What about investment accounts? This is/has been a huge hurdle due to:
US PFIC taxes on the one hand (applying to US citizens who want to own non-US based investments); and
US investment firms (e.g. Vanguard, Fidelity, etc.) not wanting to deal with residents of the EU (including US citizens) due to EU investment disclosure requirements that the US mutual funds and ETFs don't comply with.
Quite a difficult issue, especially for retirees who need to stay invested in order for their funds to last the decades needed!
Yep, investment accounts are a whole separate beast.
The short version: most US Citizens abroad keep their US brokerage and only buy US-registered funds (before exiting). That sidesteps PFIC entirely.
The hard part is finding brokerages that don't freeze your account when you update your address. A select few work well abroad, most don't.
There are also ways to invest outside of funds altogether (individual stocks, real estate abroad, even physical gold). Each has reporting req but nothing like the PFIC.
I'll cover this in one of the modules of my upcoming Retire Abroad Blueprint program in more detail.
I was pleased to have retained a credit union account after WF closed our financial accounts for to the foreign address. Our CU provides international services and also hosts traditional IRAs. Any comment on credit unions as opposed to traditional commercial banks?
That's great John. You got lucky with your CU. Most are actually more restrictive than big banks when it comes to foreign addresses and international transactions. They tend to be risk-averse and will close accounts without warning if they see too much overseas activity. But if yours is expat-friendly and hosts IRAs, definitely hold onto it.
This great advice. You’ve provided simple straightforward methodology. As a Canadian I still follow the same rules.
We lived in Switzerland, France, and New Zealand for a number of years. As diplomats we were able to easily get a local bank accounts, but not without its own challenges and restrictions.
Thanks Roberta! It's eye opening for me, what (in my eyes) simple systems that I have been using for years, are so valuable to others. I have to put myself in first-timers shoes more ;)
We use a Charles Schwab Investor account and a local bank. There is a Visa Platinum Debit Card attached to the Schwab Investor checking account, and there are no transaction fees for international ATM withdrawals.
That depends on a few factors, what company type, what business and also nationality and what kind of payments will be received (subscription, coaching, physical goods etc.).
For US citizens, FATCA is THE issue when it comes to money matters. Eg, most local banks consider you are a "persona non grata" and you are rejected in a first screening.
What about investment accounts? This is/has been a huge hurdle due to:
US PFIC taxes on the one hand (applying to US citizens who want to own non-US based investments); and
US investment firms (e.g. Vanguard, Fidelity, etc.) not wanting to deal with residents of the EU (including US citizens) due to EU investment disclosure requirements that the US mutual funds and ETFs don't comply with.
Quite a difficult issue, especially for retirees who need to stay invested in order for their funds to last the decades needed!
Yep, investment accounts are a whole separate beast.
The short version: most US Citizens abroad keep their US brokerage and only buy US-registered funds (before exiting). That sidesteps PFIC entirely.
The hard part is finding brokerages that don't freeze your account when you update your address. A select few work well abroad, most don't.
There are also ways to invest outside of funds altogether (individual stocks, real estate abroad, even physical gold). Each has reporting req but nothing like the PFIC.
I'll cover this in one of the modules of my upcoming Retire Abroad Blueprint program in more detail.
I was pleased to have retained a credit union account after WF closed our financial accounts for to the foreign address. Our CU provides international services and also hosts traditional IRAs. Any comment on credit unions as opposed to traditional commercial banks?
That's great John. You got lucky with your CU. Most are actually more restrictive than big banks when it comes to foreign addresses and international transactions. They tend to be risk-averse and will close accounts without warning if they see too much overseas activity. But if yours is expat-friendly and hosts IRAs, definitely hold onto it.
Ben,
This great advice. You’ve provided simple straightforward methodology. As a Canadian I still follow the same rules.
We lived in Switzerland, France, and New Zealand for a number of years. As diplomats we were able to easily get a local bank accounts, but not without its own challenges and restrictions.
Great post.
Thanks Roberta! It's eye opening for me, what (in my eyes) simple systems that I have been using for years, are so valuable to others. I have to put myself in first-timers shoes more ;)
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Added you ;)
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You're on the list! ;)
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Thanks Frank, added you just now!
We use a Charles Schwab Investor account and a local bank. There is a Visa Platinum Debit Card attached to the Schwab Investor checking account, and there are no transaction fees for international ATM withdrawals.
That’s a great option!
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Hey Teresa, happy to add you! You would need to subscribe, so I can see your e-mail address, alternatively, you can DM it to me :) Ben
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Added you! :)
What do recommend for company accounts as an expat with an online business?
That depends on a few factors, what company type, what business and also nationality and what kind of payments will be received (subscription, coaching, physical goods etc.).
I'll DM you details…
Sure!
Hi Benjamin. Not sure where "Reply" is - technical luddite here. Wanted to send "RETIRE" to you. Thanks!
Hi Dawn! I got you ;) Will add you to the mailing list of the retire group now!
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Added you!
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Hey Jack, happy to add you. Once you subscribe, I'm able to add you to the list (or you can send me your e-mail via DM). Best, Ben
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Added you Renee!
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Thanks Nick, added you!
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Added you ;)
For US citizens, FATCA is THE issue when it comes to money matters. Eg, most local banks consider you are a "persona non grata" and you are rejected in a first screening.
Yep, FACTA is the issue here, absolutely right.
RETIRE
Added you! :)