money which would be enough to pay off my mortgage in Israel. I’m tempted, however, to only put 50% of it into my mortgage and add the remaining amount to my ETF portfolio. On the other hand, it would also be nice to live without any debt. I’m 39, have no debts and earn an respectable salary with an employer contributed pension in Israeli shekels. Any thoughts? Would love to hear your opinion.

  90. Gabe says:

    sorry, when i said no debts i meant no other debts apart from my mortgage 🙂

  91. josh says:

    Hi Andrew, thanks for your book, helped me cut through the dross. Have since taken to moving my money to TD in Luxembourg, love the service and interface and already made my first two contributions to a diverse portfolio, in ETF Asia/LATAM. Wanted to move on bonds in the next and saw your reference to Global bonds ETFs but am really having trouble finding anything “non local” in the Morningstar options. E.g. my money arrives in Lux as Euros, so Euro denominated bond funds are limited to Eurozone bonds (quite a specific and exposed area of bonds). How does one go about getting a diverse bond portfolio without investing on a range of markets, incurring currency costs and potential tax implications? I’d love to just buy a global bond ETF on the Amsterdam exchange as with Equity ETFs… perhaps I’m missing something?

    • Hi Josh,

      The options aren’t perfect. I don’t believe that you will (yet) find what you are looking for. New ETFs, however, get added every year. One day, you will get your wish.

      Cheers,
      Andrew

  92. Mike says:

    Hi Andrew,

    As a Canadian non-resident, I’ve read your book Global Expatriate’s Guide to Investing and got a lot of useful advice regarding ETFs and the sharks to watch out for. Nonetheless I’m still in a bit of dilemma about what to do with my RRSP account in Canada. I have informed my broker, BMO Investorline, that I am no longer a resident of Canada (I’m actually in Germany) and they told me that I would need to move my account out of BMO Investorline since they don’t support non-residents.

    This is fine for my other accounts but I would have to take a tax hit for my RRSP. I’m planning on returning to Canada in a few years, not by 2017, but a bit later than that (probably by 2019-2020) and I don’t want to withdraw anything from my RRSP account. Nonetheless I have not found a brokerage that would accept my RRSP. Nobody seems to deal with non-residents.

    Do you know of any brokerage that would accept my RRSP account? If not could you suggest an alternative course of action since I don’t want to take a tax hit as of yet?

    Thanks

  93. Mike says:

    Hi Andrew,

    As a Canadian non-resident, I’ve read your book Global Expatriate’s Guide to Investing and got a lot of useful advice regarding ETFs and the sharks to watch out for. Nonetheless I’m still in a bit of dilemma about what to do with my RRSP account in Canada. I have informed my broker, BMO Investorline, that I am no longer a resident of Canada (I’m actually in Germany) and they told me that I would need to move my account out of BMO Investorline since they don’t support non-residents.

    This is fine for my other accounts but I would have to take a tax hit for my RRSP. I’m planning on returning to Canada in a few years, not by 2017, but a bit later than that (probably by 2019-2020) and I don’t want to withdraw anything from my RRSP account. Nonetheless I have not found a brokerage that would accept my RRSP. Nobody seems to deal with non-residents.

    Do you know of any brokerage that would accept my RRSP account? If not could you suggest an alternative course of action since I don’t want to take a tax hit as of yet?

    Thanks and keep up the good work

    • Hi Mike,

      When your bank says they can’t service your account, they aren’t likely saying that you have to close it. Ask them this question:

      1. I am moving to Germany for a few years. I know that, while overseas, I can’t add to my RRSP. I know that I can’t rebalance it either. But can I just leave it with you?

      Please ask the question that way. Then let me know what they say.

      Cheers,
      Andrew

  94. Mike says:

    Thanks for the quick response Andrew. Yeah they’re not going to close my account just “lock it” meaning that I can’t trade. Nonetheless they say that they strongly encourage me to move the account elsewhere. I know that as a non-resident I can’t contribute anything to my RRSP but it really bothers me that I can’t rebalance. There are really no brokerage services that would take my RRSP?

    • Mike,

      No other Canadian brokerage would let you rebalance that portfolio as an expat. But don’t sweat it. Sometimes rebalancing will enhance returns. Sometimes, it doesn’t.

      Besides, as I mentioned in my book, you might be better off selling it next year, after you have taken a full tax year abroad. By doing so, you would just pay a flat 25% tax. You likely got a 35-40% upfront rebate when you invested that money in the first place. Then, you could take the proceeds and put them in an offshore brokerage account. It would be even more efficient than a RRSP. When a resident Canadian starts to sell RRSP holdings, they pay tax at their marginal rate. You could live overseas, generate a $1 million profit on your account after 20 years (or whatever your time frame) then sell all or some of the portfolio and not pay a stitch of tax.

      I think you are getting worried about your RRSP account for nothing.

      Cheers,
      Andrew

  95. Dan says:

    First off, finished reading your Global Expatriate’s Guide.. best book I’ve gotten my hands on as a US Expat; however, with all the PFIC and FACTA going on in the US world one thing that isn’t’ really talked about is how to minimize (or keep away) PFIC. As a future edition suggestion a talk through of U.S. registered funds and what they mean for expats would be amazingly helpful.

    • Hi Dan,

      My suggestions, in the book, was for Americans to avoid PFICs because of their potential taxation mess. I didn’t refer to the acronym, but I did say that Americans shouldn’t buy non U.S. domiciled products. But thank you. Referring to the acronym next time will help those who might know what it is, and who might be looking to see it.

      Cheers,
      Andrew

  96. JPExpat says:

    Hi Andrew,
    In your book one has to choose between one of a few portfolio types and one has to then stick to that to that one portfolio type to see it grow and not switch portfolio types.
    I am debating the couch potato one or the permanent one.
    I was thinking of doing the two of them separately; so manage each type independently; split monthly contributions to each, or you recommend not doing this, better just pick one of the portfolio types?
    Thanks
    JPExpat

    • JP Expat,

      Consider your reasons for wanting to do that. Here’s what would likely happen. One of them would outperform the other over the next year, 3 years or 5 years. You would then deem this the “better” strategy. At this point, it would become your portfolio….exactly when it shouldn’t.

      Choose just one of the methods. And stick to it forever.

      Cheers,
      Andrew

  97. Sally says:

    Hi Andrew,

    With respect to Expat investing, you recommend “it’s important to have a home country bias when building a diversified portfolio”.

    As it turns out, I don’t actually have a “home country” – well at least not one where I ever intend living again (I hold a UK passport). I have no idea where I might end up retiring one day. What bias would you suggest is relevant for me in terms of portfolio diversification?

    Thanks!

  98. Mrs J Mulcahy says:

    I am non-resident Canadian, living in Ireland. I attempted to contact TD Waterhouse, Toronto today. All links revert to main TD website. I asked if, as a non-resident Canadian, I could open a Direct Investing account. See exchange below. I would appreciate your comments.

    MY INQUIRY:
    I read that TD Waterhouse, Toronto and TD Direct Investing International, Luxembourg, both offered ‘expatriate’ accounts in Andrew Hallam’s book “ The Global Expatriate’s Guide to Investing” (ref: p176-77; p221-23).

    Was Mr Hallam’s information incorrect for both these institutions? Or correct at the time of publication (c2015), but now outdated? Or are neither of these firms related to TD?

    TD REPLY:
    From: TD Customer Support
    Sent: 24 February 2016 16:30
    Topic: PERSONAL INVESTING – OTHER
    Subject: non-resident direct investing

    Hi,

    Thanks for reaching out today.

    In order to open a TD Direct Investing account you must be a Canadian resident. As you are currently in Ireland, you will be unable to open the account.

    All the best,

    David
    Digital Communications Officer
    ___________________________________
    TD Canada Trust 1-866-222-3456

    ________________________________________
    Moderator’s Note: Comment has been modified to remove email, links.

  99. Jason says:

    Hi Andrew,

    I’m looking for a point of clarification from the Global Expat’s Guide. On page 211 you reference some Vanguard Index Funds. I have enough money to select either VFISX or VSBSX as my bonds safety net. Is there a large differences between the two, or is it a “six to one half dozen to the other” choice? My confusion stems from the fact that VSBSX is not the Admiral Share of VFISX.

    Thank you for the clarification.

    • Hi Jason,

      There’s only one difference between the investor series and the admiral shares: the admiral shares have lower expense ratio costs. But you need a minimum of $10,000 to start a position in them.

      Cheers,
      Andrew

  100. Tim says:

    Dear Andrew,

    I wanted to write and thank you for the two books published. Whilst disheartening from the point of view that I must have been every financial advisers dream it feels good to be able to do nothing now to save future losses. I did, however, want to ask about any pension schemes you could recommend. I am a British teacher currently living in the UAE. I took my pension out of the U.K. on the advice of said financial shark whilst living in South Korea. It is currently in an Old Mutual Wealth fund. I have asked about charges to close the account and move the funds and I am waiting for a response from the company before weighing up the overall losses. Moving it though seems like the right them and I’d like it to go into the right pension fund where if anything happens to me it goes directly to my wife and where it escapes the financial advisers Mercedes Benz upgrade payments!

    Thank you for any help

  101. Tim says:

    Dear Andrew,

    Thank your reply. I am in the process of building a portfolio along the lines you suggested in your book using TD. I just wondered if it was different for money that had been put away as part of my UK pension? The way my financial adviser has explained it, I can’t touch the funds until I retire. Am I just being incredibly naive? In your book you mentioned other examples of people who closed their pensions at a cost – I will work out my costs but my financial adviser was adamant that I couldn’t touch pension funds I’d pulled from the UK until I was 65. At this point I just feel incredibly stupid and I’m concerned that he is misinforming me to keep me in this fund. In short, can I transfer this pension fund and put it straight into bonds and shares as you recommend in your books?

    Thank you and apologies for such basic questions

    • Hi Tim,

      This depends on how “pension” is defined. If it’s a defined benefit pension, your advisor will be right. If it’s a collection of unit trusts, he is likely misleading you.

  102. Raven says:

    Hi Andrew,

    Which bank do you think has the best value for investment (commission charges etc)

    I am currently looking at standard chartered which i think offers the lowest cost among all the other banks.

    Thanks!

    • If you want access to only a limited number of exchanges and you have small amounts to invest at a time, then Standard Chartered is fine. They don’t allow access to the Canadian markets, nor some of the other markets that brokerages like TD Direct International offer access to. Their brokerage fees are higher than with TD Direct International. But they are great for Singapore or British investors who are investing relatively small sums. If you are investing large sums at one time, Standard Chartered turns out to be slightly more expensive, by comparison.

      Cheers,
      Andrew

  103. Al says:

    Hi Andrew,

    I have read both your books and got quite a bit out of them!
    I have a six figure portfolio right now consisting of both Index funds and Gov Bonds with RBC. I would like to take advantage of the Vanguard rates (as they seem to be much lower). My concern is the service… It has been 2 weeks now that I have been trying to reach someone from the Vanguard Canada team. No one picks up when you call there. I have left messages on the general line twice. I have contacted one of their Reps and left him a message as well. At this point Im not sure I even want to deal with Vanguard . Is there any other product you could recommend for me in the Toronto area?
    Thanks in advance,
    Al

    • Hi Al,

      I am not surprised that nobody at Vanguard Canada wants to engage in a conversation. That’s not really what they do. Instead, they simply list ETFs on the Toronto stock exchange. If you open a discount brokerage account, you will be able to buy any of Vanguard’s funds through them. Go to Vanguard Canada for a complete list of funds. Keep it simple. Buy a global stock index, a Canadian stock index and a short term government bond index. It’s that easy.

      Cheers,
      Andrew

  104. Karin says:

    Hello Andrew,
    My husband and I have read both of your books and are trying to get ourselves organized financially now that we are expats. We are ready to put our plan into action, however it has been quite a challenge! We are Canadian and have now just been granted non-resident status. We have tried to follow your advice and open a direct investing account. We tried with TD , they would not allow it since we are working in Tunisia. I also tried RBC , same response. I have contacted Jason Heath and he told me to give DBS Vickers a try. Do we really have to open an account in Singapore in person? We are feeling very discouraged as we just want to get organized and be aware of all potential tax issues. Do you have suggestions for us? Do you know of other Canadians that have not been able to open accounts. I worry because we haven’t been investing since we left Canada and know that time is ticking. Can you help? Should we contact WealthBar? We need advice and support!
    Thanks

    • Hi Karin,

      If you need advice and support, Wealthbar might be able to help. But what you want to do isn’t difficult. The firm, Interactive Brokers would very likely allow you to open an account. From there, you could buy the ETFs listed in my book. Here’s the link: https://www.interactivebrokers.com/inv/en/main.php

      Cheers,
      Andrew

      • Brad says:

        Hi Andrew,

        Firstly, thank you for opening my eyes to a whole new way of financial planning.

        I have read both of your books this past fortnight and am now inspired to make some financial adjustments!

        I know your very busy so will keep this as brief as possible:

        • I am a teacher in Shanghai, China. I will not return to the UK or retire there, I intend to retire in SE Asia in 20 yrs or so.
        • I have a UK property- which is debt free and rented out.
        • I’m 35 and have a young family, my wife teaches too.

        I intend to follow the Couch Potato Investment method

        Two questions:

        1. I presume I will need an offshore brokerage in LUX, HK, or SING to avoid CG on my portfolio of investments? From your advice in Global Investor, DBS Vickers looks best to suit my needs.
        2. I currently have a large sum of money which I am probably going to invest in an apartment in the UK, I will buy this outright, before I begin my fund (I’m keen to diversify further before committing entirely to the fund) Does this sound sensible?

        Thanks again!

        Brad

        • Hi Brad,

          Since my book was published TD Direct International has since lowered its costs. They also offer access to the UK exchange, which DBS Vickers does not (without going through their phone banking method and paying 1% on every trade). Just make sure you exchange your money into the currency of your ETFs before sending money to TD Direct International. Don’t let TD Direct International exchange the currency for you, unless you follow this strategy: https://andrewhallam.com/2016/03/how-to-reduce-the-currency-bite-with-td-direct-international/

          Cheers,
          Andrew

          • Brad says:

            Hi,

            Many thanks for your reply, Andrew, it’s much appreciated.

            I will follow your advice and look into TD International (it’ll save me time and money on the Singapore trip too!)

            All the best for the future!

  105. Thomas says:

    Dear Andrew,

    Great book, that was really an eye opener for me after doing some bad decision on stock market.

    In short, I am French soon to be PR, in my early 30 and my wife is Singaporean. We are living in Singapore but we are not sure how long we will stay and where we will retire. It could be France, Singapore or somewhere else, we don’t know.

    I opened an account with Standard Chartered and I guess it will be wise for me to have as much as possible an international exposure. My question is, will it be interesting for me to include Singapore index and bonds to my portfolio? If yes, what kind of percentage will you recommend?

    Many thanks
    Thomas

  106. EwenCameron says:

    Hi Andrew, can I have your opinion please. Myself and my wife currently have around £50,000.00 in a mutual fund managed by SJP in UK. We are going to open our SAXO account in next few weeks. Should we take our money out our SJP account and add in (there’s no charge) or just leave it. Many thanks, Ewen

    • Hi Ewen,

      I’m not familiar with UK tax law, so I can’t comment on the most prudent decision.

      Cheers,
      Andrew

    • Phil says:

      I think depends on your residency, future plans and whether its in an ISA wrapper.
      UK capital gains law is complex and has changed recently, so might be worth seeking professional advice.

  107. Alex Bunting says:

    Hi Andrew,

    I have been trying to follow your advice since I bought your guide to expat investing and came to a talk you gave here. I was wondering if i could ask your advice one more time?

    I am a British citizen living and working in Vietnam. I followed up my reading with some searches of your site which revealed both Saxo and DBS appear to have raised their costs. So I decided to go with TD, whom you also suggested… but then I found they don’t do business with people resident in Vietnam! Are DBS or Saxo still the best alternative brokerages?!

    Thanks so much!
    Alex

    • Hi Alex,

      There is a DBS Vickers location in Vietnam. I spoke to some teachers at South Saigon International School (Canadians) and they opened an account and built a portfolio of low cost ETFs.

      Cheers,
      Andrew

      • Alex Bunting says:

        Hi Andrew,

        Thanks for this – my only concern with DBS was that the cost of putting money in was, at minimum, 1.5% for stock bought on the UK market (50 GBP or 1% min for DBS and 0.5% UK stamp duty). This seemed rather high. The Stamp Duty is avoidable and not payable on all ETFs, an not on bonds – but the 1% to DBS is.

        I have been trying to get the same info from Interactive Brokers who look on first sight to be cheaper, however their ‘contact us’ part of the website is broken and so am struggling more there.

        I realise they are holding the money in the US, but I think as long as I don’t die I can move it out of the US when I move somewhere that TD will accept me. But maybe I need to speak to a UK financial advisor about that 🙂

        Thanks for the reply!
        Alex

  108. Malathi Michael says:

    Hello Andrew,
    I’m a novice at investing and have been reading your book. Are still invested in VEA? The average annual return for that ETF is listed as -1.59%. Does looking at the average annual return even make sense in picking em.

    Thank you for your time!
    Malathi

  109. Phil Burnage says:

    Dear Andrew,
    I have recently moved to Shanghai- I’m from the UK looking to make China my home- getting married to a local etc. I’m 45 and also looking to invest for retirement. I have a UK teachers pension already saved for but looking to save for the next 20 odd years here too. Where is the best place to open brokerage – Singapore? How easy would it be for me to add funds to it seeing what a pain China is for getting money out of the country. Is there a brokerage that allows transfers using Union Pay?

    • Hi Ryan,

      I’m assuming that you are American. I don’t know of the most efficient tax circumstance for you. Ask your accountant.

      Cheers,
      Andrew

    • Hi Phil,

      I’m not familiar with the best methods for getting money out of China. But I recommend TD Direct International’s brokerage for investing, if they will let you open an account. If they won’t, you should be able to invest through Interactive Brokers. That’s a firm’s name. You can find them online.

      Cheers,
      Andrew

      • Phil Burnage says:

        Many thanks Andrew. I have applied to open an account with them- the multi- currency account- is that the right one? I am guessing I should just keep my investments to the UK market ftse ETF and the global index funds? It’s been a while since I read your book and have moved countries since then but the idea is we will retire here with regular visits back to the UK- wife is a Chinese citizen. I don’t trust the Shangai market at the moment- it’s lost an amazing amount since I came here in August last year or should I be looking to invest in a tracker for it too? What would you recommend?

  110. Ryan says:

    Andrew. I’m an American living & teaching in Ghana. I’ve had my investments w/ USAA in a mutual fund, but they’ve recently told me that I can no longer invest in the product as my physical address changed. I’ve just finished reading the Global Expatriate and I’m inspired to build my own portfolio. I can still invest using USAA, but I’m curious how they might stack up against some of the others you’ve mentioned in the book. I’m a complete rookie here, but eager to make it work. Any insight or thoughts would be appreciated.

    • Hi Ryan,

      I had to look the firm up, online. Their expense ratio charges are roughly 18 times higher than that of a low cost exchange traded index fund. It looks like a pretty typical actively managed fund company. Why pay about 1% in annual fees when you could pay 0.05% to own the U.S. market?

      Consider opening an account with Interactive Brokers and building a portfolio of low cost ETFs.

      Cheers,
      Andrew

      • Ryan says:

        Thanks Andrew for the quick response and insight. I’ll start looking into that right away. I’m still a little intimidated by it all, but I’m determined. I really appreciate the help.

        One more question. Is it best to open separate accounts for my wife and I, or is it an option to pool our money in one account?

  111. Del says:

    Great book Andrew! I am 55 and have around 1 million in rsp and savings. Just about all in mutual funds. I checked the 4 etf’s you recommend to be diversified and am struggling with the returns, XIU,XBB,XIN, XSP. As well, can these etf’s be put in an rsp?

  112. Barbara Reynolds says:

    Hi Andrew! I’m a teacher at Saigon South International School where you recently came and presented. Since then I have purchased your book and started talks with my financial advisors through AXA. I have 100K invested in a Cornerstones account that I found out recently contains no index funds but does invest in bonds, stocks and is considered a modest risk retirement account. When I pressed my financial advisor about fees he seems to want to dodge that question and keeps referring to my returns of between 5-8%…..I want to move my money around and have told him so….while still asking about the percentage of fees charged to me for maintaining this account…I’m getting real annoyed and in the meantime have contacted one of the advisors you recommended but haven’t had a reply from them either….Thoughts?

  113. Barbara Reynolds says:

    American/nationality

    -I sent inquiries to Asset Builders, Scott Burns. And looked at Vanguard and RW Investments…..still waiting to hear from my guy at AXA. Apparently that account is invested in 60% stocks, 40%bonds….that’s all the info he has given thus far….

    Barbara

    • Hi Barbara,

      Vietnam is a tricky place. AssetBuilder and Robert Wasilewski tag on to a brokerage called Schwab. They use Schwab’s platform. Schwab has decided that they won’t open accounts for people who live in Vietnam. If you use Wasilewski’s services, but open an account with a company called Interactive Brokers, you should be good to go. Please reach out to Robert Wasilewski one more time. Put my name in the subject of your email. Then keep me posted.

      Cheers,
      Andrew

  114. Barbara Reynolds says:

    Andrew: Here’s what my financial guy said about fees…1.7% on the base and that includes no additional fees charged from him, then 1.05% on the guarantee? Said yeah he could help me open up another fund…that includes index funds….apparently this account with these fees has a guaranteed return of 5%, ? but I suppose after you subtract the fees it’s probably less than that….

    Anyway, what do you recommend I do? I am heading to the US in June for a few weeks, and usually add money to by retirement account…. but seems I need to open up different one….pls. advise….thanks alot!

    • Barbara,

      Investments with “guarantees” tend to be very costly. This is much more expensive than anything I recommend. Have you given Robert Wasilewski another shout? Please keep me posted on how that goes.

      Cheers,
      Andrew

  115. Jacqueline says:

    Hi Andrew,

    I’m 26 and have $8000.00 as a lump some to start my index investment portfolio. I have been reading your Millionaire Teacher book and have been basing my portfolio on what you have been suggesting for Canadians. However, since you’ve written your book Vanguard and iShares have come out with new ETFs with lower MERs.

    I am planning to take moderate risk and to have a “couch potatoe” approach to my investments. Below is what I am currently thinking of what it will look like. Do you have any thoughts on whether I should be swapping out any of these ETFs for others?

    VSB Vanguard Short-Term Bond Index ETF 25%
    VCN FTSE Canada All Cap Index ETF 25%
    VUN Vanguard U.S. Total Market Index ETF 25%
    XAW iShares Core MSCI All Country Wld ex Can ETF 25%

    Thank you kindly,

    Jacqueline

  116. Barbara Reynolds says:

    Andrew:

    Am having trouble logging into Rob’s web site, not sure if that has a block on it too….hopefully he will contact me after you sent that email. Thanks for doing that…will wait a few days and if I don’t hear from him through email will reach out….

    Guess I need to take my 100K and invest it elsewhere real soon. Shame as I thought I liked my financial advisors but his silence on my pointed questions has me thinking that he really is worried that I am on to him!

    In addition to that account, I have a small TIAA CREF account with about 25K, and a small Vermont teachers retirement…plus 200 shares of Berkshire Hathaway B stock….I am 57 years old and plan on working for at least another 5-8 years….that big chunk of money in AXA came from working for 5 years in the Middle East!

    Thanks for your support and guidance….we’ll see what kind of fight it will be to take this money out of AXA and invest it somewhere else….What if my guy says he can reinvest that money for me, what accounts should I focus on and what percentages?
    Barbara

    • Hi Barbara,

      You should keep the money with TIAA Cref. They are a non profit, low cost firm. You could also keep the Berkshire shares. But the other money should be switched. Your advisor hasn’t placed you as his top priority. He placed himself #1.

      Cheers,
      Andrew

      • Barbara Reynolds says:

        Heard from Robert! Thanks for the connect….Am speaking with my current financial advisor tonight and will connect with Robert after that……any recommendations on where I should put my money and what sort of percentages being an American….thanks as always,
        Barbara

        • Barbara,

          You can trust Robert Wasilewski 100%. He’s one of the rarest people in the financial services industry. Let Robert guide you. He truly is superb.

          Andrew

  117. Shawn says:

    Hi Andrew,

    I was just wondering with a few states in the US looking to increase state wages, how does an increase in US wages affect the Canadian dollar?

    Thanks,
    Shawn

  118. Vaughan says:

    Hi Andrew,

    We met at your presentation at SSIS in Vietnam. We are looking into using some of the companies you suggested such as WealthBar to help us with our investments. In searching, I have found a similar company called Modern Advisor. In reaching out to both and reviewing their websites, I was thinking about using ModernAdvisor.ca . Have you heard of them or have any concerns?

    In their response to me they said they are creating a service specifically for Cdn expats to be unveiled this spring. They did a free fund report on my current investments which showed my average fees in the 2.5-3% vs theirs at .7%.

    Thanks for all your help and you’re great presentation and book!

    • You’re welcome Vaughan. I have not heard of this firm, but I’m glad they’re willing to open accounts with expats at a reasonable price. Out of curiosity, why are you choosing them over Wealthbar? Wealthbar is already set up to take expats and they cost a lot less than 0.7%. https://www.wealthbar.com/pricing

      Cheers,
      Andrew

    • Vaughan, it looks like Modern Advisor’s overall fees are similar to WealthBar’s. They each charge about 0.5%, not including the slim costs of the ETFs. I’m currently writing an article about Wealthbar for Canadian expats. They appear to have a strong proven track record of accepting expats.
      Either way, both will be a good decision if ModernAdvisor ends up capable of accepting expats.

      Cheers,
      Andrew

      • Vaughan says:

        Thanks for the info. To be honest, I hadn’t necessarily chosen one over the other, but something about Modern Advisor appealed to me including the analysis of my current holdings and that I did not need $25k to start an account. What does ‘being capable of accepting expats’ mean?

        I do have a follow-up question about taxes. With being a Cdn expat who is investing with a Cdn advisor, am I supposed to be paying taxes on income earned from the investments? Or only in the future when I withdraw them as income? The CRA website is quite confusing.

        Can’t wait for the article, will be most helpful!

        • Hi Vaughan,

          You’ll find that most Canadian financial services firms won’t accept expats. It has to do with how their regulatory rules are determined. I don’t know where you currently live (that makes a big difference to your second question about tax). But if the country you live in does not require you to pay taxes on worldwide income, you will only pay 15% dividend withholding taxes on dividends (which will be taken at source) and no capital gains taxes on any future increases or sales.

          Cheers,
          Andrew

  119. Tong Wei says:

    Hi Andrew,

    I am at 21 yo student pursing my degree in Singapore. After reading your book, i am really hyped up and interested about investing earlier (as you mentioned in your book).
    I have about 300$ to spare per month after expenses etc. I have looking to invest in local etfs first, which only leaves me with two options, SPDR and Nikko AM.
    Which of the two would u recommend?
    Secondly, which bank should i use to open my investing account? My friend told me that standard chartered has one of the lowest fee. However i found out that it has only limited number of exchanges and it doesn’t allow accss to some markets like other brokerages offer access to. So, as for now, since i am only investing relatively small sums at once (a month), which bank would you recommend?
    thirdly, which bank would you recommend if i have larger sums to invest at one time and want access to other markets?
    Lastly, you said in your book to invest in international index funds too. I have read up on some, but i am not really sure which few should i really be considering and which country should i be focusing on.

    Sorry for asking so many questions (and being an novice, asking stupid or no brainer questions (if i had asked any)).
    Hoping for a reply.
    Regards,
    Tong Wei

  120. Rudolf says:

    Hi Andrew,
    Please could you help !!!. I am a South African currently working as an English teacher in South Korea. I have researched extensively about stocks, ETF, bonds etc. Including reading you book “The global expatriates guide to investing”. I thought that Saxo capital would be a good discount brokerage firm to use but I now have discovered on there website that if you want to buy bonds there is a minimum order of 50 000 euro. I’m not sure if I’m reading incorrectly here but I would not be able to build a couch potato portfolio with that kind of minimum. This is the link:
    http://uk.saxomarkets.com/prices/bonds/?int_cmpid=uk:bonds_see%20all%20trading%20rates_1

    Could you please advise me on the best (cheapest) platform that I can use to build my portfolio on.

    Your book was really informative and I definitely recommend people that wants to invest to buy it.

    Thank you in advance for your time and help.

    Kind regards

    Rudolf

    • Hi Rudolf,

      The good news is that you would not be buying bonds directly through Saxo. You would be buying bond ETFs, with are comprised of numerous bonds. To make those purchases, you don’t need much money at all. You could do it with as little as $100 or less. That said, wait until you have a couple of thousand dollars because there is a small purchase commission with every ETF purchase or sale. That commission, for Saxo is usually a minimum of $25. But if you invest $2,000, $5000, or even $20,000, I’m guessing you wouldn’t push that commission above $25. The ETF symbols can be found in my book.
      And Rudolf, if you get a chance, would you mind posting a review of my book? Here’s link: http://bit.ly/globalexpat

      Cheers,
      Andrew

      • Rudolf says:

        Hi Andrew,

        Thank you for the speedy response and advice. I do have about just over 10k saved specifically for investing without touching my savings. Iv’e done some more homework and decided not to use Saxo as there other fees are very high especially the inactivity and custody fees. I have found a different company in Luxembourg called keytrade. they don’t have any activity, custody or account fees. They are a bit expensive in transaction fees but its only once off which is great , I think. Can I ask you which company you would recommend ? or what you think about keytrade ?

        I have rated your book on amazon and I just want to say thank you very much. Hope everything is going well.

        Regards

        Rudolf

  121. Chris Dobson says:

    Hi Andrew,

    My wife and I are Canadian expats currently living/workign in Brunei. We visited DBS Vickers in Singapore last week and were turned down for bank account despite wanting to deposit low 6 figure sum and around 5k/month. This was suprising for us as the Brunei dollar is pegged to the Singapore dollar and the 2 countries enjoy close banking ties so we were told. No way of knowing the reason as DBS will not divulge reasons. We then tried TD in Luxembourg but they have Brunei on the list of countries they will not do business with…along with UAE, Argentina, etc. Saxo has not returned our calls or emails so I’m assuming they’re a no go as well. I then tried opening an account in Canada w/Royal or TD only to be told that Canadian banks no longer allow expats to open brokerage accounts. There’s absolutely nothing sinister on our end to be sure. So, any ideas on who to go to next?

    Thanks,
    Chris

    • Hi Chris,

      I’m really sorry to hear about this. There is one brokerage that I’m quite certain will take you: Interactive Brokers. Give them a shout. https://www.interactivebrokers.com/en/home.php Then please let me know how it goes.

      Cheers,
      Andrew

      • Chris Dobson says:

        Will do..and thanks for the very quick reply.

        Cheers,
        Chris

      • Chris Dobson says:

        Hi again AndrewFYI, another piece of the puzzle just fell into place. I just received this notice from SAXO about applying for an investment account. If this is indeed universal for Canadian Expats then I have never seen a more clear cut example of “The rich get richer and the poor get poorer” How are honest hard working expats supposed to save for retirement if these ridiculous barriers are in place? I’m guessing this is also why DBS denied us.

        “Dear Mr. Dobson,

        Thank you for your interest in pursuing an account opening with Saxo Capital Markets. Definitely you can set up a joint account with us with verification done from a notary public in Brunei, since you are located there.

        However, since you mention that both of you hold a Canadian passport, both of you would have to qualify to be Accredited Investors as stipulated by the Canadian government. Please find in this email an attached file (Schedule A). Do revert to (k) or (l) on ‘Schedule A’ for the definition of Accredited Investor. In summary, both you and your spouse would qualify to be an Accredited Investor if:
        (k) net income before tax combined with spouse to exceed $300,000 in each of the 2 most recent calendar years or;
        (l) collectively with spouse to have net assets at least $5,000,000

        If you would qualify to be an Accredited Investor, please advise your mobile number so we can speak briefly over the phone so that I can walk you through the whole account opening process and better understand your trading needs.”

  122. Chris,

    I understand that this is frustrating. You will be able to open an account with Interactive Brokers without such hassles.

    Andrew

  123. Jen says:

    Hi Andrew

    I have a Saxo portfolio-kept investing even thu returns were poor last yr and tried to treat it like the sale it was. Saxo does not offer index funds–but td direct international does and I want to also invest in an index fund (I know ETFs and index funds are similar but I like the easiness (for me) of an index fund that will reinvest the dividends and for which I can do a monthly debit order). I have been going thru their index funds and do not see which is a good one for internional stock d USA 500–there are 900. Can you recommend 2 funds out of those 900–one that covers the total international stock mkt and one of the us? I looked at their recommended funds but did not see an international stock one. It is confusing.

    • Hi Jen,

      I’ll do some digging on your behalf. They do offer a global stock market index (which is all you would need for stock exposure) and a S&P 500 index, as well as some emerging market indexes, but if their website is correct, the minimum amount you can invest in the global index is 100,000 Euros. I’ll contact the firm and write about this soon. They might have high minimums on all of them.

      Cheers
      Andrew

    • Hi Jen,

      I heard back from TD. They don’t offer automated purchases, so you would have to buy their index funds each month, online, much as you would with ETFs. To answer your question fully, and so others will benefit, I will post an article about it on my blog, later this evening.

      Cheers,
      Andrew

      • Jen says:

        Thanks Andrew,I appreciate your help. As an expat you know how hard it is trying to find a platform to buy from-td direct uk has, vanguard lfestyle funds which I really like, but I cannot open with them as I am not an eu resident. Will wait for your article. Tx.

        • Rudolf says:

          Jen.

          you can buy from TD direct international as long as your not an American citizen.

          • Jen says:

            Hi Rudolf-the vanguard lifestyle funds are not listed on the td direct international website on their available 900+ funds.

  124. Mark says:

    Hi Andrew,

    Have read both your books and find them very helpful. I do have a question regarding the repeated warning to avoid US estate taxes upon death by limiting personnel investments to no more than USD$60k in USA index’s, etc.

    If a foreign based Family Investment Trust (UK, Aust, NZ, Spore) exceeded the current USD$60k would they not be shielded during the life of the trust from the long arm of US estate taxes?

    Thanks, Mark

    • I don’t believe it would be sheltered, Mark, if the investments were purchased from a United States exchange, even via a foreign brokerage. Why take the risk? Ensure that the assets are listed on a non U.S. exchange.

      Cheers,
      Andrew

  125. Eric says:

    Hi Andrew,
    I just read Millionaire Teacher and I’m really excited to start investing in my vanguard account. I definitely consider myself a “couch potato” investor and wanted to know if there are any downfalls to using the Vanguard Target date funds? I’m 30 and have invested a little in the past but am planning on ramping up my retirement contributions now. I like that I don’t have to think much about the target date, or rebalance anything. However, I’m just curious if the rate of return is that much better if I invest in all individual Vanguard funds?

    Any insights would be greatly appreciated.

    Thanks for all your help!

  126. Garry says:

    Hi Andrew,
    Read your first book – absolutely fantastic – going to start your second shortly….. Unfortunately, I wish I had found this two years ago! Now working overseas for the past two years, I have opened a Friends Provident International 25yr pension scheme. I am quickly realising that this product is NOT as good as first imagined. The charges are rather eye watering to say the least!
    Do you have any advice in how to get out of this product? Their surrender charges are ridiculous……..

    thanks Garry

  127. Heather Wendell says:

    Hi Andrew,

    What a relief to find your website! My husband and I are U.S. expat merchant mariners and have been struggling for years through bank account closures and the inability to find somewhere to invest. For the past four years we’ve been without a home address/utility bill with our names on it which compounds our predicament. Your website is a wealth of helpful information and I can’t wait to start reading your Global Expatriate’s Guide to Investing. FYI, the State Department Federal Credit Union in the U.S. totally came to our rescue after our last bank account closures last month. AND they do not charge for converting funds to a foreign denomination before wire transferring. Could be a helpful bit of info for some of your U.S. readers. My current quest is to locate a bank where we might be able to open an account to receive GBP. Any thoughts?

    • Hi Heather,

      If you’re looking for an investment brokerage to build a portfolio of low cost index funds, you will be able to use TD Direct International or Saxo Capital Markets. In both cases, you could send GBP.

      Cheers,
      Andrew

  128. Nuno Brandao says:

    Dear Andrew,

    Congratulations for your great book about expat investment, finally someone could provide a so much practical and useful info about how to do it yourselves.

    My questions are as follows:

    I am an European currently living/working in Macau, Macau dollar is indexed to Hong Kong dollar with a conversion rate close to 1, I have a brokerage account offered by my local bank that provides access only to Australia, US, Hong Kong and Asia stock market , through the local brokers I have no access to the European stock market however I am actually considering retiring in Asia (Hong Kong or Macau) so i am considering choosing between two portfolios, avoiding as you advised in your book the US stock market:

    #1. Table 18.1, pag.247, Australian Couch portfolio;

    #2. Custom made portfolio with Hong Kong bond and tracker funds ETFs plus the two US and All-world ETFs bought through the Australian stock market of the mentioned Table18.1;

    I am a little bit hesitant on which to choose, being an European expat in Asia, which of these two could I benefit the most, will i be able to get a min of 6/7% averaged per year? I am loosing any advantage by being European but concentrating my funds in Asia?

    Many thanks in advance.

    Cheers,
    Nuno

  129. Rick Dennis says:

    Hi Andrew, Great books! I just finished your latest book… well not really finished as I am continuously flipping through it. I actually bought Millionaire Teacher when you came to the Tanjong Katong CIS campus a few years ago to give a talk.

    I was just wondering what are the exact ETFs you are currently investing in? I have looked through your website but cannot find your current portfolio. I am Canadian and living in Singapore, but unsure if I will settle in Canada. It will be my first time investing with ETFs and I am so nervous about picking the wrong ones. Same thing goes for picking the right brokerage.

    I know you are incredibly busy and may not be able to get back to me. Best wishes and can’t wait for the next book!

    Kind regards,
    Rick

    • Hi Rick,

      There’s really no such thing as picking the wrong ETFs..if you stick to the model portfolios that are in my book, The Global Expatriate’s Guide To Investing. You need a low cost Canadian ETF, and a global stock ETF plus a Canadian bond ETF. Or, you could buy a Canadian stock ETF, a U.S. ETF, a first world international ETF and a sliver of an emerging market ETF. Both strategies would contain exactly the same stocks. None of the ETFs that I listed under my book’s model portfolio section are currency hedged. Make sure that none of yours are either.

      If you really think that I might own some kind of secret sauce (I don’t) here’s my portfolio, which trades on the TSX

      40% VSB (this won’t be the same for you, if your age/risk tolerance is different to mine)
      20% HXT (newly added. I didn’t have a Canadian stock component until very recently)
      10% HXS I recently sold $500K to buy an apartment in Victoria, leaving me with 10%
      20% VDU (International stock index)
      10% VEE (Emerging market index) This, like the Canadian stock index, is a new addition

      I didn’t used to own a Canadian stock index because I won’t likely ever repatriate to Canada. But as you can see in one of my latest AssetBuilder articles, I believe Canadian stocks may offer the best deal in the world right now. This was my signal to invest like other Canadians. I would say much the same thing for my new emerging market index. I didn’t used to own one. Now I do…to provide full diversification, plus the emerging market index is extremely cheap.

      The model above is good. But please see my book on the risk profiles for the Horizon products. Also, note that this portfolio’s percentages were a result of a real time sale that I made when choosing to sell $500 K of my U.S. stock index to buy an apartment in Victoria.

      Do I have the secret sauce? Nope. Any of the model portfolios and ETFs could replace what I own above. I would be equally happy. So relax. And build a diversified portfolio of low cost ETFs. Here’s link: http://bit.ly/globalexpat
      Cheers,
      Andrew

      • David C. says:

        Hi Andrew,

        Seeing your portfolio was exactly what I was looking for.
        By the way, any particular reason for why you chose to go with VSB over HBB as your choice of bond?

        • Hi David,

          I have not traded VSB for HBB because of the extra risk associated with swap traded ETFs. I don’t want all of my money in such products 🙂

          Cheers,
          Andrew

  130. ???Yi-Ting) says:

    Hi Andrew,
    I am a college student in Taiwan.
    Since read your book,I have started to invest.I want to invest 20% in the bond,80% in the index stock.But I got a huge promble,In Taiwain ,here’s no“ Bond index stocks”,and I can not burden the bond’s fee,it’s too high.What should I do?

  131. Nuno Brandao says:

    Dear Andrew,

    My apologies in advance for repeating my post as above, but after reading your book i am really in need for one clarification hint to move forward with my hesitant decision, can you help me?

    I am an European currently living/working in Macau, Macau dollar is indexed to Hong Kong dollar with a conversion rate close to 1, I have a brokerage account offered by my local bank that provides access only to Australia, US, Hong Kong and Asia stock market , through the local brokers I have no access to the European stock market however I am actually considering retiring in Asia (Hong Kong or Macau) so i am considering choosing between two portfolios, avoiding as you advised in your book the US stock market:

    #1 Portfolio: Table 18.1, pag.247, Australian Couch portfolio:

    30% VGB.AX Vanguard Australian Bond Index
    35% VAS.AX Vanguard Australian Shares
    17.5% VTS.AX – Vanguard US Total Market;
    17.5% VEU.AX Vanguard FTSE All World ex US Index Fund Investor Shares;

    #2. Portfolio: Custom made portfolio with Hong Kong bond and tracker funds ETFs plus the two US and All-world ETFs bought through the Australian stock market, and mentioned on the Table18.1 (as per below):

    35% 2819.HK – ABF Hong Kong Bond Index;
    15% 2800.HK – TRACKER FUND;
    25% VTS.AX – Vanguard US Total Market;
    25% VEU.AX Vanguard FTSE All World ex US Index Fund Investor Shares;

    I am a little bit hesitant on which to choose, being an European expat in Asia, which of these two could I benefit the most, will i be able to get a min of 6/7% averaged per year? I am loosing any advantage by being European but concentrating my investment funds in Asia?

    Congratulations for your great book about expat investment, finally someone could provide a so much practical and useful info about how to do it yourselves.

    Many thanks in advance.

    Cheers,
    Nuno

    • Hi Nuno,

      Portfolio #2 would be a much better option. The first portfolio has 65% of it pegged to Australia. That’s not a smart move for a non-Australian.

      But let me offer a suggestion to tweak portfolio #2. Don’t put so much weight in Hong Kong’s bond index. Split the proceeds between Hong Kong’s bond index and an international bond index. Here’s one that owns global corporate bonds: https://www.blackrock.com/au/individual/products/275246/ishares-global-corporate-bond-aud-hedged-etf-fund

      It trades on the Australian market. If there were one that contained global country bonds, it would have very slightly less risk (but also lower performance). As of this date, no such product exists. This one should do just fine. Hong Kong is a very small market. That’s why I recommend more diversification with the bonds.

      Then rebalance your portfolio once a year. And if you have two minutes, and you feel that my expat book was helpful, would you mind posting a short review on Amazon? Here’s link: http://bit.ly/globalexpat
      Thanks!
      Andrew

      • Nuno Brandao says:

        A great book definitely, my pleasure to contribute.

        Many thanks Andrew for your help.

        Best regards,
        Nuno

  132. Raven says:

    Hey Andrew,

    You said that for singaporeans, we should buy bond index which is A35. I also note that A35 could be bought with CPF (if certain requirements were met), however, i also noted that CPF has currently a prevailing interest rate of up to 3.5% for the ordinary account and 5% for both the special and medisave account, and that money would be used later on at 55, for withdrawl and at 65 for retirement sum (not too sure about this though). So i was wondering, taking opporunity cost in mind, if using CPF to buy bonds is the best choice made or not.

    Hope you could advice,
    Raven

    • Hi Raven,

      For Singaporeans, I suggest not buying bonds at all. Your CPF constitutes a bond allocation already. You could simply invest in two ETFs. A global stock ETF and a Singapore stock ETF.

      Cheers,
      Andrew

  133. Raj says:

    Andrew,

    When you recently purchased your new apartment, did you pay cash for it or get a mortgage? I assume you paid cash. In which case, do you consider the value of property in you overall asset allocation of 60/40 or treat as being completely separate from your asset allocation?

  134. CHRIS COLES says:

    Hi,

    Thanks again for taking the time to come to Muscat this week – really, really useful.

    My wife and I both have a pension with FP, luckily mine’s only 3 payments old, two of which are still processing so I may get them back! (30 days grace period from stat date BTW).

    My wife’s is 30 months old: $16k put in, now worth 14k with a surrender value of 9………just trying to read up and type in the numbers now!

    Any advice?

    Much appreciated!

  135. Ian says:

    Andrew,

    On the flip side of this, if someone has a mortgage that they are paying for, should they consider the mortgage as a kind of negative bond component in their asset allocation until it is paid off?

    • Hi Ian,

      That depends on your risk tolerance. If you pay off a mortgage that charges 4% per year in interest, that’s a 4% guaranteed after tax return. Nobody in the world can GUARANTEE a return that’s that good.

      Cheers,
      Andrew

  136. CHRIS COLES says:

    Hi,

    Thanks again for taking the time to come to Muscat this week. Very much appreciated! Pretty happy my wife and I realised earlier, rather than later.

    Reading up on what to do; my policy is only 3 payments old so I have surrendered. 2 of my payments are still on hold, so I may get them back inshallah. I’m not obliged to continue for 18 months – FYI I would have got it all back had it been within 30 days (Friends Provident).

    My wife’s pension is 30 months old; $16k gone in, worth 14k, 9k surrender valuation. I’m gonna read your ‘making best’ article this weekend but I’m thinking take the money and run.

    Thanks again!

    • Thanks Chris,

      Fortunately, you now have a really good option to put a plan in place for your future. If you have any questions, feel free to ask.

      Cheers,
      Andrew

      • CHRIS COLES says:

        Looks like based on those numbers, my wife surrenders and invests her 9k surrender value elsewhere. Would you agree?

        Out of curiosity, (I can’t find any information on it anywhere else) what commission to the salesmen get from each FP pension they sell?!

        • Chris,

          I’ve taken this from my book, The Global Expatriate’s Guide To Investing.

          The Rip-Offers
          Certified Financial Planner, Tony Noto, was once hired by a firm to sell offshore pensions to expatriates. But the more he learned about them, the sketchier they appeared. After two weeks of dissecting these products, he quit and established his own firm to build indexed portfolios for clients.
          “These offshore pensions are popularly sold,” he says, “because they offer lucrative up front commissions, often equivalent to the total sum of an investor’s deposit during their first year of the scheme. Those convincing you to invest $15,000 per year for 25 years, for example, often reap an up front commission of roughly $15,000 from the insurance company, shortly after the contractual ink dries. There is no question of who ultimately pays that bill – the investor.” 3
          Benjamin Robertson revealed the commissions paid to brokers in his South China Morning Post’s September, 2013 article, Investment-linked Insurance Schemes a Trap for Unwary Investors. On a 20-year policy, a broker convincing a client to add $1000 per month ($12,000 per year) would receive an upfront commission of $10,800, split between the broker and his employer.
          On a 25-year policy, the commission would be higher. It’s based on a formula multiplying the number of years of the policy x 12 (months in the year)
          x monthly dollar contribution x 4.2 percent. As such, a 25-year policy where the investor adds $1000 per month would earn a brokerage commission of $12,600. 4
          Recognizing a winning lottery ticket when they see it, many expatriate advisors flog the products exclusively. To a hammer, everything looks like a nail. Consequently these expensive, inflexible platforms have spread like pandemics among global expats.

    • toony says:

      Lucky break Chris!
      Chance to get out now with only a small loss! Imagine what would happen if you weren’t at the talk and only realise 5-10 years from now!

      Imagine how much money they would would have bleed from you/wife and the many extra years you have to work before you could retire!

      We are talking $100k+. I think you owe Andrew a beer or two! (or perhaps a nice review on Amazon for his book 😉

  137. Joshua says:

    Hello Mr. Hallam,

    Do you still considering emerging markets a worthwhile investment? I’m in Canada so to add them I would have to purchase a separate ETF (VEE or XEC). If so, would a five percent equity allocation appear to be just right or a touch too risky? Or in the long run, would a 5% allocation to anything make much of a difference at all?

    Thanks again for the great information.

    Josh

  138. CC says:

    Hi Andrew,

    First and foremost, thank you 🙂 Bought your bookS, read them, feeling confident and happy to have avoided 2 silver tongued players – I know which type of investment I am going for – all ready but…. I have realized that DBS vickers have massive commissions for access to the UK market and I am at loss… looking at your posts (21st APril) I have realised that your recco is now basically either interactive brokers or Saxo. Could you please advise based in Singapore what would be the best knowing that I am more looking for an investment like pg274 of your latest book. The more I read the details of either Saxo (minimum + stamp duty + etc…) I feel I am back in that obscure ILASs world where every little note will make a huge difference. Opening an account with Interactive brookers would I still be able to trade only outside the US but with 2 currency conversion – SGD to USD then to GBP? If you could shed some lights for me, that would be really appreciated. Looking at 2/3K monthly basis. Thanks a lot in advance

    • Hi CC,

      Best be aware that the words “massive commissions” do not apply to any of the brokerages I listed in my book. None carry anything like the 4%+ annual account fees that you would pay with an offshore pension. Rest assured, you will have a cheap option, regardless of what you choose. You have not listed your nationality, which makes a recommendation somewhat tough. I don’t have my book with me, so I’m not sure what nationality pg 274 applies to. If you are British, you could use Standard Chartered’s brokerage. If you are Canadian, consider TD Direct International. TD’s brokerage is great.
      Actually, you could also use TD Direct Asia if you live in Singapore and you are Canadian.

      Always remember, a commission to make a purchase is always peanuts, compared to a 4%+ ongoing account fee. It’s like comparing an ant (maybe one with a full belly) to a fully grown elephant.

      Cheers,
      Andrew

  139. CC says:

    Thanks a lot for your quick reply Andrew! I am French- appreciate it! CC

  140. Michele says:

    Hi Andrew, I enjoyed your book for Global expatriates and found it very informative, my question for you and other expats out there is how do you deal with all the paperwork that is required when investing. We are Australians living in China and receiving mail here can be a bit hit and miss, so paperwork for reinvestment etc is currently handled by our financial advisor. I am concerned that if we were to take over the day to day running mail would go missing. We currently hold direct investments, if we were to changeover to index funds would there be as much paperwork? Also what do other Aussie expats do in relation to tax returns, as again our advisor handles all of that.

    • Hi Michele,

      I use TD Direct International and have opted not to receive any hard copy mail from them. I receive any and all notifications via email.

      Cheers,
      Andrew

  141. Vefffa says:

    Hi Andrew,

    Finished reading your book, it is one of a kind for Expats! I am a Canadian expat currently in HK. Previously was in SG and Canada. I have uninvested SGD sitting at a Singapore bank, HKD in Hong Kong based bank, CAD (in TSRA) and USD in Canadian bank account. I am think it will be costly to open brokerage accounts in 3 countries. Canada, HK and SG. Not sure whether I should convert my SGD/HK/CAD/USD in one currency to create a portfolio in one country or keep multiple currencies and create portfolios in different currencies? I am 32 and unlikely to retire in Canada. Therefore, can’t decide what index to invest in. Any comments?

  142. Steve says:

    Hi,
    In the expat book you have some calculations comparing different brokerages (e.g. Saxo, DBS, TDI). Would it be possible to make the excel available for this?

    I’m currently comparing myself and wanted to run the numbers. I’ve set up my own template but do not know the assumptions you made on commissions (mine look too low).

    If possible to share that would be great or if you could walk me through the commission calc.

    • Steve,

      Since that book was written, Saxo has increased their fees; TD Direct decreased theirs. They are both still very cheap. But TD Direct International is the one to go with. I wrote about that here: https://andrewhallam.com/2016/01/brokerage-battle-saxo-capital-markets-versus-td-direct-international/

      Cheers,
      Andrew

      • Steve says:

        Andrew,
        First thank you for such quick responses to mine and everyone’s questions. I’m sure I speak for us all!

        I’ve been comparing IB, Saxo, TDI and DBS.

        Saxo : My main issue was the ‘custody fee’ which basically trabslates into an account fee. They also have larg(ish) exit fees and none activity fees.

        IB : Looks overall pretty good except (as mentioned in the book) the US tax implications.

        TDI : Exchange rate was my main concern but as you mention in the article linked this could be done elsewhere. Not sure if they charge for Dividend collection.

        DBS : No online acess to EU markets is an issue. Expensive Annual (custody) fees.

        Would you be willing to check my calculations? As mentioned I don’t understand your commissions calculations in the book.

        Thanks
        Steve

        • Hi Steve,

          TD Direct International does not charge a fee for dividend collection. You might also find this useful. It shows how to reduce the TD Direct International currency bite: https://andrewhallam.com/2016/03/how-to-reduce-the-currency-bite-with-td-direct-international/

          I have accounts with each of the three brokerages you mentioned. As someone writing about them, I felt it was important to expose myself to all three. By far, the easiest platform is TD Direct International’s. By far, the best and most knowledgable service (for questions about the platform) is TD Direct International. In fact, it was the rep at TD who contacted me to show my readers how to reduce the currency bite in the post I linked above.

          If you do get a chance to review my book on Amazon, I would love that! Thanks very much Steve: Here’s link: http://bit.ly/globalexpat

          Cheers,
          Andrew

          • Steve says:

            Thanks Andrew that is most helpful. I’ve also found their email support to be very fast/helpful.

            Table 13.1 in the book has $360 the cost for trading with TDI. Understanding that the commission rate is now different, should I assume that you used $30/p.transaction as the cost for trading $1000 per month?

            Thanks
            Steve

          • That’s correct Steve. And they have since lowered that. I believe that the trading cost (for most markets) is a flat 14 Euros, or something close to that.

            Cheers,
            Andrew

  143. Cherry says:

    Hi Andrew

    I’ve just finished reading Millionaire Teacher and I’m now ploughing through the Global Expatriate Guide – fantastic books, easy to read. I’m a 44-year-old female teacher in Hong Kong and have no pension as such. I have the following options, what would you recommend:

    1) Pay my remaining National Insurance (NI) contributions into the UK State Pension (I have 11 years’ worth of voluntary payments to make, but I have enough cash to pay as a lump sum now).

    2) Start investing into a Recognised Overseas Pension Scheme through a company in Hong Kong (Quartermain), listed on the UK Government website (https://www.gov.uk/government/publications/list-of-qualifying-recognised-overseas-pension-schemes-qrops/list-of-recognised-overseas-pension-schemes-notifications). I can’t find much information as to whether these are good products or not.

    3) Start paying into this Forever Love savings/retirement plan scheme by AIA Insurance company (http://www.aia.com.hk/en/our-products/savings/forever-love-coupon-plan-3.html). I’m not sure about this one…

    4) Stock Market – Index tracking portfolio as you suggest – definitely want to do that.

    Would I be better off just doing option 1 and 4 and disregarding options 2 and 3, or is there some merit in those schemes too?

  144. Thomas says:

    Hi Andrew,

    I’m a Brit who has been living in Malaysia for years and my partner (a teacher as well) recently passed me the books to read. As financial amateurs I’ve met a few Financial Advisers and always being put off by the sales aspect – after reading your book I am so thankful I was.

    I’ve looked into opening a Vanguard account through the .co.uk site and it seems to only give us mutual fund option account or ETF account – following this there are so many fund options to select from it’s all a bit much. Would you be able to recommend the best account for us to open and further reading on how an income fund is different from an accumulation fund? I’m hoping to get an investment plan in place pronto!

    Many Thanks,
    Thomas

    • Hi Thomas,

      I am glad you were able to sidestep the financial advisors in Malaysia. Based on your question, it sounds like you read my first book, Millionaire Teacher. My second book should answer every question you will have. It’s very specific to your circumstance. Here’s link: http://bit.ly/globalexpat

      Cheers,
      Andrew

      • Thomas says:

        Hi Andrew,

        Thank you for such a prompt reply – I’m currently starting the second book. ( I promised myself I would finish it by Sunday).

        From my interaction with Vanguard UK they have advised me they cannot deal with a British national based in Malaysia and a lot of the companies I’m looking at are seeking a large upfront investment which I just don’t have – would you be able to recommend a company I can use to invest with on a monthly basis? Or do I need to first focus on saving a lump sum?

        Thank you for the reply – I really appreciate it. Have you considered opening a Vbulletin forum?

        Thanks & Regards,
        Thomas

        • Hi Thomas,

          The second book gives expat British investors instructions on what platforms they can use. Vanguard UK is not one of them.

          Cheers,
          Andrew

  145. Nuno Brandao says:

    Dear Andrew,

    Thanks again for replying to my previous question post of April 20, 2016.

    Before i make my final portfolio decision, i decided to dig a bit more on the “Permanent Portfolio” strategy, which average return rates seem to be a bit higher then those from the “Coach Portfolio”, although i dont know you trustful is the information i found on the web, i decided to give it a try and mounted my possible Permanent Portfolio as it follows (I am an european expat living in Macau, with my current bank broker, I am limited to US, Australia, HK and all other Asian stock markets):

    12.5% 2819.HK – ABF Hong Kong Bond Index (100 units min buying lot size);
    12.5% IHCB.AX – iShares Global Corporate Bond ETF;
    8.33% 2800.HK – TRACKER FUND (500 units min buying lot size);
    8.33% VTS.AX – Vanguard US Total Market;
    8.33% VEU.AX – Vanguard FTSE All World ex US Index Fund Investor Shares;
    25% QAU.AX – BetaShares Gold Bullin ETF;
    25% CASH

    1. Can you give your feedback if i am pointing in the right direction towards an efficient Permanent Porfolio?

    2. Also i would like to ask your opinion on any ETFs i can use to replace the 2800.HK and 2819.HK from the Australian stock market, these ETFs have a min lot size buy which really makes the toal initial investment amount quite high.

    Many thanks Andrew.
    Nuno

    • Hi Nuno,

      I’m glad you have found a low cost investment option. However, your selection of the Permanent Portfolio should not be based on “better” returns that you see posted. As I mentioned in my book, the winning strategy during one time period will almost always not be the winning strategy during the next. Here’s link: http://bit.ly/globalexpat

      This portfolio is built to be less volatile. It’s not meant to beat a regular Couch Potato portfolio. Over time, I don’t think it will. Over a 30 year period, results will likely be similar.

      One suggestion. If you build this portfolio (which is based on an excellent low volatility premise) why bother with the Hong Kong index at all? It seems an awful lot of money to invest in Hong Kong bonds, especially considering the fact that you are European. Instead, you would have more diversification (and it makes more sense) if that 12.5% allocation were invested in European bonds.

      Cheers,
      Andrew

      • Nuno Brandao says:

        Dear Andrew,

        Many thanks for your reply. I understand your thoughts, but the problem is that through my current bank broker, I can only access to US, HK, Australian and all other Asian stock markets which unables my access to the European stock market.

        Can I ask if you have some better suggestion to replace my 12.5% Hong Kong bond allocation with something European (ETF) that I can buy from the Australian stock market?

        Many thanks Andrew.
        Nuno

  146. Nuno Brandao says:

    I followed your suggestion, many thanks Andrew for your help, looking forward for a new book from you.

    All the best!
    Nuno

  147. Vaughan says:

    Hi Andrew,

    Just finished Millionaire Teacher. I can’t believe how ‘easy’ the book was to read. As a novice, it was great to get some straight forward info and be able to instantly see where to go.

    I do have a couple of questions though that I hope you can answer for me. As a Canadian, overseas teacher for the long term future, I have decided the best plan for me would be TD E-series. Any help would be appreciated. I have gotten my TD info from the E-Series website: http://www.tdcanadatrust.com/products-services/investing/mutual-funds/td-eseries-funds.jsp#what-does-td-offer

    1. Since I am saving for retirement, can I put all my savings in RRSPs while using the E-series? This way I don’t pay taxes on earning right?
    2. I get paid in US$, and I notice some E-series funds say (US$). I assume that means that I can invest with my US money?
    3. Looking at the E-Series funds as a 34 year old, I’m looking at TD Cdn Bond Index, TD Cdn Index and either TD Dow Jones (US$) or TD US Index (US$) in the ratio of 30:35:35%. What do you think?
    4. In your book you also mention an international index, but historical data of TD international indexes seem weak. If I was to add one and go 25:25:25:25, which one would you suggest? Or should I stick with #3?
    5. My last question is about a strategy you employ in the book which I totally understand, buying when the market in tanking (’01, ’08). How do you know when it is low? What resource do you use to decide the market is falling and stocks are ‘cheap’? Would I just follow the TD website fund analysis page?

    Thanks for the insight. Next up is book 2, Global Expats Guide to Investing!

    • Hi Vaughan,

      That second book will help a great deal. As an expat, the options above are not available to you.

      Cheers,
      Andrew

      • Diego says:

        Hi Andrew,

        First of all I think you’re books are incredibly easy to read for someone that had no idea about investment and finances. I’ve read the Millionaire Teacher and the expatriat’s guide to investing – I’m a teacher too and I am based in Singapore, although not for long,…and I was researching into opening an investment account with DBS Vickers or Saxo. I have two questions:

        1) I am European but my savings in Singapore are in SGD and with DBS. When opening either account, with Vickers I will use SGD as the base currency but if I open it with Saxo, I am not sure what to open in, SGD, EUR, USD? I would eventually retire in Europe but I am not too sure about the EUR buoyancy as my currency of choice for the investment account. Given my situation which currency would you choose as the base one for opening my account?

        2) I have seen your comparisons of the two company’s in your book and they seem pretty much the same thing. The only thing I found in terms of fees is that DBS has custodian fees:” DBS Vickers will charge SGD 2 per stock per month and capped at SGD 150 per quarter. We will waive the custodian fee if there are at least 2 transactions per month or 6 transactions per quarter”. To be honest, I am looking at building a Coach Potatoe portfolio , so I would be charged 600SGD for being inactive… am I interpreting it right? I am more inclined to use Vickers as I would have both Savings and investment account in one place. That would cut cost on transferring money from your savings account to the investment account, right?

        Thank you so much

        • Diego,

          There should be no “base currency” for any account you choose. As mentioned in my expat book, the currencies that the ETFs are listed in are hardly relevant. You are really investing in the underlying currencies of the ETFs you hold. For example, assume I bought a European stock index listed in USD. Is that a USD investment, because I appeared to convert money to USD before making the purchase? No. That investment would have nothing to do with the USD, even though it was priced as such. It would be invested entirely in Euros. Imagine the European index staying flat for a year, with the USD falling 20%. The index would post a return of 20% for the year (if it were listed in USD) even though the European index was flat for the year. Did you really make 20%? Nope. Only when it’s compared to the USD. Convert back to Euros at the end of the year, and you won’t see a 20% gain at all. You could choose to have your ETFs listed in a given currency if you are either paid in that currency or if you plan to sell that currency in the future. Why? Because it will save you a tiny sum in currency transaction costs. Tiny. Like 0.5% to 1% of what you sell. This isn’t an ongoing cost, just a single transaction cost to sell and convert the currency itself. As far as brokerages go, I like TD Direct International. They have lowered fees. https://andrewhallam.com/2016/01/brokerage-battle-saxo-capital-markets-versus-td-direct-international/

      • Vaughan says:

        Hi Andrew,

        I’ve now completed your second book. Again great insight for me and each chapter had me wanting to get things rolling.

        I do have a couple followup questions though.

        To answer most of my questions because I don’t want to keep inconveniencing you here with trivial questions, I was looking to use your suggested fee-only advisor in Canada. After emailing them, they are not taking any more clients right now. Can you suggest any other Toronto area based advisors that specialize in expats? Searching online doesn’t seem to be leading me to recommended ones.

        I can’t invest at TD Direct Investing International as I work in Vietnam, my second choice was going to be DBS in Singapore. Does this make sense or would you suggest a different company? Maybe something based out of Canada where I’m from?

  148. Katie Leese says:

    Hi Andrew,

    Thanks to your books we have set up our Saxo account and are ready to go. We are also trying to convince our whole school in the Philippines to do the same! We are UK citizens and have chosen:

    1. VWRL

    2. IGLS over VGOV – we think! Due to better returns even though a slightly higher exchange ratio.

    3. Then we aren’t sure about the final choice…VUKE or VMID as the VMID is new since your books.

    Which do you think is best?

    Thanks,

    Katie

    • Hi Katie,

      Congratulations on setting up a low cost account. I prefer IGLS, but not for the reasons you might think. IGLS is a shorter term government bond ETF. As mentioned in my book, bond indexes holding shorter term bonds are preferable. VGOV holds slightly longer term bonds. But something you said concerns me a lot. You based your decision on “better returns.” That means you are looking through the rear-view window. That’s a dangerous practice, and none of your investment decisions should ever be based on this practice. It’s a sure way to get burned.

      Fortunately, your investment selection is solid. But over the next 5 years (or 1 year, or 10 years) you will always find an ETF (bond or otherwise) that beats your ETF’s performances. Whatever you do, don’t switch. Yesterday’s winners rarely keep winning. More than likely, you would buy tomorrow’s losers if you switch.

      As for stocks, VMID tracks the FTSE 250. VUKE tracks the FTSE 100. Based on what you have learned, which fund provides more diversification and broader exposure to the UK market? I would like you to tell me. It’s your little test. I’m forever a teacher. Please get back to me with your answer.

      Cheers,
      Andrew

    • Hi Katie,

      I just want to add that I’m thrilled by what you’re doing with your fellow teachers. Thank you!!

      Andrew

  149. raven says:

    Hey Andrew,

    Comparing VWRD and IWDA, (VWRD 0.25 TER, has EM component, doesn’t reinvest dividends, IDWA 0.20 TER, no EM component, reinvest dividends automatically) which do you think is better ?

    One more question. is it feasible to hold two global index, one that covers global market (may or may not have EM component) and another that covers only the US market?

    Please advice,
    Raven

    • Hi Raven,

      An ETF that holds only the U.S. market wouldn’t be considered global. It would be considered a U.S. ETF.

      As for the reinvestment of dividends, that comes with a synthetic or swap based ETF. As I mentioned in my book, such a product doesn’t hold physical shares, so the risk is higher.

      Cheers,
      Andrew

      • moortomas says:

        I am sorry Andrew,but you are wrong.
        Not all ETFs that have reinvest ing income/Dividents are synthetic or swap based ETF.
        For example :
        iShares NASDAQ 100 UCITS ETF CNDX,Reinvesting income,product structure-Physical
        iShares MSCI USA small cap UCITS ETF (CUSS),reinvesting income,product structure-Physical
        iShares Core S&P 500 UCITS ETF(CSPX),re-investing income,product structure-Physical
        ……………………………………..

        • Not all, but most. Thanks for showing some examples.

          Cheers,
          Andrew

        • Moortomas,

          I should ask this next question so I can learn from you. How do you know that iShares takes all of these dividends and reinvests in new shares? I can’t see that on the prospectuses. To my knowledge, some brokerages will reinvest physical dividends for free. But I wasn’t aware that iShares itself would do that with a physical product. Can you help? Can you show me how you know? This is highly unusual, but extremely cool if it’s true. And in this case, how would the dividends be taxed? Would they be taxed as per usual, with physical dividend distributions?

          Thanks,
          Andrew

          https://www.ishares.com/uk/individual/en/products/253741/ishares-nasdaq-100-ucits-etf

          • moortomas says:

            I have my propositions,but i prefer to be 100 % correct.
            For this reason,i sent a massage to ishares and i hope in the next days,i will have the answers.
            P.S
            You learn the others, and you are ready to learn from them also-This mentality/mind set is awesome -keep going.
            And thank you again for your great site and your dedications here-much appreciated.

          • moortomas says:

            Hello again.
            It seems that there is no tax at all-here is the official answer:
            “Dear Mr. Moor,

            Many thanks for your enquiry and the positive feedback.

            Accumulating funds do not pay tax on the distributions that are re-invested back into the ETFs.

            Kind regards,”
            I think that you can update yourt portfolios with these with re-investing dividents.
            Cheers

          • With the physical shares, dividends aren’t reinvested back into the ETFs Moortomas. This is only the case with synthetic, swap based products.

            Cheers,
            Andrew

          • moortomas says:

            As you saw,they are Physical products(not Swapped) in the description and automatically re-invested..
            You mean that ishares are not saying the truth and they are not physical but swapped products ?

        • Moortomas,

          It does look like you are right. I wonder if the tax benefit is enough to offset the slightly higher expense ratio. If the dividend yield is 1.5% and you pay dividend tax of 15% on a Canadian domiciled physical non reinvesting ETF, the drag on returns would be .225% per year. The ETF that reinvests dividends automatically costs 0.33% per year. That’s 0.18% more than my Vanguard US ETF charges, for the entire U.S. market (which is more diversified). The product you found has great potential. It comes out slightly ahead–although the total U.S. market index is more diversified.

          Cheers,
          Andrew

          • moortomas says:

            You can make a special article about re-investing ETFs-advantages and disadvantages vs normal ETFs-to see in the long term,is there any big difference(no taxes on dividents but slightly more expensive) ?
            P.S
            I picked up them,not because they are re-investing(this is a benefit),but because i was looking for specific products,that only this ETFs offers.
            P.S
            By the way,i made a demo account and for a month,i have a 4 % increase of my portfolio(not bad for a month).
            What is the average return that i should expect,if i diversified well my portfolio and i re-balanced him once a year-what is the average annual return that i should expect ?
            Cheers

          • It’s tough to say what your average annual return will be. Over 30 years, it should be between 7% and 10% per year. Over ten years (I consider that really short term) you could make between 0% per year and 15% per year.

            Cheers,
            Andrew

          • moortomas says:

            Thanks

  150. Katie Leese says:

    Thanks Andrew! I’m trying my best with my colleges. Some of them have bought your book and we are working on the others!

    So it has to be VMID as it has a broader exposure – 250 companies rather than 100 and the exchange ratio difference is pretty negligible at just 0.01% more. Was I right? A+ grade?

    Thanks,

    Katie

    • A+ grade! Go Katie go!

      When choosing between two ETFs that track the same stock market, it’s always better to go with the one that’s more diversified (as long as the expense ratios are similar). That’s why the U.S. Total Stock Market Index would be slightly better than the S&P 500. The former has a great number of holdings. The same premise is true with the FTSE 250 versus the FTSE 100. At times, the 100 will outperform the 250. But the 250 will be slightly less volatile, and over a 25 year period, their results will be virtually identical.

      Keep teaching your teachers Katie!

      Andrew

      • Neil says:

        Hi Andrew,

        Please tell me if I am talking nonsense – the FTSE250 tracks the next 250 biggest companies after the FTSE 100 so they don’t track the same companies. FTSE100 covers approximately 80% of the British market – as far as I understand. From reading around the internet – because it contains larger and therefore more stable companies – the FTSE100 tends to be slightly less volatile.

        However, the FTSE250 is far more UK-focused as it contains fewer multi-nationals so it might be a slightly better pick (than VUKE) for UK expat investors looking for diversification? If VWRL is owned the FTSE100 companies will already be owned through VWRL? Or is this all far too complicated to worry about?!

        Thanks,

        Neil

    • Hey Katie,

      Here’s a thought. You could buy the FTSE 100 and the FTSE 250. There’s no overlap. I initially thought there was! The FTSE 100 has the 100 largest stocks; the 250 has the next 150 largest companies.

      So full diversification comes from owning both.

      Cheers,
      Andrew

  151. Katie Leese says:

    * colleagues not colleges!

  152. Ryan says:

    Hello Andrew,

    Thank you for all of the work that you do to educate expat workers like myself. I too am an expat teacher, currently working in the Middle East, but with no idea where I will one day settle. Therefore, after reading your books have tried to come up with the most diversified blend of stocks/bonds possible. I was just wondering what you thought.

    50% AAA Global Gov Bonds
    25% Developed World Stocks
    25% Emerging Market Stocks

    In my view it is well diversified, low cost and balanced. However, I remember you once writing about how EM were not as good as Developed markets, if I remember correctly I thing you were referring to China at the time.

    Anyway, just wondering your opinion, or if you think a 50/50 global stock/bond mix might be better.

    Thanks in advance,

    Ryan

    • Hi Ryan,

      If you’re looking for more growth, dial back on the bonds to within 30% – 40% of your total, and decrease the emerging market exposure. That EM exposure is very high.

      Cheers,
      Andrew

      • Ryan says:

        Thanks for the advise.

        Do you think I should even bother having an EM component in my portfolio?

        Any advantages/disadvantages? Or would developed stocks and developed bonds be better?

  153. Graham says:

    Hi Andrew,
    Finally about to make the plunge with TD and buy VWRD (usd) and either SAAA (gbp) or IAAA (usd). I am a little confused about the two iShares bond ETFs. From what I can gather SAAA is sold on the London Stock Exchange while IAAA is sold on the Swiss Exchange. Am I right in thinking that both bond ETFs are identical other than where they are sold? I would like to have both my stock and bond ETFs in the same currency (to avoid having multi-currency accounts) so was going to opt for VWRD and IAAA. There also appear to be two types of IAAA ETFs, one that pays dividends and one that doesn’t. Is it obvious to choose the one that pays dividends? Thanks in advance for your advice/suggestions.
    Regards,
    Graham

    • Hi Graham,

      If you have found an ETF that doesn’t pay dividends or interest, that’s a swap based product, also known as a synthetic ETF. They pose slightly higher risks because you don’t own the entities in a physical sense. I discussed the pros and cons, with a deeper explanation, in my expat book. Here’s link: http://bit.ly/globalexpat

      Cheers,
      Andrew

  154. charlie says:

    Hi Andrew,

    Hope you are well. Saw your talk in Dubai, but by then you were preaching to the converted.

    I do however have a friend in a Zurich Vista 25 Year Plan. He has sent me his statement to ask me my advice. I would really appreciate some input on his plan to make a case for him to pull out.

    He started in Feb 2013 investing $1360 a month.

    Current Value:
    57,537
    Total Premiums Invested: (this is a bonus Zurich add)
    64, 635
    Total Premiums Paid:
    54, 438

    From doing a backtest, he should have around $69k if he followed an Index approach. He seems to think that he has made 7% a year, but that’s just working on his contribution and not considering the ‘bonus’.

    What are your thoughts to give me some ammo?

    Much thanks,
    Charlie

    • Charlie,

      This sounds hard core. But your friend, in time, will figure out what he has done. Ask him how much he could withdraw today. That’s what his money is truly worth. That’s the figure that might shock him. Money isn’t real on a statement unless it can be real in your wallet. Zurich has given him a great smoke and mirror show…as they do.

      Andrew

    • toony says:

      Charlie,
      It’s going to be a tough discussion with your friend – hopefully they go past the denial and anger phase and move quickly to the hopeful part.

      Here are some raw facts you can use:
      *Zurich Vista 25 yrs = 18 months of “initial units”. This is just the fancy word for the ‘upfront, non-refundable, hidden fees’ for just opening an account! (Yes, you read right, EVERY $ your friend has put in the plan for the first 18 months goes directly to the pockets of Zurich and the salesman! It takes 8-12 years of continuous saving to break even!

      *The initial units are clawed back by Zurich at 4% pa for 25 yrs (ie 100% of initial units OR whenever the plan is surrendered – this trap is in the very fine fine print that is NEVER explained properly to the client otherwise no one would ever buy such a product. The role of the ‘bonus’ units is to hide the massive fees eating at the funds otherwise people would bale the plan well before the ‘initial period’ ended!

      *As Andrew suggested, get your friend to ask for a ‘surrender’ value of plan. It should only be around 30k ($54.4k paid in – $24.5k in upfront fees!)

      *Bonus units is the major smoke and mirror ‘feature’ used to trap people. Bonus units are part of the ‘initial units’. As shown above, Zurich ALWAYS take 100% of the initial units regardless of what happens. Whether Zurich gives $1 in bonus units or $1M (or even $1B) in bonus units, clients will NEVER see a cent of this bonus! (An aside note – the bonus is cleverly chosen to be high enough to entice people to sign the trap but not high enough to trigger the BS alarm in most people!

      *Since it’s more than 18 months, Zurich has fully trapped your friend. Now they are just trying to bleed as much fees as possible from the ‘accumulation’ units – the higher this number gets and the longer your friend stays in the program, the more they can bleed!

      *Zurich will abuse people’s ‘aversion to lose’ and try to convince your friend to continue…same goes for the FA as they get a trialing commission for EVERY extra months they keep their client in the program after 18 months!

      *Encourage your friend to leave asap. Initial units can’t be salvage but remaining funds can be put to better use.

      *Inform friend that he’s lucky to find out now and not 20 years from now – Zurich would have bleed $500k+ more in fees if stay entire period!

      *Buy/loan Andrew’s book to your friend.
      *Help friend start an account (I recommend IB) and set up index fund portfolio as recommended in the book.

      Good luck with it!

  155. Derek says:

    Hi Andrew,

    I’m a Canadian Expat living in Indonesia. I can’t use TD Direct Investing International as you mention in your book. What would be your second choice for someone like me?

    Second question is regarding currency. I just read your article that it doesn’t matter much what the currency of the ETF is. I get paid in USD and don’t know where in the world I’m going to retire so just wanted to keep it in USD. I was thinking of using the TSE to invest in Horizon (HXT/HXS), iShares and Vanguard (VSB) distributed over bonds/us s&p/international. Almost all are in CAD. Should I just convert to CAD or is there another way/different ETF’s kept in USD?

    Thanks

    • Derek,

      Unfortunately, virtually no brokerage trusts Indonesia. But there is one that will allow you to open an account: Interactive Brokers. You could then buy ETFs off the TSX, as mentioned in my book, The Global Expatriates Guide To Investing. Here’s link: http://bit.ly/globalexpat

      I wrote about the very very slight risk of using this brokerage in my book, relating to U.S. estate tax issues upon death. But realize that this risk is small. Later, if you decide to move from Indonesia, you could (if you wish) transfer the assets to a different brokerage, such as TD Direct International.

      Cheers,
      Andrew

      • Derek says:

        Thanks Andrew,

        One follow-up question. In your book you quote using iShares S&P/TSX Capped Composite Index ETF for Canadian Index. There is also the Horizon (HXT) one mentioned here on your blog. If I plan on 25% of my portfolio being Canadian Index, do I choose one or spread evenly on both or some other formula.

        I guess my main question is if I’m going for a Canadian Index, how do I choose from iShares, Vanguard, Horizon, etc?

        Thanks

        • Hi Derek,

          My book mentions the Horizon product too, in the section where I wrote about lowering taxes for Canadian expats. It’s a swap based product. Find it in the book, to see what I say about extra returns, but slightly higher risk. The choice, then, become yours.

          Cheers,
          Andrew

  156. Jason says:

    Andrew,

    Ok, moment of truth for me. I plan to open Vanguard Total US, Total Int, and Short Term Bonds (all Admiral Shares) as laid out in your Expat’s Guide book this summer. I will be a stone cold, emotion free, couch potato. I’ll add my new money each month to the losers and rebalance ones a year as needed to maintain a 60/40 split.

    As a first year international teacher, I’ll be entering into a slightly grey area when I open the new accounts (US credentials intact) . My question is: should I bypass Vanguard altogether and just open the same 60/40 spilt with a robo-adviser account such as Betterment instead? I’m not quite sure I understand the advantage of a robo-adviser over going straight to the source, which would be cheaper.

    Any thoughts?

    Thank you,

    Jason

  157. Jason says:

    Andrew,

    Thank you for the article link. I remember reading that one when you originally posted it sometime back. So what I’m reading is that you would recommend somebody who is soon to become a US expat to open a Vanguard target retirement found (2025 in my case) in a taxable account vs owning the three mentioned indexes and maintaining the proper allocation themselves?

    • That’s right Jason. In my view, it’s an easy decision to make.

      Cheers,
      Andrew

      • Jason says:

        Andrew,

        Should an expat holding a Target Retirement fund in a taxable account have concerns about the taxable turnover based on the trading occurring within the fund and the funds yearly rebalance? VS – an investor purchasing his own indexes individually, could buy the lagging index each month, thereby keeping the portfolio aligned without having to sell anything.

        Now I’ll stop beating this dead horse. 🙂

        Jason

        • No Jason, they should not be concerned by this. Otherwise, I would not have recommended it.

          Cheers,
          Andrew

        • Jason,

          My wife owns Vanguard’s Target Retirement 2020 fund. She’s American. She has owned it for years. It’s in a taxable account and it’s extraordinarily tax efficient. I love it! If I didn’t, we wouldn’t own it.

          Cheers,
          Andrew

          • Jason says:

            Andrew,

            Thank you so much for all that you do, and your replies!

            I like the simplicity of the Target Retirement fund, and paying into it monthly with auto pay. When I geek out talking about investments and early retirement, my wife’s eyes glaze over pretty quick, so something as easy as a Target Retirement fund might be our perfect compromise. We would fall into the 2030 plan.

            We will not have a pension to fall back on, so I plan to follow the bonds-to-age link. It looks like all the Target Retirement funds eventually enter the “retirement” allocation of:

            Stocks: 30%
            Bonds: 53.2%
            Short-term TIPS: 16.8%

            Is that to allocation to conservative for the average 53+ year old international teacher with no pension? If not, great! If so, would you, at some point, roll from the 2030 to the 2035 in a taxable account?

            Thank you again, Andrew. This is all so helpful!

            Jason

          • Hi Jason,

            Your choice of fund is entirely up to you, and your risk tolerance. My risk tolerance may be higher than yours. I’m 46 years old. But I will never have more than 40% of my portfolio in bonds (that’s where it sits right now). That’s because I don’t mind volatility, and I plan to be retired far longer than I spent working.

            If you make this choice, later, don’t sell and switch. You will trigger capital gains. Just start adding a different index at some stage, with your fresh money. You could start adding a global stock index if you like. https://personal.vanguard.com/us/funds/snapshot?FundId=0628&FundIntExt=INT

            My wife owns the Target Retirement 2020 fund. We are aware of our TOTAL bond allocation (her account + mine) so in my account (we could also be doing this in hers) we add more equity indexes.

            If you have a moment, Jason, would you mind posting a review of my book on Amazon? That would be awesome. Thanks! Here’s link: http://bit.ly/globalexpat

            Cheers,
            Andrew

  158. Ryan says:

    Hello Andrew,

    In your book you recommend the following:

    60% IWRD
    40% SAAA

    Do you think that there would be any difference using this?

    60% IWDA
    40% SAAA

  159. Jason says:

    Andrew,

    Yes, I will absolutely write up a review on Amazon. I reference your books and website on a weekly basis, so it’s the least I can do. I’ve appreciated all that you do spreading the index fund information to teachers, expats’s, and so on. Thank you. Also, I’m considering bulk ordering 10 copies of Expat’s Guide to distribute to my fellow teachers. I’ve loaned out my coffee stained copy enough that I’d just like to be able to hand out copies for keeps. I’m also looking forward to the next addition Millionaire Teacher! Any idea on an release date?

    I’ve spent the last few days considering the idea of matching a Target Retirement fund with VTSWX, and that might be my winning combination. I’m finally gaining an appreciation for all the different amazing index fund combinations one could do as an investor. Your book mentions the VTSWSX/VFISX combo, and it looks like Vanguard lower the VTSWSX fee to .25. I imagine a VTSWSX Admiral Share is just around the corner. Is VTSWSX/VFISX still a combination you would stand behind? It seems just as easy as the Target Retirement/VTSWX combo. I’ve also spent some time considering the Vanguard Life Strategy Funds. Something like VSMGX holds a 60/40 allocation, so I could hold that “all-in-one” fund for the long haul and eventually add VFISX if I want something more conservative down the road.

    The possibilities are endless!

    Thanks again,

    Jason

    • Hi Jason,

      It looks like you can order them, off Amazon, at a price cheaper than I can buy them! Here’s the book’s link: http://bit.ly/globalexpat
      Cheers,
      Andrew

    • Thanks Jason,

      Because you can’t see the future, and because you’re now thinking about splitting the split hairs of hairs, I think you should close your eyes, make a decision, and stick to it. The options that you are thinking about will be largely inconsequential, many years down the road.

      Don’t get affected by the paradox of choice. All of these options are excellent. Just make sure you have the strength to stick to your game plan. And thanks for the review!

      Cheers,
      Andrew

  160. Hels says:

    Dear Andrew

    I hope you don’t mind helping me with these questions just before I make the leap…:

    1. I initially wanted to do the Permanent Portfolio, but can’t find a decent savings account anywhere as I’m a British expat living in Hong Kong – I’m restricted from using the UK ISAs and other higher savings accounts. My bank, HSBC HK, offers minute savings of much less than 1%. I’ve searched around for an accessible savings account offering good returns, but am hitting a brick wall – any ideas? If it’s a dead-end, then I’ll do the Couch Potato Portfolio, but thought I’d ask.

    2. I’m on the verge of opening a brokerage account with DBS Vickers in Hong Kong after reviewing the comparison table in your book. However, I’ve had a couple of friends saying that I should do it through HSBC as I already have a bank account with them, although I find their website pretty confusing. Thoughts?

    Thank you!

    Hels

  161. Steve says:

    Andrew,

    Hope you can clear up some misunderstanding I am having.

    Taking the strategy for a European to have 50/50 allocation of stocks between US and Global, why would one need to own anything else than VWRL/D? This is made up of ~52% US stocks and ~25% European stocks

    Table 21.4 in the expat book is made up of VWRD AND 25% of a specific European index. Wouldn’t just investing in VWRD give you the same allocations?

    Thanks
    Steve

    • Hi Steve, if you simply own VWRL/D you would not have a 50/50 allocation between global (including U.S., Pacific and Emerging) and European stocks. That’s why I added the European index. Without the European index, just 25% of your stock holdings would be European. You may want to push that allocation to 50%.

      Cheers,
      Andrew

      • Steve says:

        Andrew,
        That’s right, it would be a 50% US / 25% EU / 25% Rest of world allocation. So why the need for a seperate dedicated 25% EU ETF?

        Thanks
        Steve

        • Hi Steve,

          I explained my preference for that in my book. But that’s just my opinion.

          Cheers,
          Andrew

        • Steve,

          Here’s what I wrote in my book:

          “Where Do You Plan To Retire?
          Americans should have a nice chunk of U.S. exposure if they plan to retire in America. Canadians, Australians, Brits, Europeans, Singaporeans or any other nationality with an established stock market should do likewise with their home country market.

          Keeping it simple, you could split your stock market money between your home country index and a global index.
          For example, a 30-year-old British investor could have a portfolio comprising 30 percent government bonds, 35 percent global stock index and 35 percent British stock index.
          An American’s composition would be different: 30 percent bond index,
          70 percent Global Stock Index

          You may be wondering where the American stock market fits into the above portfolio. A truly global stock index comprises roughly 48 percent U.S. stocks. As such, no separate U.S. index would be required.”

          If it’s a developed market, I like having at least half of the exposure to that country’s stock market and currency. If you will be paying all future bills in Euros, I feel it’s best to have a very large Euro based market component.

          Cheers,
          Andrew

          • Steve says:

            Right got it. Sorry i was forgetting the bond aspect of the allocation and thinking 25% in the VWRL was 25% of the total allocation…which it of course isn’t…..i’ll get back to my bourbon

  162. Tim says:

    Hi Steve

    Thanks for your book. Really informative and straightforward. Just wondering if you can help with a question on the Aust Expat Fundamental Portfolio.

    I’m an Australian living in Singapore with a NAB Trade online broking account in Australia. I went to set up my Fundamental portfolio and found the broker will not trade PowerShares FTSE RAFI All World 3000 (PSRW). I can trade VGB and QOZ..

    Can you recommend 1 or more substitute ETFs for PSRW? I could add a BetaShares FTSE RAFI US 1000 (QUS) but I would need a fundamental index to cover World ex US.

    Hope that makes sense?

    Tim

  163. didic says:

    Andrew,

    I am in the process of switching of from Zurich type fund to ETF for my retirement, i have one concern related to the sale of ETF?
    I am looking at buying the vanguard developped world, how easy is it to sell them? is there a risk of not finding ETF investors in future?

    • DiDic,

      It takes about 30 seconds to sell at ETF–probably less than that! Vanguard’s ETFs have some of the highest volumes in the world. Selling is a breeze. Congratulations on finding such a sound solution.

      Cheers,
      Andrew

  164. Han says:

    Hi Andrew,

    I have just started reading your Global Expat book. Chapter 1 is talking about recording your expenses and that it’s easy to do with an app. I am doing some research on good apps available in Singapore (I was trying to find Mint but it’s not available in Singapore). I would be interested to hear which apps people use here. Do any apps available here sync to your bank account? I haven’t had much luck in my search so far.

    Thanks!

  165. Steve says:

    Hi Andrew, I’m reposting this as it may be overlooked in the middle of a large thread…

    Andrew,
    I understand from the earlier discussions with Tito and Darien that it is beneficial to have all investments listed on the same stock exchange so that rebalancing can be handled without exchange rate issues.

    I am paid in EUR so ideally it would be best for me to trade on an EU exchange. However due to access to some ETF’s I cannot avoid London. Therefore I am trying to pick ETF’s listed only on London. This would incur an exchange rate cost when paying in new monies each month however I know there are ways to reduce this from links you gave earlier.

    Where I am getting confused is understanding in which currency an ETF is denominated in. Searching on TD Direct for VWRL (FTSE All-World) I receive 3 ETF’s. The only differences being the price currency in GBP, CHF or EUR. They are all traded in London so I thought the denomination would be GBP.

    If I was to purchase the EUR one what would be the advantage/disadvantages? Would it avoid the exchange hit when paying in new EUR monies but incur an exchange hit when rebalancing with a GBP ETF?
    I’m looking at using VWRL for my global ETF and VEUR for my European portion but they both come in different flavors.

    Thanks once again for your advice
    Steve

    • Hi Steve,

      My apologies for not getting back to you earlier. I’m getting more questions than I can handle, and many are multi-layered. I appreciate your patience. You asked this:

      “If I was to purchase the EUR one what would be the advantage/disadvantages? Would it avoid the exchange hit when paying in new EUR monies but incur an exchange hit when rebalancing with a GBP ETF?”

      If paying in new Euro monies, you wouldn’t have to deal with a currency hit—just a spread. That would likely cost a one-time (for each purchase) 1% spread.

      Rebalancing multiple currency ETFs can be a pain. Fortunately, at some point soon, you’ll likely find far more examples of ETFs trading on multiple exchanges and currencies. They are popping up like crazy. That’s a really good thing.

      But you may not need to physically rebalance any of your ETFs. First of all, letting asset classes drift a little bit isn’t a big deal. In fact, drifting asset classes sometimes outperform portfolios that are rigidly rebalanced. Play with this a bit, using historical comparisons with portfoliovisualizer.com. It will allow you to backtest portfolios of U.S. listed ETFs to see how they would have performed over different time periods. You’ll find that sometimes, regular rebalancing helps, other times it hinders. You’ll never know, ahead of time, but it’s interesting to see some history.

      That doesn’t mean you shouldn’t rebalance. Doing so reduces risk. But here’s what you could do: before adding fresh money in a given month, compare your portfolio’s allocation as if it were in a single base currency. Determine which ETF (measured in that single base currency) under-performed the other ETFs in the previous month. Then add money to that one. This will allow you to “rebalance” each month without selling anything. If markets crash 20% or so, you would need to physically sell and rebalance. But unless that happens, you won’t really need to. Don’t worry if “buying the lagging index” means your portfolio allocation swings a little bit. It’s not an exact science, as you will see when you play with the rebalancing option at portfoliovisualizer.com.

      Cheers,
      Andrew

      • Charlie says:

        Hi Andrew,

        This happens to answer a question I’ve had for a while.

        I’ve been running my Saxo portfolio for a year and a half. In that time I have balanced it each month by putting a little more into the lagging funds to keep my split.

        Alternatively I could put exactly the same amount into each fund, each month and rebalance once a year. (eg, $10 000 is split 70/30 into stocks and bonds each month)

        Any difference in these approaches?

        Charlie

      • Steve says:

        Andrew,
        No apologies required…victim of your own success!

        Thanks. I had also wondered if I really need to between ETF’s rebalance or just add fresh money in order to accomplish the same thing (so really buying and holding).
        I guess there is no more delaying and I should get started.

        Thanks again
        Steve

  166. Isch says:

    Hello,

    I am reading your Global Expat book and am really interested in the parts about pensions. My husband and I are Brits living in Singapore and have had our Aviva pensions for 6 years. There is a new law in the UK that states you can’t withdraw your pension early (except under certain circumstances not applicable to us) and can only transfer it to another provider.

    http://www.gov.uk/early-retirement-pension/personal-and-workplace-pensions

    I was thinking, might it be best to just stop payments and try and convince my husband’s employer to contribute to our portfolio (about to transfer bond and 2 ETFs to TD Direct International)? I don’t work at the moment.

    Would be interested in yours, and anyone else’s, thoughts.

    Thank you!

  167. Will says:

    Hi Andrew,

    Living in Eu and not coming back to U.S
    I have (VXUS) VG total Int ETF and has about 45% in EU, should I also purchase (VGK) VG EU ETF to add more EU exposure or just purchase more VXUS. Adding for VXUS would add more exposure to merging markets.

  168. Rich says:

    Andrew,

    I’m a Brit in Singapore and came dangerously close to signing up with one of the IFA’s peddling Zurich, fortuitously I go too busy and never invested. Your two books are excellent reads very informative and practical, I feel much more in control of my plan which are as follows;

    40% PowerShares FTSE RAFI UK – PSRU  
    40% Vanguard All World – VWRD
    20% i-Share UK Gilts 0-5yrs 

    My conundrum is whether to pound cost average or invest the whole lump sum upfront (over the long term agree a lump sum is likely to offer greater return) and then keep contributing monthly. The reason I’m hesitating with the lump sum approach is I will be buying a property in the UK in 18 months time and need some of my funds for this. However the thought of it sitting in the Bank doing nothing for 18 months is not very appealing.

    By the way thanks for the tip on TD I have set up an account with them – superb customer service.

    Rich

    • toony says:

      Rich,
      Lump sum investment is generally better than DCA (dollar cost average). It’s time in the market, not timing the market that matters. DCA tends to be better for people emotionally…not financially!

      Don’t invest in equity any money that is required in 18 months (eg for house) as the market may move in an averse direction! You are much better off putting the needed amount in a high interest bank account and/or CD/term deposit.

  169. Janine says:

    Hi Andrew

    Any reason why people should be worried about their accounts held with TD Direct International (Luxembourg) ? I just read that Barclay’s is making a bid to buy TD Direct in the Uk. I was under the impression that TD Direct Internnational was just the international arm of the U.K. Based TD Diect.

  170. Penny says:

    Hi Andrew,

    I’ve just finished reading Millionaire Teacher and am very inspired to get my finances and investments in order. I’m a dual US/Canadian citizen and will be moving back to Canada soon, and I’m trying to figure out the best place for my money when it comes to investing in index funds.

    My preference would be a TFSA but it sounds like that can get messy as a US citizen. An RSP doesn’t make much sense for me either, and it sounds like things can get sticky for a US non-resident to hold an account with US-based Vanguard. I’m a low-income earner, I’d like to try and keep it all as simple and straightforward as possible (because I’m new to investing), and I’m at a bit of a loss. I would love to hear any thoughts you might have.

    Many thanks for your time and expertise!
    –Penny

  171. toony says:

    Isch,
    The name Aviva (an insurance company) sets off soooo many warning alarms. A golden rule is NEVER mix investment/pension with insurance!

    UK expats looking to transfer their pension offshore are prime targets by “Independent Financial Advisors” and Insurance companies (and some banks too) who are looking to legally steal your life savings…be very very careful!

    I like the idea of contributing to your TD account with ETFs where you have control of your money with no hidden traps and low fees

    • Isch says:

      Thank you toony! Sorry, I just read this. I need to get in touch to find out whether I can just stop payments and leave what I’ve already invested in that account as I am not allowed to withdraw. I’m guessing that’s my only option. So unbelievably frustrating. I invested before I knew anything about investing (but was told that I absolutely must have a pension) and hadn’t read Andrew’s books.

  172. Alexander says:

    Hi Andrew,

    I have taken all of your advice and am now an investor in ETF funds using Interactive Brokers.

    I am currently looking to invest my second lump sum, which is the biggest of all (I dipped my toe with the first smaller amount!). Im investing in VUKE, VWRL and VGOV but am torn at this second purchase, because both VGOV and VWRL are at all time highs! VUKE is however at a reasonable low point…

    Im tempted, as VUKE has higher dividends too, to invest most of my lump into VUKE and then play catch up with the rest (to get 35%, 35%, 30% portfolio), but realize that isn’t a very balanced portfolio to start with! Have you any advice that may help me? 🙂

    Thank you!
    Alex

  173. Tim says:

    Hi Andrew,

    Just wanted to update people on Montpelier finance. Maybe someone has already mentioned them but they closed a little while back. Unfortunately, no one told me. Stuart Williamson, CEO Asia Pacific put in the hard sell when we first arrived in South Korea – in the end he manipulated forms, missold products and took advantage leaving us tied in to a 20 year Friends Privident account and a Old Mutual Pension fund that has lost 17%. He now runs a property business. It was clearly our fault for believing him, I take full responsibility for that, however, for those invested with Montpelier, check your accounts, they are about to be overseen by 360 financial. I found out they had closed because none of my emails were answered and then an FA at 360 got in touch to take control of my funds. The next step is now figuring out what to do with the Mutual Fund pension and how I can get the money somewhere a little safer. Any advice would be gratefully received.

    Thanks

  174. Mike says:

    Tim

    I had the same problems with Williamson and Montpelier, they are a bunch of thieves. I lost about 35%of my portfolio getting out of the various products I was tied to. AES in Dubai have been really helpful getting me out of the mess I was in, Stuart Ritchie in particular has been a lifesaver chasing up OMI and FP for my money. Good luck

  175. Tim says:

    Thanks for the recommendation Mike, I am really grateful. Just trying to extricate myself from the mess I am in and will lose a fair amount. Not sure on percentages yet but looks pretty steep so far. I’ll probably give Stuart a call and see what advice he can offer. Thanks again

  176. Graham says:

    Hi Andrew!
    I was wondering if you could share your thoughts on the current bond market in Europe. I was reading a short news piece today saying that many of the European government bonds (UK, German, Switzerland, France and Belgium) are at all-time lows, several even giving negative returns! I know in your books you stress the importance of long-term investing, but as you also recommend short-term bond ETFs (to stay ahead of inflation), is it wise to buy bond ETFs now? I just opened an account with TDI and was planning on purchasing the SAAA or IAAA bond ETF. As always, your advice is always appreciated!

    • Graham,

      You are speculating.

      Don’t.

      This rule (not to speculate) will apply in the year 2017, 2021, 2056, no matter what the markets are doing, no matter what the circumstance. Every year. No matter what.

      Cheers,
      Andrew

  177. Mark says:

    Hi Andrew, Just finished your most recent book and love the message: Combine an appropriately diversified ETF portfolio with strict rebalancing to be, in effect, your own robo advisor? I am a dual Canadian/British citizen living in Ottawa and about to move to the UK. I intend to keep holding my life savings in non-reg and reg accounts with my Canadian discount broker while abroad. You raise the notion of accumulating assets in the currency of the country we’ll eventually retire to and that is my intention.
    While I will not be able to contribute to a TFSA while abroad, I should be able to open the UK equivalent – an ISA and wonder if that would be a good idea. Thanks for encouraging all of your followers to be their own robo advisor!

  178. Cat says:

    Hi Andrew,
    I’ve just filled out the application form for td international. They are requesting a phone interview to understand my ‘experience’. The form asks what your experience is and will only let you complete your application of you say you are an experienced investor ( which I am not but of course ticked the box to open the account) any helpful hints for this phone conversation? I would be very grateful,
    Many thanks,
    Cat

    • Steve says:

      Cat,
      I’ve just gone through this recently. I was basically asked if I understand that I could incur losses. Upon confirming that yes I understand there were no further questions. I was also slightly worried that i would be quizzed on my experience but that was basically it,.

      Steve

  179. Andrew says:

    Hi Andrew

    Firstly, thank you so much for all of your advice and guidance; without exaggeration, you’ve probably saved many of us here in Abu Dhabi hundreds of thousands – if not millions – in the long term. I know I speak for many of my colleagues at Brighton and Cranleigh when I say that we are really looking forward to your sessions here in February 2017.

    I just have a question about my particular circumstances. I am working in the UAE on a UK passport. Although I haven’t lived in Canada (dual citizenship) for over 15 years now, my wife and I figure we are most likely to retire there in the future, so are looking at buying our ETFs on the TSX. I’m in the process of opening an account with TD International, having just sent off the documents today. A British colleague, who is one step ahead in the application process, was sent Canadian Revenue form to fill in by TDI which, if i understand correctly, mentions that if choosing the Canadian stock exchange we might be liable for a 15% tax on investments. Am I understanding that correctly? If that is the case, would we be better off going with London or Europe to avoid taxation? Obviously I will ask them about it in the imminent telephone interview, but I thought I would run it by you. Our planned portfolio is very similar to the one you posted on here a while back. Are you liable for tax on investments or if you sell your ETFs at some point whilst abroad?

    Any advice would be greatly appreciated. Thank you again for all of the guidance offered thus far in your books, articles and comments here.

    Kind Regards,
    Andrew

    • Hi Andrew,

      The taxation you speak of, as mentioned in my expat book, is the dividend withholding tax only. Your British colleagues will also pay withholding taxes on dividends, but they will pay slightly more than you will 🙂

      Even the friendly Friends Provident accounts (super sarcasm intended) will charge dividend withholding taxes (it’s in the tiny print of their prospectus). There’s no way around this. But you still have the most tax free portfolio in the world, with capital gains completely tax free. Please read page 191 of my expat book. And for the only option around dividend withholding taxes (albeit, with synthetic, swap based ETFs) please read pages 231 and 232 of my global expat investing book. Here’s the book’s link: http://bit.ly/globalexpat
      Cheers,
      Andrew

  180. Frank says:

    Hi Andrew – Having completed all of the necessary paperwork, I’m just about to transfer all my stocks from Saxo to TD Direct. I have a naive but (I reckon) important question. Do I select the “Use spot price” check boxes or not? I don’t want to lose lots of money by doing the wrong thing. Thank you (as always).

  181. Chris says:

    Hi Andrew (and other US expats)

    I know you not a lawyer or an estate planner, but I was wondering if you or other US expats out there know anything regard estate planning for US expats particularly US citizen marry to non-us citizen not living in US. My wife (EU) citizen will be moving back to Europe. She will be losing her US green card. We both have joint investment account and she has retirement accounts. My question is if I pass away, how can my wife avoid US estate tax (roughly 40%) on assets over $60k. In your case Andrew since you wife is american, how are you prepared for the worse? This question probably needs to be answered by estate planner. Any recommendation on one experienced with expats?

  182. Nick says:

    Hi Andrew

    Wow! I wish I had seen your writings twenty years ago; but very glad I still have 20 (ish) years to go before retirement. I have liquidated Friends Provident savings (OUCH!) and opened Saxo account. I am British/Irish Singapore expat.

    I have found your books enlightening. I am also struck by the complexity here. I intend to open a portfolio and add every quarter. Two questions:

    1 I take your point that ‘the best time is now’ as the future is unpredictable. But the two projections you make seems to assume you start saving either now, or at a market low. Then the loss of time in the market outweighs the better timing. But surely it is better to save in a bank account with 2% and then time your first entry, putting all this in at a crash? So yes, teh best time is now to start saving, but try to time your entry….. knowing that you can never bit rock bottom but go for, sat, a 20% discount. Then the total savings amount is still the same, but you get a one-off good time to enter….? I am sure I must be missing something here…

    2 I haev substrantial investmetn in UK property, whcih generates an income. I rather regar that as the “gold+cash” part of things, adn after many years of poutting all savings into that, now want to diversify. I like the Vanguard philosophy and structure. So, given that I want to be in UK, in GBP, and avoid NYSE at all costs, I am thinking

    (A) maybe just go for 100% in Vanguard Balanced Index Fund Admiral Shares (VBIAX) as I am lazy and honestly, not very good at this. I cannot tell how to do this – on SAXO I cannot find it. Can you advise?

    (B) I was looking at IBGM as you advice, but the the in SAXO seem to be trading from Holland or Italy. I was thinkign I should be in London. Is that right?

    I appreciate you cannot give actual investment advice, but if you have any thoughts on a select few Vanguard ETFs that might suit a prudent long term investor, I would be interested to know your thinking.

    sincerely
    Nick

    • Hi Nick,

      Let’s assume you wait for the markets to crash 20%. Assume they rise 100 between now and 2022, before you get such a crash. Would you really be ahead, buying at a 20% discount in 2022, while missing both a market gain of 100% and dividends along the way? As I mentioned, time and again in both of my books, you cannot time the markets. Even trying to will cost you far too much money. Big stock market gains are usually concentrated during just a handful of trading days each year.
      During the 20-year period between 1994 and 2013 (5,037 trading days) U.S. stocks averaged a compound annual return of 9.22 percent. But if the investor missed the best five trading days, they would have averaged just 7 percent per year. If they missed the best 20 days, their average return would have plummeted to just 3.02 percent per year. If they missed the best 40 trading days, the investor would have lost money.
      What Could You Miss By Speculating?
      1994-2013

      Average Annual Return $10,000 Would Have Grown To
      Stock Market’s Return 9.22% $58,352
      Best 5 Days Missed 7% $38,710
      Best 20 Days Missed 3.02% $18,131
      Best 40 Days Missed -1.02% $8,149
      Source: IFA Advisors
      https://www.ifa.com/12steps/step4/missing_the_best_and_worst_days/

      You also asked me about the best Vanguard ETFs. I listed model portfolios in my expat book. You could check for your nationality and select from the model portfolios. Here’s the book’s link: http://bit.ly/globalexpat
      Cheers,
      Andrew

  183. Nick says:

    Hi
    Sorry , forgot to add to (a) above that I was also looking ar the Vanguard Retirement Target fund for 2035 or so. But that seems to be in NYSE, unless I am muddled. Is there a LON one?
    Nick

  184. Adam says:

    Hi Andrew,

    1) I have a saxobank account based in Denmark and I am a Dubai resident. What happens to my money if saxo bank goes bust? If i am only covered for a small amount what can i do to safeguard it?

    2) At the moment I am transferring AED4000 a month into my account and buying one of either the wold etf or the UK etf. Not been buying bonds etf with that months money at moment. Should I as it is only 23% of my portfolio now. I am 36 years old so should i put higher bonds over the next 3-4 months?

  185. Isch says:

    Just wondering what Britain leaving the EU means for people (like me) investing in the UK stock exchange? I am in the process of transferring everything from DBSV to TD in order to do that. I can’t figure out if the pound plummeting is a good or a bad thing (although clearly just a reaction to the result of the referendum). Sorry, probably really obvious to most!

      • Isch says:

        Oh gosh, now I’m really confused. I am a British expat living in Singapore and I had an account with DBSV but was transferring to TD so I could buy a UK bond (Vanguard UK Gilt UCITS), British stocks (Vanguard FTSE 100) and global stocks (Vanguard FTSE All World).

        I’ve just read the article and it talks about the list price not being important, as investing in a British stock market index means you’re betting on the British pound. Is that not what I’m doing?

        I was about to transfer about GBP150k into these ETFs but not sure what to do now.

        Sorry if this is basic stuff. I have read both your books but no matter how hard I try my understanding is so elusive.

    • toony says:

      Isch,
      ANYONE that alters their asset allocation in reaction to new development (eg Brexit) or financial forecasts is simply ‘market timing!’

      A ‘Golden’ rule of investment is to stay with your asset allocation (which depends on your risk tolerance) and ONLY alter it when PERSONAL life circumstances changes (eg approaching retirement etc)

      With the market dropping in reaction to “Brexit”, all ppl need to do is simply rebalance their portfolio (if required) and/or buy the discounted index fund/etf with their future purchases.

      I’m grinning from ear to ear at the moment. I get to buy the ‘whole world’ at an awesome discount with my next pay check 🙂

      • Isch says:

        That makes sense. Thanks!

        Would love your opinion on the inheritance I have in my uk savings account. Invest it in TD or wait for the pound to rise again? Does it not really matter that it’s worth less now as I’m investing long term?

        Thanks again!

  186. Frodo says:

    Hi Andrew,

    Canadian citizen here along with another citizenship. Currently working in HK. Previously in Singapore. Moving to Taipei soon. Savings in CAD, USD,HKD and SGD, none of which is invested, sitting in cash. Considering I will not move back to Canada and aim to retire in a 3rd world country, I would like to convert all my money in USD and form a portfolio. My question is: Should I convert all my money into GBP instead and form a portfolio like a British expat given pound has dropped and stick to it and contribute monthly in GBPs? Or should I stick to USD? I am 33 and would like to retire at 40. Annually can save 90-100k USD equivalent. Coach potato or Permanent portfolio? Which brokerage considering I am in HK now and will be moving to Taipei soon. and won’t be going back to Canada. I would appreciate your recommendation on the currency, portfolio and brokerage.

    Thank you.

  187. Frodo says:

    In HK, isn’t it cheaper /easier to build a global portfolio with any specific currency compared to other currencies based on what is available here through brokerages ?

  188. Heidi says:

    Dear Andrew,

    I just read your book and am considering trying to invest a bit of money. My biggest dilemma is that I am American, living in Switzerland with a modest income (not more than the Foreign Earned Income Exclusion). My bank here said they would not allow Americans to invest and I have asked with US investment firms and they say they do not allow non-residents to use their platform. Could you recommend one or two low cost brokerage platforms that accept expat Americans and do not require a fortune up-front to have an account?

    Thank you in advance for your help and the book. I believe you are updating it, but the section for Americans was a bit disappointing for me, as it does not really seem useful for Americans who have already expatriated. I have not checked extensively, but my bank here told me point blank that I could not invest because I am American. They also told my EU-citizen fiancée that it was not worth it for him to invest. We might have inadvertently dodged a bullet there given what you write about investment managers, but it is frustrating.

    • Heidi,

      I’m sorry you were disappointed with the book.

      As an American expat, you can buy the Schwab based ETFs that I mention in my book. But to do so, open an account with the firm, Interactive Brokers. They will allow you to invest with them. Once you open the account, use the Schwab ETFs that I listed in my book under the section for Americans.

      Cheers,
      Andrew

      • Heidi says:

        Thank you Andrew. I will look into it. Please consider it more of a constructive criticism. I learned a lot and will continue to look for information, but just knowing where one can even invest is a huge problem for a novice. Figuring out how to start saving for retirement, I believe your article actually brought my attention to it again. I do appreciate that you are focusing on expats – your book gives me courage and some clarity. I may be in touch again in the future!

        • Hi Heidi,

          The book, to the best of my knowledge, detailed every available option for U.S. expat investors. It mentioned opening accounts with Schwab, but that a secondary U.S. address was required: that of a brother, sister, parent would do. Schwab continues to adjust it’s “can’t invest” list. For example, six months after the book was published, it crossed Singapore-based U.S. expats off its list. The book mentioned a number of firms that would build portfolios for American expats, including Cerveling & Creveling and Index Fund Advisors. It also mentioned AssetBuilder. Vanguard (as was mentioned in the book) would not accept U.S. expats, so many resorted to lying on application forms, to do so, which I did not recommend. But I mentioned that if U.S. expats did have an account with Vanguard before leaving the U.S., they should certainly keep it open.

          It’s not the dearth of available options in my book that’s frustrating. It’s the fact that U.S. regulations have limited almost all previously available options. I do believe that you have only one option if you live in a country other than Singapore: Interactive Brokers.

          You can see, based on this article that I wrote, how account closures have been affecting Americans abroad: https://assetbuilder.com/knowledge-center/articles/american-brokerages-slam-the-door-on-us-expats

          Cheers,
          Andrew

  189. Spender says:

    Hi Andrew, please can you clarify your recommendations for trading accounts. I have read your fantastic book and am about to set up an account. (I feel now may be a good time to buy!). You’re book recommends DBS Vickers but I now see that their fee structure has possibly changed your mind. In that case, I am now thinking Saxo, as I like the look of their dashboard, although its a little daunting. Would you be recommending them or TD Direct these days? I am a 39yo British expat (dual citizen with Australia) based in Thailand. I have around 200kGBP of cash to invest and plan to start a portfolio with funds that have global, UK, European, Asian and Australian exposure. I also already have an existing Australian super annuation account that I am continuing to contribute to and own a large chunk of shares in the privately owned company I work for. Any advice appreciated. Cheers Spender

    • Spender,

      DBS Vickers has not changed is fee structure since my book was published. Saxo has changed their structure, adding fees. Plus, Saxo has a very complicated platform.

      TD Direct International is the brokerage I recommend. They reduced their fees since my book was published. It also has the cleanest platform.

      Cheers,
      Andrew

  190. Spender says:

    Andrew, thanks for the tip. Any views on my proposed portfolio split would be appreciated:
    Given my current exposure through my superannuation (14% of total net worth) and shares (31%) in my company I am considering the following proportions to my new investment portfolio:
    UK: 50%
    Global: 20%
    European: 10%
    I am 39 and my wife is 35, so I intend to split my investments 35%Bonds and 65%Stocks (ETFs). We have property and family in the Czech Republic and intend to remain global vagabonds, spending retirement split between CZ and the UK (and possibly Australia and Asia!)

    Cheers
    Graeme

    • Spender says:

      Andrew, before you comment, yes I missed 20% from my portfolio! This would be US exposure.

  191. James says:

    I read this book a while ago, but remember a link you gave in the book for TD Bank, and it was a way to set up 3 different investments in VS index Canadian index, as well as bond index. You said this method was good for beginners and provided the lowest fee’s possible.

    Can I have this link?

    • Hi James,

      I’m sorry. I don’t have a link for that. But if you check out Canadiancouchpotato.com, you can see some solid sample portfolios. As an expat, you could use the ETF portfolio.

      Cheers,
      Andrew

  192. Cedric says:

    Hi Andrew,

    Great book.
    What you shared was invaluable

    Got some questions

    1. Given that we buy into international market index fund, eg. S&P index or the likes how can be protect ourselves from the currency fluctuation that can have a impact on our returns

  193. Deborah Jones says:

    Hi Andrew,

    I am a 52 year old teacher who has been teaching overseas for 24 years. I just finished reading your book “Millionaire Teacher” and I loved it (wish I had read it earlier). I currently have a Financial Investor however I am convinced after reading your book, that it is time to invest in some index funds. I have just returned home for the summer, like many Canadians teachers do, and I am ready to invest in some index funds. You mention in your book that an investor’s portfolio should always have the home country index represented because it makes sense to keep much of your money in the currency with which you pay your bills. Even though I am non-resident of Canada, I have no bills/ties to Canada outside of family. Therefore, does this apply to me?

  194. Charlie says:

    Hello Mr Hallam,

    I’ve been running a potato portfolio for 2 years with Saxo. The first year I was down, but I’ve regained any losses this year.

    My question revolves around protection of funds. I found this on the Saxo site and it does not fill me with a lot of confidence.

    “Protection of retail client funds
    In the event that a Danish bank (including Saxo Bank) should suspend its payments or go into bankruptcy, client deposits are guaranteed by the Fund with up to EUR 100,000 for cash deposits. Cash deposits are calculated as the net free deposit after deduction of any debt to the bank.

    As a general rule, securities will not be affected by the suspension of payment or compulsory winding-up and will be returned to the client. In the event that a Danish bank (including Saxo Bank) is unable to return securities held in safe-custody, administered or managed, the Guarantee Fund will cover with up to EUR 20,000 per client.”

    What are your thoughts? Is this not something to be concerned with?

    Thanks,
    Charlie

  195. Index says:

    I heard that Interactive Brokers may now offer a UK domiciled brokerage account.

    Does anyone have any experience or views about this account?

    Cheers – Mike

  196. AM says:

    Ola Andrew,

    I’ve read your book and been following your strategy for 2 years now. I recently lent your book to a friend who happens to be a banker and he was impressed. However, he did have a few questions which I was unable to answer. He is leaning towards the Permanent Portfolio.

    I hope that you can assist.

    1:
    He says that there is not enough physical Gold in the world, compared to the amount of shares of Gold ETF’s.

    2:
    He previously had an account with TD International, but they liquidated it as they could not make contact when he moved countries. What kind of protection does he/any of us have?

    3:
    How does an index portfolio fit into an overall portfolio of cash and property? Surely it would be crazy to put EVERYTHING you have into a TD/Saxo account, or is he missing something? Surely you need to diversify, much like you would within your Index Portfolio.

    Thank you.
    AM

  197. Kelly says:

    Hello Andrew,
    I’m an American currently teaching in Korea. I’ve read both your books and learned a ton. THANK YOU! Following your advice I started to open a Charles Schwab account today. As mentioned in your book I could do it as an American resident using my parent’s US address or they now have a international portion to their website that caters to US expats. Do you have any insight as to if there would be an advantage doing it one way or the other? Thanks again for all your help.

    • Hi Kelly,

      If they allow U.S. expats to use an international portal, that’s news to me. Thanks for letting me know. Would you mind trying it and getting back to me? They didn’t previously offer this to U.S. expats, just non-American expats. And for non-American expats, it was a bad idea because the exchange was U.S. based, which can attract U.S. estate taxes upon death for non-Americans.

      Thanks,
      Andrew

    • Hello again Kelly,

      I just sent Schwab an email. I’m curious to see what they say. Please keep me posted on what you discover.

      Cheers,
      Andrew

      • Kelly says:

        Andrew,
        Schwab rep #1 said there was little difference between the domestic & international accounts. He advised me to open a domestic account and with my US address. Because an international account allowed for free international wire transfers, I decided to go with an international account. It was an easy10 minuted to complete the paperwork. The account was suppose to be up and running in less than 48 hours. 48 hours later I was notified by Schwab rep #2 the account couldn’t be opened because I work in Korea and it’s on the OFAC list.

        I looked up the OFAC list, it contains North Korea but not South. I called Schwab, rep #3 agreed I should be okay but my paperwork had been moved to inactive and couldn’t be accessed. He advised I do new paperwork and to speed things up, sign up for a domestic account and register as unemployed. I’ll let you know if it goes through or not.

        • Hi Kelly,

          I’ve stopped recommending Schwab because their “can’t play” country list appears to change all the time. When I wrote my expat book, it was OK for Americans to invest from Singapore using Schwab. That’s no longer the case. If you don’t want any hassles at all, use a brokerage that specializes and encourages U.S. expats to use them: Interactive Brokers. You can use them from anywhere. And they won’t muck you about with inconsistencies. https://www.interactivebrokers.com/en/home.php

          • Kelly says:

            I’m up and running with Schwab. But I’ll keep Interactive Brokers in mind for the future if needed. Thanks again for your books and all your help.

  198. Vaughan says:

    Hi Andrew,

    I’m a Canadian Expat and about ready to switch over to your suggested portfolio from your latest book. After your article on Horizon ETFs, I have weighed the risks and decided to buy them (HXS and HXT) instead of comparable Vanguard. I notice that I can also buy them in US currency (HXS-U and HXT-U). I get paid in USD so is there any difference in buying the -U ETFs instead of the CAD ones?

    Also when looking at the charts of the -U ETFs on Yahoo Finance, there isn’t any, but HXS and HXT can be found? Is there a reason for this? Should I just look at the CAD ones?

    Thanks!

  199. Bonita says:

    Hi Andrew
    Thanks so much for all the great advice you give. I’m a British expat living in Malaysia. Do you know how I could buy stocks and bonds from here? Could I set up a brokerage in Malaysia or Singapore? Many thanks.

  200. Mostafa says:

    Hi Andrew,

    great Job with the book and the blog ; it’s very informative.

    i’m a resident of the middleeast and i’m facing the problem of not being able to find access to global low cost indexes and mutual funds like a person living in North America for example ; also very few american companies would allow me to open an account.

    do you have any advice on this issue ?

    Thanks a lot,
    Mostafa

    • Mostafa,

      My book, The Global Expatriates Guide To Investing explains how people can build portfolios of ETF from the middle east.
      Cheers,
      Andrew

    • Jen says:

      I was resident in Qatar for 10 yr’s, before this UAE and Saudi. I opened with Saxo (by emailing the Dubai branch). It was easy and painless. (Althu one has to learn how to use the platform-not too hard)

  201. Mostafa says:

    thanks Andrew

  202. Mokhtar says:

    Hi Andrew, just finished the Millionaire Teacher book. It was great. I am in my 30s and getting ready to invest, but i noticed that in your book, you talk about Bond yields of 3-5%. I live in Canada and just check current canadian bond yields which say something like 0.57% for a 1 year bond if i am reading it correctly. So would you still recommend using the bond-Index strategy ratio based on your age when Bond yields are so low? This is confusing as my savings account interest says its an annual rate of 0.80%, which is more then a bond rate. Any input would be appreciated.

    • Hi Mokhtar,

      I can’t recall mentioning specific bond yields in the book.

      That said, there’s more to the rebalancing process than actual bond yields. When stocks rise strongly, bond prices often fall. When stocks fall, bond prices often rise. This provides juice for rebalancing, over time.

      To answer your question, the process of diversifying and rebalancing between stock and bond index funds is timeless, regardless of current yields. I’ve just completed the manuscript for my book’s next edition. New products are available. But the process is timeless.

      Cheers,
      Andrew

  203. Sam says:

    Hi Andrew,
    I recently read your books and have decided to invest according to the permanent portfolio. I am a Brit living in the middle east. Have always put my money in property but the books have been real eye openers. I am in process of opening accounts with TD, Saxo and also through HSBC expat’s platform. I wanted to ask since when you wrote the books have there been any ETF’s worth considering instead of the cash position in the permanent portfolio? Also – which factors in the market would make you increase your cash position?
    Many thanks.
    Sam

  204. Sam says:

    Hi Andrew,
    In describing the permanent portfolio for British Expat you mention iShares UK Gilts 0-5 ur. UCITS as the long term bond exposure. Are there any other longer term bond ETF’s you would consider like Vanguard U.K. Gilt UCITS ETF (GBP) | VGOV or SPDR Barclays 15+ Year Gilt UCITS ETF (GBP) | GLTL ? These appear to offer exposure to bonds of longer term.?
    Would you share your most up to date ETF considerations for british global expat permanent portfolio?
    Many thanks again,
    Sam

    • Hi Sam,

      I think the ETFs I listed would work well, as would the others you suggest. I’m not going to update a list because I believe that’s splitting hairs.

      Cheers,
      Andrew

      • Sam says:

        Thanks Andrew. Any suggestions for ETF’s instead of the cash position in the permanent portfolio? At the time of the book you had said none were yet available but that could change.
        Regards,
        Sam

  205. AM says:

    Ola Andrew,

    I’ve read your book and been following your strategy for 2 years now. I recently lent your book to a friend who happens to be a banker and he was impressed. However, he did have a few questions which I was unable to answer. He is leaning towards the Permanent Portfolio.

    I hope that you can assist.

    1:
    He says that there is not enough physical Gold in the world, compared to the amount of shares of Gold ETF’s.

    2:
    He previously had an account with TD International, but they liquidated it as they could not make contact when he moved countries. What kind of protection does he/any of us have?

    3:
    How does an index portfolio fit into an overall portfolio of cash and property? Surely it would be crazy to put EVERYTHING you have into a TD/Saxo account, or is he missing something? Surely you need to diversify, much like you would within your Index Portfolio.

    Thank you.
    AM

    • Hi AM,

      Your friend is right about the ETFs–sort of. But he may not understand how these ETFs work. There are two types: those that actually own and track physical gold, and those that simply track the price of gold. We call the first type Physical. The second type are called Synthetic or Swap based ETFs. The synthetic products are like promissory notes. A third party bank is promising you the value of gold, but the product doesn’t own any gold. So trading activity doesn’t matter at all with these products. Every investor in the world could sell the synthetic bond ETFs tomorrow and it wouldn’t change the value of them. However, if every investor in the world sold the physical gold ETFs, it would crash the price of gold (supply and demand) therefore crashing the price of the synthetic gold ETFs as well.

      As for your question about protection, I’m a bit confused. If you’re asking whether a brokerage, such as TD, could liquidate everything after you move to a country like Indonesia, the answer is yes. However, it would still remain in cash form, and you would still have access to it. If you are afraid of this happening, don’t move to Indonesia.

      As for your third question, Warren Buffett has 99.99% of his next worth in the stock market. Until recently, I had 100% of mine in my stock and bond market portfolio. I bought a condo, which shifted that percentage, but I didn’t do so to diversify. I simply wanted a place to rest my head.

      If you want to buy real estate investments, that’s great. It diversifies you further. I don’t, however, see cash as an investment. Cash loses to inflation. It’s for emergencies only.

      Cheers,
      Andrew

  206. John Elliott says:

    Hi Andrew,

    Thanks for your books. I just purchased and read both over my summer vacation! My wife and I are Canadians and have taught internationally now for 7 years in Korea, Vietnam and currently Dubai. I have put off investing for fear of not knowing exactly how, or because of getting unclear answers about taxes. After reading your books I feel much more confident. I felt even better when a teacher I knew from Vietnam said you spoke really well and sincerely at his school this past year.

    One issue I have though is that I went, with this new found confidence, to open up an account with TD Waterhouse. Unfortunately they told us that Dubai is a high risk country (?) so they wouldn’t open us an account. It kind of put a damper on my enthusiasm as I was ready to set up my index funds in the way you laid out.

    Is there anywhere on this site that advises where Canadian expats in Dubai can open an account, since it would be tough for us to make it to Singapore this year. Have other Dubai expats run into this “high risk” problem? Also, it will probably be our last year in Dubai, would we need to switch accounts once we more, or stop adding to that account?

    Even if I don’t get an answer, thank you for your books. Well worth the money and I appreciate what you are doing for us expats.

    Kind regards,

    John

  207. Barry says:

    Hi Andrew, finished up reading Millionaire Teacher this summer and started reading Global Expatriate’s Guide to Investing… both are wonderful reads! Recommended both to a small group of friends at our international school in Shanghai.

    I’m at a crossroads with out current financial advisor of over 15 years as fees are going up (from 1% to 1.7%) and I’ve got the itch to invest our retirement savings myself.

    Can you please explain to me the best approach I should take to move on from our advisor? My wife and I each have traditional IRA (Fidelity) and Roth IRA (Putnam) accounts containing a slew of mutual funds valued at just over $500K. I’ve got accounts with TD Ameritrade and Interactive Brokers so do I just fill out the Transfer of Assets form or should I be trying to just remove the advisor from our accounts and let the money sit in Putnam and Fidelity?

    I don’t want to mess this up so looking forward to your advice!

    Thanks for opening our eyes to the joys of investing.
    Barry

    • Hi Barry,

      You could leave the money with Fidelity, but remove the advisor. Fidelity offers the Spartan index series of funds. You could simply swap (without paying a fee) the actively managed funds for those Fidelity products. They are just as cheap as Vanguard’s. Here’s a link to them. https://www.fidelity.com/mutual-funds/fidelity-funds/why-index-funds

      You could then transfer your Putnam assets to Fidelity, if you want to do that.

      As an expat, you likely can’t add money to your IRA (unless your salary exceeds about $102,000 USD) so you’ll have to invest the remainder in a non IRA, such as what you could do via Interactive Brokers. Just be aware that TD Ameritrade could shut you down. They did that with expats living in Thailand recently. But IB is more set up to take and accept expat clients (they encourage it, in fact) so I would send newly saved money to that account.

      And if you have a couple of minutes, and you wouldn’t mind posting a review of my book on Amazon, that would be super! http://bit.ly/globalexpat
      Thanks,
      Andrew

  208. Mike says:

    Hi Andrew,
    O.K., so I’ve read your books and want to make the move to Vanguard. We tried to fill-in the online application but it required our employers address, which pops-up when you indicate you’re employed, but it won’t accept the address because it is foreign. We spoke to one of their representative on the phone and they suggested that we mail in the paper copy of the application. My question is this: Will Vanguard accept our application knowing we have an overseas employers? Does it matter? Or should we just click the Unemployed box so we don’t have to provide an employer.
    Thanks for the advice.
    Mike

    • Hi Mike,

      As I mentioned in my expat book on page 206, you won’t be able to open a Vanguard account as an American who lives overseas. But you’ll see available options if you read the rest of that chapter.

      Cheers,
      Andrew

  209. Ian Storey says:

    Hi Andrew,

    Firstly I would like to thank you for writing Millionaire teacher and The Global Expatriate’s Guide to investing, they are a great read and well detailed.

    I am a British teacher in the Philippines with the eventual plan to move back to the UK and work (not sure exactly when this will be), with a high possibility of moving to teach in the UAE or Qatar before going back to the UK.
    What are the implications of having an offshore account with Saxo Capital Markets when we more back to the UK?
    I am not sure if it best to open one in Singapore or the UAE, what are the differences?

    Thank you

    Ian

  210. Alexander Bunting says:

    Hi Andrew,

    Based on your book and asking questions here, in May I started investing using interactive brokers. I am British so invested in ftse 100 vuke, a world index, vwrl and British bonds, vgov.

    I am pretty happy with this in general, but post brexit these stocks are all flying upwards! I get paid in USD so the weak pound is great for me, but your advise is to invest in the weaker fund. Do you have any advise for what to do when all of my funds are doing really well? I put some into VMid which follows the ftse 250 and is not doing as well at the ftse 100 but it’s still doing the best it ever has!

    Thanks so much,
    Alex

    • toony says:

      Alexander,
      The ETFs you have chosen are all great choices and I’m a fan of IB too 🙂

      With new funds, add it to lagging funds according to YOUR asset allocation – market pushing everything all up/down at same time is irrelevant!

      If all funds similar value, you can either:
      a) split the new funds in 1/3 each, or
      b) add to 1 fund this month, 2nd fund next month and 3rd fund month after to balance things out

  211. Mike says:

    Hi Andrew,
    Thanks for the reply.
    A new couple in their early 30’s have just started at our school. I’ve lent them both your books after they told me they presently invest with one of the mutual fund companies that make the rounds of international schools.
    Thanks as well for this website. It’s filled with heaps of valuable information and situations different expat couples find themselves in. Which brings me to my latest query.
    Although I’m Canadian I can’t see myself ever returning. In fact if my wife (American) and I ever do move home it will likely be to the United States to put our kids through mid-high school or as retirees, in which case we would likely only spend a portion of our time there. We’re fairly addicted to the expat lifestyle.
    In this case does it matter if I put my money through TD Waterhouse or would I be better off with TD International? In your book TD Waterhouse outperforms TD International considerably.
    Q2: In order to simplify things, would it be a good idea for my wife and I to open a joint account with TD International or Interactive Brokers.
    Q3: We realise that if we go with Interactive Brokers there is a chance our heirs will have to pay US Estate Tax, but after checking the IRS website it states only estates with 5.6 mill or above incur this tax. Do I have this right.

    Thanks again for your books and this site. It has help us take control of our retirement future.

  212. Nuno Brandão says:

    Dear Andrew,

    I decided to move forward with a PERMANENT PORTFOLIO strategy as per below:

    35% IHCB.AX – iShares Global Corporate Bond ETF;
    10% VTS.AX – Vanguard US Total Market;
    15% VEU.AX – Vanguard FTSE All World ex US Index Fund Investor Shares;
    25% QAU.AX – BetaShares Gold Bullion ETF;
    15% CASH – liquid cash;

    I implemented the portfolio with success through my current bank, but the reason which i shifted the weights are the doubts on which i really need your opinion:

    a. the IHCB.AX has a weightned maturity of aprox. 9 years (as per the prospect info) and being those short maturity corporate bonds i decided to allocate 35% to BONDS and 15% to CASH hoping to emulate a higher maturity for the component BONDS+CASH compensating the short maturity for the IHCB. Am i proceeding correctly?

    b. since the VEU.AX represent such a big amount of countries that goes through Asia, Europe, Africa and South America, i would like to ask you if putting a little bit more weight on it (15%) would not help to balance the risk? still maintaining VTS+VEU with 25% of the portfolio??

    Many thanks in advance for your feedback and guidance!
    Nuno Brandão

  213. Mark says:

    Hi Andrew,

    I’ll try to keep this as brief as possible.

    There are many comments that the market may correct soon largely because;

    1) There’s an all time record level of margin share buying – and if the market corrects these margin buyers will sell fast.
    2) Firms have been buying their own shares (because credit is so cheap) and the P/E ratios are therefore a product of financial engineering.

    So….

    100,000 GBP in VUKE can be “insured” for 95 days for around 1000 GBP by purchasing a put option. If the market crashes (by more than around 4%) then you are covered; if it rises you have lost your premium (but gained with the market and you are still getting dividends that cover the cost of the premium).

    Do you consider this to be a good idea?

    or

    Do you recommend- just stick with the balance of stocks and bonds as outlined in your book?

    Shifting to bonds is another option – but bond prices are also very high in the UK.

    Thanks in anticipation.

    Best wishes,

    Mark

    • toony says:

      Mark,
      Andrew only advocates ‘buy and hold’ index funds. What you have described is a mixture of speculation and market timing, something that is mathematically GUARANTEED to underperform everyone that follows what Andrew describes!

      Speculation/market timing is a “zero sum game” (aka loser’s game) hence Andrew (and myself) would NEVER recommend

  214. Chloe Coles says:

    Hi Andrew,

    Thanks again for coming to Muscat, really appreciated it. Read your book this summer and can’t recommend it enough- have spread the word!

    I’m in the process of ‘Friends Provident damage control’. After 3 years my policy is worth $14,393 (36 monthly payments of 2,000 AED) . My maximum withdrawal value is $4,456. My surrender value is $5,444.

    Your book and your blog recommend taking the maximum withdrawal and then reinvesting the remaining amount in your recommended funds. However, looking at the monthly/quarterly/annual charges that I would incur over 22 years on the remaining amount:

    1) 1.5% charged quarterly for duration of the plan which is charged on the initial unit
    2) Annual fund administration 1.2% charge- charged on the value of the policy (this will fluctuate depending on market performance)
    3) 6USD monthly plan charge
    4) Fund charges – 0.1% – 3.35% dependant on fund choice

    Would I have anything left? Is it worth just cutting my losses and taking the full surrender?

    Your advice would be most welcome.

    Many thanks

    Chloe Coles (UK teacher in Oman)

    • toony says:

      Chloe,
      You have a very clear cut decision to make!

      FPI has many hidden clauses to protect them at their client’s expenses. You currently have two choices:
      a) Full surrender – $5,444
      b) Max withdrawal – $4,456
      This difference of 1k represents 2 years worth of account fees for FPI (ie all the hidden and know fees apart from the funds fees). There’s a clause in the policy for them to close account if you freeze payment for >24 months (to stop ppl pausing indefinitely till contract expires). If don’t withdrawal max amount, they keep account going until it reaches $0 – ie. bleed you dry!!!

      Andrew has to stay neutral but I don’t. Do you want an extra $1k to invest in your portfolio for your benefit or prefer to give it to FPI instead? 😉

      The maths is very clear – full surrender asap and get the remaining money into a well diversified, low cost, index portfolio as described by Andrew.

      Good luck

  215. Jorge says:

    Hi Andrew,

    What do you think of the idea of selling all investments due to the volatility coming from the US election? We often see pro investors like Warren Buffett go all into cash particularly during these times.

    • Jorg,

      Nobody has ever seen Warren Buffett sell investments based on a forecast or political circumstance. His favorite holding period, as he says, is forever. He still owns many of the same stocks that he bought 40 years ago. He has never sold them.

  216. Sean says:

    Hi Andrew,

    Just finished reading your latest book and wanted to say thanks for putting such a comprehensive resource together! As a Canadian about to relocate to Denmark it’s been an agonizing process of navigating the waters of finance, managing current portfolios, looking at new ones etc. I had one question which is since Denmark has a relatively high capital gains tax what’s your view on using swap-based ETF’s like HBB, HXS, and HXT? I’m preparing to assemble a self-managed portfolio based on the recommendations in your book but don’t have the benefit in residing in a country that doesn’t have capital-gains. I’ve got an existing RRSP and TFSA that I plan to just leave parked where they are and continue to grow but need an alternate investment vehicle once I leave Canada.

    One last question I had is do you suggest TD DI mostly as a means of dodging any potential for the CRA to deem you a factual resident? Since I’m keeping my TFSA, and RRSP accounts I’d pondered just opening a Questrade account before I leave and then filing the non-resident forms but don’t want to trigger the CRA since I’d have three or four accounts still in Canada.

    Thanks!

    Sean

  217. Terry says:

    Hi Andrew,

    I read your book a while back and I’ve been trying to get into the investment game for awhile but with the mountains of information and billions of acronyms I end of getting more confused and frustrated.

    My question is, where is the best place to get started?

    I am a (non-resident) Canadian who has been living in Korea for about 10 years now. I’d like to get a couch potato portfolio going. I’ve contacted CIBC back home and they’ll open a non-resident account for me for $100 for the year if my investment is under $10,000 (which it is). After it is over $10,000 there is no fee (apparently). I have also run across Tangerine and liked that there deposits and rebalancing are automatically set up. Of course I’ve read about Vanguard and TD in your book as well. Do you have any further insight on this and point me in the right direction?

    Also, should I get index funds in Canadian currency or US or both? I’m confused about the benefits of these. (I apologize if you’ve covered this already, feel free to link me) I was told people like US funds because of the exchange rate.

    I intend on getting a varied portfolio as recommended in your book with Index Funds and Bonds, 70/30 (the bonds will likely be Canadian, as I’ll perhaps move back some day)

    Thanks in advance for taking anytime to read this and I’m sure if you’re ever having a seminar in Korea, I’m sure I’ll be there.

    Terry

  218. RomainD2 says:

    Hi Andrew!

    I have just finish your book, and I really thank you. It was my first english book to read, and it was so fascinating that I finish it in less than two weeks!

    I have only some question about the last chapter, the 21 for me (I’m french 🙂 ). I didn’t understand why you talk about UK currencies whereas this chapter is for european expats, who have mostly euro currency. The chapter 17 is for British, so you talk about UK currency, I hoped an example with euro trade. Is it normal?

    Also, I would like to know why you advice to buy some stocks from your country, and the country where you will be retired? I didn’t find it in the book! As french person, do I need to buy some french stocks?

    Thank you!

  219. Mark says:

    Hi Andrew,

    Have just finished the Global Expat book and left as glowing a review as I could construct on Amazon UK . I’m a Brit working in Saudi Arabia for 3 years. I’m interested in your thoughts on the Vanguard LifeStrategy ETFs. These almost seem too good to be true (hence my very slight concern). They seem to take even the minimal amount of effort required to run an index portfolio and reduce it still further. My plan is to open a TD account, pick the LifeStrategy ETF most closely aligned with my desires (I’m thinking only 20% bonds as I have a government pension as back up). Is there a drawback that I’ve missed?

  220. Hi Mark,

    I don’t believe (please correct me if I’m wrong) that you can buy a Vanguard Life Strategy ETF. To my knowledge, Schwab USA will be the first company to come out with one of these next month. Vanguard UK does offer Life Strategy Funds. You won’t, however, see them mentioned in my expat book. To my knowledge, they are only available to citizens in the UK. Those citizens will have to pay UK taxes for UK domiciled brokerage accounts. And I think you need a minimum of 100,000 pounds to buy them without a broker that will charge you extra fees. That said, why not open an account with TD Direct International and buy the ETFs that I listed in the expat book? It would take you less than one hour each year.

    Cheers,
    Andrew

  221. Mark says:

    Hi Andrew

    Thanks for the reply (please ignore my reply on the 30th, I hadn’t seen your message). I’m in the process of opening a TD account so couldn’t/didn’t see what funds were available through them. The book was written a few years ago so I was wondering if you still thought your recommendations were the pick of the bunch. Obviously from your message you still think they are so I’ll gladly go with them (I didn’t doubt your recommendations but funds change/disappear/get renamed).

    Thanks again, your book/investment strategy has really taken a lot of stress out of my life, and you being so helpful on the website is the icing on the cake. I’ve already converted a friend who was investing in one of those terrible insurance deals and I can’t wait to spread the word further.

    Cheers

    Mark

    • Thanks Mark,

      Fortunately, solid ETF firms like iShares and Vanguard don’t have their shares liquidated or their fund names changed. That’s reserved for very small ETF providers, offering niche funds, and for actively managed funds that need to maintain a solid marketing profile (so they nix under-performing funds)

      I’m glad the book was helpful. The book is 20 months old. But the funds within it are timeless.

      Cheers,
      Andrew

  222. Trina says:

    Hi Andrew, I just read your book the Global Expat’s Guide to Investing; and am about to start couch potato investing. As a Philippine expat in Southeast Asia, could you recommend what markets I should purchase in – Australia, Canada, HK, Singapore? Should I look at my home country market as well, or do you think it’s too volatile? Trina

  223. Michelle says:

    Hi Andrew,

    I enjoyed your book Millionaire Teacher. I’m looking at switching my current RRSPs to ETFs in a lump-sum (with the 4-way split between bonds and Can/US/international index funds). Going forward, though, would it be better to start monthly automatic contributions to index mutual funds with the same asset allocation (TD-e series with an average of 0.42% MER between the four mutual funds), or make yearly one-lump payments to add to my ETFs (average MER of 0.18%, $10/purchase)?

    My budget’s pretty small – $300/month or $3600/year. I’m having a hard time determining if the savings from lower MER is worth what I would lose from not investing as I go, month by month. I hope that makes sense!

    I’d appreciate your thoughts – thank you!

    Michelle

    • Hi Michelle,

      Investing the smaller amounts, as soon as you have the money, would give you statistically higher profit odds.

      Cheers,
      Andrew

      • Michelle says:

        Thank you!

        Michelle

      • Rob says:

        Hi Andrew, where would say the cut off would be to make it more cost effective to place regular savings into the mutual fund rather than ETFs?

        Thanks

        • Hi Rob,

          Which mutual funds are you referring to? What’s your nationality? The answer depends on these two factors. Even an index mutual fund will be better than an actively managed mutual fund, over time.

          Cheers,
          Andrew

          • Rob says:

            I am a British expat in Dubai and am definitely only looking at passive investments so in this case index funds.

            Thanks very much

  224. Dun Wot says:

    Hi Andrew,
    As a 52 yr old Australian living and working in Japan with a small investment property in Australia as their only investment, would you advise setting up a Vanguard folio from Singapore, or setting up the whole thing in Australia. Following your book, I am leaning towards a Vickers DBS plan, but I can’t determine the advantages of doing it this way rather than from an Australia (or even Japan) Any clues?

  225. Greg says:

    Hi Andrew,
    Would you (or any of your loyal readers!) have some unbiased information to share on HMS Markets out of Luxembourg? Their lower fees and lack of inactivity penalties appear to make them a preferred choice to TD Direct.
    Any thoughts? Thank you.

    • RomainD2 says:

      I’m looking forward Andrew’s reply too 🙂 I just found that in France, it is better to invest on PEA whereas CTO!

  226. Philippe says:

    Hi Andrew,
    Just finished to read your 2 books, pretty clear except one question in “The Expatriate’s Guide to Investing”, chapter 21 (Investing for European Expats), I’m french and as you know most of Europe use Euro so I get confused when you recommend ETF in UK exchange to European expats, especially that there is the chapter 17 (Investing for British expat) for whom UK Exchange makes sens. I expected an example of Couch potato portfolio with ETF in Euro in European exchange, are you really advising to a french expat to invest his euro in British pound ETF in UK exchange or did I miss something? By the way, It is the same question as RomainD2 earlier Aug 25. I’d appreciate your thoughts – thank you! Philippe

    • kukok says:

      Hi Philippe, I am also european. Really interesting question. Looking forward Andrew’s reply!

    • toony says:

      Philippe & Kukok,

      The London Stock Exchange (LSE) is by far the biggest in Europe and host ETFs in different currencies. Other exchanges include the NYSE Euronext and SIX Swiss.

      For a British Expat (chpt 17), you would be buying your ETFs in GBP.
      For European Expats (chpt 21), your purchase would be in local currency of EUR.

      All you have to do is purchase your couch-potato portfolio in the relevant currency (don’t mix the currency to avoid conversion costs!) The same ETFs on the LSE are often avail in different currencies – GBP, US, EUR, CHF, etc

      ETF Fact sheet will tell you what currencies the ETFs are avail in, their ticker and where you can buy them.

      EG. FTSE all world is avail as:
      VWRL (GBP) and as VWRD (USD) on the LSE,
      VWRL (EUR) on the NYSE Euronext exchange
      VWRL (CHF) on the SIX Swiss exchange

      Lets say you wanted a 2 fund couch potato portfolio of global stocks and gov bonds
      a) British person would buy:
      – VWRL on the LSE
      – SGLO on LSE

      b) European person (EUR) would buy:
      – VWRL on the NYSE Euronext or IWDE on the LSE
      – IEGX on the LSE
      (Philippe & Kikok, this would be your option)

      c) International person (USD) would buy:
      – VWRD on the LSE
      – IGLO on the LSE

      d) Swiss person (CHF) would buy:
      – VWRL on the SIX Swiss exchange
      – GHYC on the LSE

      That’s all there is to do 🙂 As the name suggest, keep your portfolio simple and lazy!

      • kukok says:

        Many Thanks for this reply toony.
        Is NYSE Euronext dangerous? since NYSE Amsterdam is an arm of NYSE US, will our heirs have to pay U.S. estate taxes?
        ALso it seems that ETFs mentioned above from the NYSE Euronext have higher expense ratios. is that the ‘price’ we have to pay to build a portfolio in euros?

        Thanks

        • toony says:

          Euronext exchange has no impact regards to US estate taxes – it’s related to where the individual funds are domiciled, not the exchange you buy them off.

          Haven’t build an EUR portfolio before (only USD/CAN/AUS/GBP) so took another look – several new ETFs addition by Vanguard recently.

          A strong 2 fund portfolio would be:
          – VWRL All world, 0.25% (or VEVE developed world, 0.18%), domiciled Ireland, NYSE Euronext. (I prefer VWRL)
          – VETY Euro Gov Bond, 0.12% Ireland on Euronext

          If you wanted a home bias, the 3 fund portfolio would include:
          – VEUR Developed Europe, 0.12%, Ireland, Euronext

          Make sure you read chapter 21 again to see other types of portfolios that may suit you better.

          • kukok says:

            Dear Toony,

            Thanks to you I am now more confident in building a portfolio in Euros. Thanks

            One more thing. VETY is 0.12% and IEGX 0.2%, ok. but IEGX is a 3-5yr bond whereas VETY is 10y. Andrew recommends shorter bonds. Why did you change your bond pick for VETY on your second post?

            (btw, VETY is not available through SAXO SG, so I have no option to buy it.)

            Also, VWRL 50% US+25% Europe+25%rest of the world. Why would I need to buy VEUR to have a home bias if I already own 25% European?

            Once again, my hat off to you

          • toony says:

            Kukok,

            I missed VETY with the brief scan first time round (new fund just launched in Feb 2016). I believe the differences in short/intermediate bonds are negligible/academic when you “buy & hold” over a long period of time ie. it’s priced in already. Given this fact, the lower cost option should be first port of call (hence Vanguard’s VETY). Give Saxo a call – they may be able to add the newer VETY as an option for you 🙂

            Explaining advantages of home bias in couple of paragraphs is tough! Reread Andrew’s book for more details (colleague currently has my copy so can’t give you page ref). Here goes:

            1. We assume market efficient in medium/long term
            2. Different asset types (eg. dom eq/int eq/dom bonds/int bonds etc) should have similar expected returns when standardize against risk/volitility.
            3. Risk(volitility) & expenses for int > dom, due to currency fluctuation and conversion/hedging costs.
            4. However, diversification benefits (the only ‘free lunch’ for equities) to the portfolio outweighs this cost, up to a point.
            5. Some countries like Australia gives additional tax benefits -> hence home bias.

            VWRL is world market cap for developed/emerging countries. Home bias is not needed unless you can see direct benefit. I’m not sure of the tax laws of your home country and personal circumstances so totally up to you whether you go 2-fund or 3-fund 🙂

  227. Alan says:

    Hi Andrew,
    I would like to THANK YOU for writing this great book: “The Expatriate’s Guide to Investing”. I am Expat in Indonesia and I have been approached many times by Devere Group or others entities which are providing similar offer.
    I am planning to open an account at TD Direct investing; and clearly I have similar question as Philippe or RomainD2. I will be very interested on an example of couch potato portfolio with ETF in Euro in European exchange.
    I look forward to hearing from you.
    Thanks again.
    Alan

    • Jennilea Hortop says:

      Hello!
      I have also read both of your great books Andrew. As a non-resident Canadian who got stuck with a high paying retirement account. I am looking for options. I live in Thailand, not sure where to retire but am 32.

      I have a question about interactive brokers. Can anyone set up this account or do you need someone to help you? I have a quote from a financial advisor working for http://www.parkerbilham.com/homepage/about/ who will help me for 500USD.

      Can anyone give me some tips on interactive brokers and the fees associate with this type of account? Does it make sense to invest 2000k a month or wait and do the investment semi annually?
      Thanks so much!

      • Jennilea,

        In my book, I suggested that non-Americans might want to bypass Interactive Brokers. I don’t have the book with me, but if you check out the firm in the index, you’ll see my suggestions. I suggest TD Direct International instead. That’s the brokerage I use.

        If you want to use IB, Mark Zoril will likely help you for $96. His firm is called PlanVision. He’s very familiar with IB.

        Cheers,
        Andrew

        • Jennilea says:

          Thanks for the reply! I am living in Thailand. Can I set up TD international as a non resident?

          As I have a td account in Canada, but do not keep much money in there.

          Thanks!

      • Alexander says:

        Hey Jennilea,

        I use Interactive Brokers and set the whole thing up myself… it appears to be working for me. I recommend downloading their software and practicing for a month or so before investing, but I now find it quite simplistic to do what Andres book says.

        Im finding it fine so far. I tried to sign up for TD Direct but they didn’t like where I lived. Then I asked them “what if I lived here”, and they also said no. Then I asked, “well where can I live?” and they told me they didn’t have a list… or that I wasn’t allowed the list or something 🙂

        Alex

  228. Jennilea says:

    Thanks Alex! I live in Thailand and am a non resident of Canada. So trying to figure out best options for ETF investments with low costs. I will look into TD international.

  229. Jordan says:

    HI Andrew,

    I have just finished reading your excellent books and found them very useful. I have given them a 5 star review on amazon 🙂

    My partner and I have started teaching ESL in Vietnam, after 10 months we will go back to the UK for 3 months, before moving to China for 1 year or 2 but then we will both move back to the uk to do our teaching post graduate for 1 year or 2 before going abroad somewhere again.

    If we open an account to invest in ETFs with TD international, when moving back to the UK and back abroad again, do we need to close and re open the accounts or can we keep them open? Would it be best to open a new account with a UK broker while in the UK or continue investing in TD if it is allowed?

    Thanks

    Jordan

    • Phil says:

      International tax and especially capital gains is complicated and you may want to take professional advice if you’ve saved a significant amount.
      But, for what its worth, try not to close accounts when you move as you’ll pay transaction costs either selling and buying or transferring ETFs.
      That said if I was moving temporarily to the UK AND had a lot to save I would open an ISA for the tax benefits and keep TD parked until I went overseas again.

  230. Adam says:

    any view on new TD Direct charges in operation from October 1st – I recently set up with them and am about to deposit a reasonable size sum… Are they still the recommended lowest cost (fees) provider? link below.

    http://int.tddirectinvesting.com/sites/default/files/new_rate_card_en.pdf

    Thanks
    Adam

  231. Nuno Brandao says:

    Dear Andrew and all,

    I implemented a Permanent Portfolio strategy with success through my current bank, as per below:

    35% IHCB.AX – iShares Global Corporate Bond ETF;
    10% VTS.AX – Vanguard US Total Market;
    15% VEU.AX – Vanguard FTSE All World ex US Index Fund Investor Shares;
    25% QAU.AX – BetaShares Gold Bullion ETF;
    15% CASH – liquid cash;

    I know this contradicts the 25% philosophy but the options (brokers and banks) that i had to build an efficient were limited so i shifted the percentages based on the Craig’s Rowland literature on the Permanent Portfolio mentioned on Andrew’s book, using the ETFs that i could as per below:

    a. the IHCB.AX has a weighted maturity of approx. 9 years (as per the prospect info) and being those short maturity corporate bonds i decided to allocate 35% to BONDS and 15% to CASH hoping to emulate a higher maturity for the component BONDS+CASH compensating the short maturity for the IHCB. Am i proceeding correctly?

    b. since the VEU.AX represent such a big amount of countries that goes through Asia, Europe, Africa and South America, i would like to ask you if putting a little bit more weight on it (15%) would not help to balance the risk? still maintaining VTS+VEU with 25% of the portfolio??

    Am I pointing in the right direction? Or should I convert this portfolio into a Couch Potato?

    Many thanks in advance.
    Nuno Brandão

  232. Rob says:

    Hi Andrew

    I am just about to get your books (taking a while to clear Dubai customs) and I would like to check your thoughts as I am keen to start investing asap.

    I have just bought a house so not much to put down up front but I want to save roughly 500 pounds a month to start. Is this enough to make EFTs (TD account) worth it? If so, should I be investing every month or maybe every 3 months due to fees? Or should i look at a different approach.

    We should be saving more, in 5 years or so, once my wife goes back to work full time, if that makes a difference.

    Thanks very much

    Rob

  233. Kajorn (Mai) says:

    Thailand National- Permanent Portfolio

    Hello Andrew
    I cannit find a portfolio for Thai, so looked at the Indonesia PP.
    I have some high cost mutual funds with my Bank I will close in. Please could you suggest your thought on the following portfolio.
    I am 35 have $70,000 USD in Thai Baht and may have some money spare at the end of each year. I have and will keep a Gold Fund as it is low cost

    International:
    25% USD VWRD: LN 0.25% USD

    Bond:
    25% – IGLO: LN 0.2% or SPDR SG9999900226 PAN ASIA 0.19% SG
    or ABF PAN ASIA HK 2821 0.19%

    SET Thailand – Thai baht
    25% BCAP MSCI Thai 0.65% (FE Fee 0.125%) or TDEX50 0.51%

    Bond:
    25% ABFTH 0.11%

    1. Are any of these ok do you suggest any others and do I have the % too high would 30% Bond split / 70% Equity be better?

    2. Or should I keep it simple and just chose 30% International Bond and Equity. I see your comment on buying milk and bread (Som Tam) in the future.

    2. Should I Baht Cost Average at $5000 a month until all put in to the ETFs then if market fall this period add to the Equities?

    3. balancing do I look at the values of each fund and calculate base currency like THB on the day exchange. Then look at the % of each sell to add into or have money add in the lowest ones to maintain the target. I see you suggest +/- 10% below no need

    Thank you
    KJ

  234. Mark says:

    Hi Andrew, thank for the great book “The Global Expats” I just wish I had read it a few years ago when you released your Millionaire Teacher. I guess better late than never!

    My big concern is with the current market situation where the central bankers seven years of debt and failed policy are likely to continue for what looks like , interest rates will remain low for a long time – in which case, stock and bond prices might stay high a while longer.

    In your experienced opinion taking into account the ZIRP policies that have been in place since 2009 defy almost 5000 years of financial history – what is your take on this important issue in today’s financial markets and whether one should be concerned while following many of the strategies you provide your books ?

    Thanks
    Mark

    I have been holding a handful of blue chip TSX and FTSE100 dividend stocks in my TFSA and my UK ISA accounts for a few years but I am finding it hard to keep track of it and don’t quite like the idea and was thinking of selling most of the stocks which are in profit and create a permanent portfolio.

    • Hi Mark,

      Most investors don’t do well because they look for how a “policy de jour” or a “current political climate” will affect stocks or bonds. They then try to adjust their money accordingly. Your time horizon is your lifetime. You’ll have money in the markets until the day you die. Upon retirement, you’ll draw parts of that portfolio. That means many policies and economic climates will come and go: much as they have done over the past 100 years. Men, typically, ask questions such as you did. It’s part of our makeup. It’s one of the reasons women investors typically do better (they rarely concern themselves with such things). I hope this explains my answer to your question. It may not satisfy you. But you need to stay the course. Build and maintain a diversified portfolio of index funds. Ignore the media. Then you’ll do well over the next 30,40 or 50 year periods.

      Cheers,
      Andrew

      • Mark says:

        Hi Andrew,
        Thank you so much for your reply. Yes you are right, I have predominantly been very cautious about how the stock and generally the financial market operates and you have rightly mentioned in your books. I am now in my mid-50’s with no defined pensions and over the years I didn’t have much in free cash whatever I did have I always tried to pay off extra towards my home mortgage. I sold the house when I moved to BC – Canada and have been renting for nearly 4yrs (Vancouver bubble) but I am not quite sure where I might retire i.e Canada, UK or some lower cost Eastern Asian countries. It dawned on me that I paying someone’s mortgage while my savings are producing a paltry amount with the ZIRP polices that have been with us for nearly 8yrs and counting. So I set off to get myself informed by reading up on investing and I came across your two books and I must admit I regret not having done this 20 years ago – I suppose there was no necessity so I am of the opinion it is better late than never!

        After reading your books it made sense to me on all levels so I have just switched the cash holdings in my TFSA and my aim is to start paying into 3 pots made up of 60% ZFL 20% VCN and 20% VSB – Is this a good mix for a 55yro who has currently no assets, no debt nor any defined pension? Or I should reduce ZFL down to 20% and VSB up to 40% and add a 4th pot for 20% XAW?

        Would you also recommend to have a similar allocation for my spousal holdings?

        I am at a point to do something similar for my ISA UK accounts but haven’t been able to decide how to go splitting the bond and stock to include FTSE plus a Global index.

        Thanks,
        Mark

        • Hi Mark,

          Maintaining about 40% in VSB would give you a sweet spot: stability but not enough bonds to hinder overall growth. That’s my personal allocation. And I will keep it as such, even as I age (I’m 46).

          Cheers,
          Andrew

          • Mark says:

            Hi Andrew,
            Thanks for your note on the VSB allocation. I would like to know if I should some diversification because the Canadian stocks is only resources and financial services so I would like to consider having a Global index in my portfolio? I was trying to decide on whether to go with XWD or XAW which one would you recommend.

            Similarly, although you have provided the a selection of indexes for British Expats in your books as well as your blog – I would like your advise on the best allocation for my UK ISA for a 53yo and only eligible to receive basic UK state pension if I decide to retire in the UK around 2028-2030.
            Cheers,
            Mark

  235. Conservative Investor says:

    Andrew, I read Millionaire teacher in 2012 and was hooked. It made sense to me on every level. I immediately switched to a 60/40 equity/bond ETF portfolio and have been enjoying the simple ride ever since. (I just go with 60/40 and maintain it there regardless of age to keep it simple). It is no exaggeration to say that you have single-handedly guided me to more savings and earnings than anyone else in my life ever has or ever will. I have since recommended your book to many friends and family – some of whom were ready for something better, others not so much. But I keep trying!

    I do have a question that I have been thinking about for a while, though. Garth Turner in his Greater Fool blog recommends a similar approach to yours. The one main difference, though, is that he recommends that the 40% in the “safe stuff” be split equally between a bond ETF and a preferred share ETF. The idea is that whatever happens in the markets or with interest rates, you’ll always be collecting those dividends. I think this strikes a chord with me because of interest rate risk. While my 60% equity portion is diversified across thousands of Canadian, American and global companies, the 40% bond portion has one very large threat – that of rising interest rates whenever they do eventually go up.

    What are your thoughts on this? Am I over-thinking this?

    Thanks again for everything!.

    • I recommend a short term bond market index, something like VSB. It will beat inflation over time, no matter what happens to bond prices because it has high turnover and new bonds replace old ones quickly. Those new bond yields and prices always reflect the latest economic climate.

      Cheers,
      Andrew

  236. Kajorn says:

    THAILAND PP
    Hello Andrew
    know you are busy
    please could you suggest on my earlier post i would really welcome your or other index investor advice on my chooses for Thai Permanent Portfolio
    thank you verm much
    Mai
    Kajorn

  237. Murray says:

    Hi Andrew,

    Firstly, brilliant website! Just 2 quick questions, as i’m an expat based in the UAE:

    1. Is AES International (in Dubai) a reputable firm to get advice on building an ETF portfolio?
    2. Is your book available here?

    Many thanks Andrew!

    • Hi Murray,

      AES International is probably the ONLY reputable firm in the Middle East. And yes, my books are available in bookstores there, and on Amazon.

      Cheers,
      Andrew

      • Murray says:

        Hi Andrew,

        I would like to have AES International in Dubai build me a portfolio of index funds. Did I read correctly that I need to put down a minimum of $75,000 upfront?

        Apologies if I misunderstood.

        Kind regards,
        Murray

        • Hi Murray,

          Yes, if you invest with AES International, you’ll need to save up $75,000 USD (or its equivalent) before you start.
          If, however, you invest on your own (DIY) you can do so effectively with just a few thousand dollars using TD Direct International, in Luxembourg.

          Cheers,
          Andrew

  238. David says:

    Hi Andrew…

    Just a question in relation to the companies within an index fund…

    Obviously when buying an index funds we cant decide on what to own. Now 99% of the stocks I’m happy to own but I noticed where was one company which was a tobacco company called ‘British American tobacco’. that I’m pretty sure is part of my global index. Now if I was a stock picker I wouldn’t even look at this let alone own it, but it just so happens I do own it. With over 1500 companies in my global index there was bound to be some companies I don’t particularly like.

    So my question is this: What is your perspective with the companies you own within your index funds? Also, are their any companies you don’t like within your index fund and how do you personally handle this?

    MANY Thanks Andrew

    David
    Melbourne Australia
    (I own 3 different index funds 1-home country 2-global 3-bonds.)

    • Hi David,

      There are more than 7000 companies combined in my portfolio of index funds. I’m sure there a few that I wouldn’t like. But unless I’m going to do my own stock picking or buy a socially responsible fund with my exact set of ethics (everyone’s decision on what’s ethical is slightly different, so socially responsible funds don’t always cut it) then I have to shrug my shoulders and go with the flow.

      Cheers,

      Andrew

  239. Natalia says:

    Hi Andrew,

    I have just devoured both of your books and keen to start but need quick clarification. I’m 39, Canadian citizen and recently became a British citizen (likely to retire in UK). Regarding the Platform: Should I use one of the overseas ones (DBS or TD) or one in the UK? And if you recommend an overseas one – should I apply as a Canadian or British citizen.

    Many thanks,
    Natalia

    • Hi Natalia,

      If you now live in the UK, you are best off building a portfolio of your own ETFs off the London Stock Exchange or letting a firm like Nutmeg do it for you. https://www.nutmeg.com/home-0916

      Cheers,
      Andrew

      • Natalia says:

        Thanks for the quick reply. I’ve been looking at Nutmeg but thought the fee structure was a bit high. I’m happy to build my own portfolio but wondering why LSE is not mentioned as one of the platforms to use here in the UK? And would I still buy the EFTs you recommend in your “Investing for British Expats” chapter? Lastly, any advice when it comes to tax-exempt ISAs and SIPP? I know I’m asking a lot so thank you for your time.

        Take care,
        Natalia

  240. Natalia says:

    I’m likely being silly here but don’t I still need a platform, like TD Direct or Interactive Brokers, to build my portfolio off the LSE? I went on the LSE website and I don’t see anywhere where I can buy stocks directly.

    • Natalia,

      With a google search, you should find plenty of deep discount brokerages in the UK that will allow you to buy ETFs. Here’s a start: http://monevator.com/compare-uk-cheapest-online-brokers/

      Cheers,
      Andrew

      • Natalia says:

        Thank you for your patience and help. Last comment: when doing a google search on the ETFs that you recommend in the book: IGLS, VUKE & SGLN, only Hargreaves Lansdown has them available and their fees are not the greatest (middle ground). Do I then find ETFs with similar expense ratio as the ones you recommend or go with HL?

        • That’s interesting Natalia,

          Brokers don’t typically have ETFs “available”. All UK brokerages (that allow you to trade stocks) should allow access to anything and everything that trades on the London Stock Exchange. They don’t typically create lists of “can buy” and “can’t buy” stocks or ETFs. The entire exchange should be your oyster.

          Cheers,
          Andrew

  241. Ashley says:

    Hello, you said here that you could be prepared for the series 7 exam in just a few short weeks. Do you have a study guide or a study calendar on how to achieve that? I would like to be ready in about 3 weeks

  242. Murray says:

    Hi Andrew,

    A shot in the dark here, but you perhaps know of any reputable financial advisers in South Africa? Any help would be super!

    Thanks again for the amazing blog.

    • Jen says:

      Hi Murray

      Hope you don’t mind me butting in. I am South African and live overseas. I think who you choose will depend if you are South African or not. One thing-if you go with one of the big three investment houses be careful of portfolios that push that institutions own funds (my bitter experience). Satrix offers exchange trade funds such as the alsi 40-low fees. And if you are SA remember the SA premium bonds offer safe,compound rates-very attractive at currently abt 9% p.a for 5 yr’s. If you are not SA, then I,m sure Andrew will have some ideas of who to contact. For myself I also use Saxo to build a portfolio myself and they have a branch in Johannesburg.

      • Murray says:

        Hi Jen,

        Thanks so much! I am South African – would really like to chat to you further about this if possible?

        • Jen says:

          Sure. Not that I can give you advice but I can tell you what I did. In SA I have abt 1/3 of my money in the RSA retail bonds for 5yrs (mine was at abt 8% when I took them) and then I just renew when it comes up. The other 1/3 is gold debentures via absa wealth (low costs) and the other 1/3 is in Satrix ETF Also 40 (tracking the JHB stock exchange via a monthly debit order). Satrix is good because you can do a lump sum or a small monthly debit order and they reinvest your dividends. I did have a liberty policy but it underperformed earning 0.25%. I was so shocked at that performance I surrendered it. I do have an old mutual R.A and it,s doing well. However I worked in Qatar and currently live in spain(going back to the Middle East in December) and I was unhappy having only SA investments so I bought Andrew,s book and opened an account at Saxo, which is in Denmark using the Dubai branch (but as I say and checked out, they have a branch in JHB that you can email or phone). It was done very easily all online and I then year and a half ago started the couch potatoe (excluding any SA stuff because I already have it). You can also open with them with SA are allowed to send a set Amy overseas annually. This has worked well for me. All I can say–beware the salespeople and advisors of the large ones–not that they don’t have some good products, but i had a product in which the institutions own funds were used and this for my investment was not good. And take into account tax. Many people are getting caught on those tax free investments–but remember in SA you have a certain amount of interest annually that is tax free anyway and you could have taken something else with a higher interest rate and not pay tax anyway because of the allowance! So–I did my investing myself and don’t know any advisors but there probably are some out there.

          • Murray says:

            Hi Jen, thanks so much – this is brilliant advice! I really sincerely appreciate you taking the time to help me here.

  243. Sandra says:

    Hello Andrew,
    I read Millionaire Teacher in 2012 and have since been a Couch Potato investor. I am thrilled to learn that you are updating Millionaire Teacher and look forward to purchasing a copy for myself and all my family members and friends whom I have since converted to “Andrew Hallam” followers.

    I have a question that I was hoping you could assist me with. I am considering opening a short term investment portfolio (3-5 years) and wondering if you have any recommendations. I reside in Canada and my current retirement portfolio (and hubby’s and our 3 year old’s RESP) is with TD and is built on your portfolio recommendation in Millionaire Teacher.
    I am at a loss with fund selections for short term investing and the ones offered by the various banks have very high MERs.
    Thanks much for your time.

  244. Bonita says:

    Hi Andrew

    As a 40 year old British expat living in Malaysia, I have finished both of your books and have opened up an account with TDDI – thanks for all the great advice! I was just abut to purchase fundamental index portfolios in line with your advice in the second book ie; 40% UK bonds, 30% UK stocks and 30% global stocks.

    However, I have 2 questions for you before I go ahead and invest. Firstly, with the uncertainty about the effects of Brexit, would I be wise to lower the percentages invested in UK bonds and stocks? I also read an article a couple of days ago in the Daily Telegraph about Vanguard’s LifeStrategy 60 equity fund which allows you to invest in 60% global equities and 40% in global bonds. for a fee of 0.24%. Would this be a better option for me because of my worries about Brexit and the fact that I am paying 0.24% fees rather than the separate expense ratios of 0.2%, 0.5% and 0.5% on the fundamental ETFs I mention above? Thank you in advance for your help. Bonita

  245. Trina says:

    Hi Andrew, I’ve just began couch potato investing. I wish I read your books 10 years ago, as am already 50 years old. Thank you for writing these books – makes so much sense. Have purchased 3 of the ETFs that you noted in your expat guide book in the Canadian exchange. These funds were opened around 5 years ago. Is there merit in getting more newly-issued index funds? And how do you determine the expense ratios, and if they are not currency-hedged?

    • Hi Trina,

      If you found your funds in my expat book, they are not currency hedged. I only selected non-currency hedged funds in my book.
      http://bit.ly/globalexpat

      I listed the funds’ expense ratios in my book as well.

      New funds will come out all the time. That doesn’t make them better. Stick with the funds you own, through thick and thin. If you mess around, you won’t do well. If you are consistent with the funds I listed, you will see decent returns over the next 30 years (not every year, but the money will grow overall).

      Cheers,
      Andrew

  246. Julie says:

    Hi Andrew – I know it’s been said many times but your books have been an eye opener. Thank you for the continued teaching. I’m a UK citizen but with an international background so not sure where I’ll end up retiring or whether I’ll spend 50% of my time here and 50% elsewhere. I have a UK platform for my ISA but wondering if I should open a TD Direct International or Interactive Broker account for further trading outside my ISA allowance or just stick with the one platform. Thanks for your time.

    • Hi Julie,

      If you don’t live in the UK, you can avoid capital gains taxes on your investments by using a brokerage in a capital gains free jurisdiction. Don’t use Interactive Brokers. If you do (as mentioned in my book) your heirs may have to pay U.S. estate taxes when you die. TD Direct Investing, in Luxembourg, is an excellent brokerage.

      Cheers,
      Andrew

      • Julie says:

        Thanks! I currently live in the UK (age 40) and plan on staying for at least another 10 years at which point I may or may not move abroad. Would you still recommend TDDI in Luxembourg or stick with my UK based platform? Also, VWRD or VWRL – I’ve read your currency ETF article so I think I understand — but should I buy VWRD if I plan on staying in UK and VWRL if I plan on moving elsewhere to avoid the currency conversion or am I just complicating things?

  247. Trina says:

    Hi Andrew, I believe Saxo in Singapore holds its accounts in Custodian accounts vs. CDP. In the unlikely event that the firm fails and liquidates, are our investments with Saxo safe? Thanks. Trina

  248. Mark says:

    Hi Mark,
    I am contemplating to sale my individual FTSE100 shares held in my ISA account (the ones which are in profit – many are in a loss) and follow your strategy. As for holding an ETF pot for long term bonds i.e. what are your thoughts on the present situation with the GBP currency wars and as a result the CPI is more than likely to start rising – in your experienced view what would you advise I should do in terms the % allocation for holding Short Term and Long Term ETF’s and I know you have suggested a handful of ETF’s in your books but wanted to know if you might have a different list of ETF’s. Last but not least in the uncertain times we are in and inflation could rise do you advice on holding a Gold ETF and if so which ones would you recommend? BTW I am a 55 yro living in Canada. Thanks Mark

    • Hi Mark,

      You ask about “uncertain times.” This tells me that you are new to investing. There have never been “certain times.”
      I recommend that you build a portfolio of ETFs, such as what I suggested in my book.
      Once you have done that, stop letting the media and economic forecasts push you from that platform.

      Cheers,
      Andrew

  249. Tanya Renner says:

    Hi Andrew,

    I’m in the UK and really stuck with the first hurdle….I understand what you have said in your book but get so confused with how to open the accounts! On vanguard it seems I need a minimum £100000 investment – I’m 40 years old, with no savings and debts I should clear in the next year. So I need a way of opening the accounts with very little savings…. I’m just so confused as have never invested before and get panicked that everyone seems to find this step so easy! Is it not possible for me to go through Vanguard with no savings? Or do I have to go through someone like HSBC???? Could anyone recommend a way I could get started?

  250. Tanya,

    If you have never invested before and you live in the UK (you must live in the UK) then you could open an account with Nutmeg. They can build a portfolio for you: https://www.nutmeg.com/nutmeg-it

    If you are an expat, then please read my Global Expatriate’s Guide To Investing. It explains what you can do.

    • Tanya Renner says:

      Yes, I’m in the UK – thank you so much Andrew, will take a look at Nutmeg – was going crazy trying to find a way of getting started with no savings. Having filled your book with lots of highlights and trying to implement what you’ve said – thank you again

  251. Mark says:

    Hi Andrew,
    Thank you for your quick reply. Yes I am a new investor and like many during the DOTCOM boom I had invested my wife’s and my ISA allocation into a TECH fund and we got burned badly like the other millions. Subsequently, I invested in paying down my mortgage and 4 yrs ago sold up and moved to BC, Canada and have been renting. I hold a handful of FTSE100 company shares but after reading your Millionaire Teacher and Expats Guide it has been an enlightenment and I have followed your guidance and already bought Indexes in my TFSA and now I am deliberating on how I should proceed with doing the same for my ISA funds in the UK. Thanks Mark.

  252. Jay says:

    Hi Andrew,
    Millionaire Teacher reshaped our thinking after we made the classic Skandia, Generali and Zurich expat mistakes in the past. Your work, along with Dan Bortolotti, has made investing easier and far more secure for our family moving forward. For that, we thank you.

    My question is this:

    We were overseas for 15 years, but moved home to Canada to be near family less than two years ago. We have an RRSP and Margin account with Questrade, but are curious, if we ever move overseas again is it legal to continue using the Margin account while outside Canada to continue funding our index ETF strategy? Obviously we can’t fund the RRSP account (we’d leave it sit where it is), but could we use the Margin account instead of opening up another brokerage account offshore? Likely to retire in Canada 20+ years from now if that’s a consideration.

    Many thanks.

  253. Alex says:

    Hi Andrew, I thought I posted a comment on here a few days ago but it seems to have disappeared. Sincere apologies if you’re receiving this twice. I’ve just devoured your Expat Investment book – great read and I’ll certainly be recommending it to friends!

    I’m a 30-year old Brit living in Shanghai. I’ve also got a Belgian and Canadian citizenship, and my fiancee is Swedish. We have no idea where we’ll retire, but it’s unlikely to be the UK or China. I’m a first-time investor planning to invest 6 years worth of savings, most likely using your Couch Potato approach. I’d highly appreciate any insight you have to the following questions before I get started:

    1. You mention that, overall, the choice between Couch Potato and Fundamental Indexing isn’t life-altering. What are the main factors to take into considering when deciding between the two?
    2. You mention that exposure to your home country is important, as that is where you’ll eventually be paying your bills. Is the reasoning behind because investments in the home country are in the same currency? If you aren’t planning to be in the home country until retirement, couldn’t you just convert it once you repatriate?
    3. As I don’t know where I’ll retire, does it still make sense to have exposure to at least one of the countries for which I hold a passport?
    4. You don’t mention digi-advisors such as Nutmeg in your book. How do you rate these (the fees I’d be looking at with Nutmeg are 0.75%) compared to the methods you advocate?

    Thanks in advance for your help, much appreciated!

    Alex

    • Hi Alex,

      I mentioned the differences between fundamental and cap-weight index investing in my book. I can’t think of how to answer your question. Other factors to consider? I don’t know.

      2. This question is easier to answer. Let’s say you decide to retire in Canada. Assume that your bonds are in UK pounds. Sure, you could convert your UK pounds to Canadian dollars when you retire. But what if the UK pound sank 20%, compared to the Canadian dollar, by the time you retire? Ouch. That’s a conversion that would hurt. If you aren’t sure where you are going to retire, you can avoid such currency risk by building a completely global portfolio, such as what I mentioned on page 239, table 17.4. Converting such a portfolio into any home currency wouldn’t be dramatic, either way, because the bonds in this example aren’t pegged to a single currency.

      3. Question 3 is a good one. Sure, considering that you might have a leaning to either Canada, the UK or Europe, you might want to blend your equity exposure a bit, with slight biases towards the countries you have citizenship with. For the stock portion of your portfolio, you could put 60% of it in a global index, 15% in a Canadian index and 25% in a European index. A European component would have high UK exposure as well as broad continental exposure. Just remember, the allocations that you choose aren’t that important. But as I repeat, over and over in the book, sticking to those allocations is really important. Don’t abandon those other country ETFs if you start out with them and they don’t perform as well over a 7 year period. Just when you decide to give up, they will likely flourish. There’s no secret sauce here. Whatever allocation you choose (or whether you go fundamental or cap-weighted) stick it out through thick and thin.

      4. I don’t yet know of a digital advisor that would service expats and ensure that you don’t have to pay resident taxes. With Nutmeg, you would be responsible for UK capital gains taxes. If you live in Shanghai, and you use one of the DIY brokerages mentioned in my book, you won’t have to pay capital gains taxes on the growth.

      I hope this helps.

      Would you mind posting a short review of my book on Amazon UK? https://www.amazon.co.uk/Global-Expatriates-Guide-Investing-Millionaire/dp/1119020980/ref=sr_1_1?ie=UTF8&qid=1478166679&sr=8-1&keywords=global+expatriates+guide+to+investing

      Cheers,
      Andrew

      • Alex says:

        Hi Andrew,

        No problem, I’ve just written a review on Amazon, more than happy to help spread the word!

        Thanks for your answers. The only decision left for me to make is regarding the choice of brokerage. You mentioned in your book that, in the grand scheme of things, it doesn’t matter much which discount brokerage you select, however, from reading a couple of the previous posts, it sounds like there have been some slight changes in cost structures?

        I’m based in Shanghai but my savings are currently in a UK account in GBP. I plan to invest GBP 40k in ETFs. For the stock segment (70% of total), I’ll probably go for 60% global index, 20% European, 10% Canadian and 10% emerging.

        I gather your personal preference is TD, but do you think there is any significant advantage between TD, Saxo and IB (providing I transfer it over to another brokerage before I die) for somebody in my situation?

        Thanks for your help, much appreciated!

        Alex

        • Hi Alex,

          Your investment behaviour will be the biggest determinant of your success. The brokerage you choose is like choosing where you are going to buy your groceries. It won’t make or break your retirement. Also these brokerages change their fees all the time. In the past ten years, I’ve seen it a lot. So just pick one. I chose TD Direct International because I may not be able to transfer the assets before I die. I could drown, have a heart attack, an aneurism, get killed on my bike, a car crash etc.

          Cheers,
          Andrew

  254. Brad says:

    Hi Andrew,

    After reading your books countless times and doing lots of research I am almost there!

    I personally met with Saxo’s Eoh Young here in Shanghai, who you reference in your book, to open my Saxo Singapore trading account.

    The final step prior to purchasing my ETF’s was a funds transfer from my UK bank account. When I submitted my amount, 15,000 USD, I was stung with a 2% fee for the fund transfer (I didn’t proceed). This fee existed for all amounts and for different card types such as visa, master card, debit and credit cards

    I understand your point about ongoing costs being the main cost to avoid and have written off the 0.5% currency conversion as a fee that I will have to stomach as it won’t have a significant, long lasting impact on my investments.

    However, if I have to pay a 2% charge every time I fund my Saxo account I am playing catch up from the start and I don’t think it’s a sustainable way for me to build my pension.

    This morning I was a little deflated as it has took lots of time to set up the Saxo account as a British Expat living in China trying to set up an account in Singapore. However, I’m going to keep going, I am very energized by your books though so am not about to give up now, I just want to get the ball rolling ASAP!

    Has anyone else faced similar charges? If so, have you circumnavigated them and how?

    I think I may need to set up a Singaporean bank account and divert wages earned