Choosing the smartest investment options for expatriates



Investment opportunities are everywhere and while anyone willing to take the risks can enjoy its rewards, only those who know how and where to start investing can fully reach their ultimate financial goals. But how about when talking about those living abroad? Do the same rules apply?

Perhaps, most expatriates have already discovered how financially rewarding it can be to live and work abroad. However, others who are yet to venture into wise investment options are faced by the challenges of logistical and strategic factors as well as complicated tax management woes that investing in a foreign land requires.

What are the factors that should be considered in order to achieve wise investment choices for expatriates? Here are several things that you should keep in mind.

• Remember that choosing tax-efficient investments also means opting for risk-adjusted returns.

• One should always go for a diversified investment portfolio to distribute risks. The adage, “do not put all your eggs in one basket,” will forever hold water.

• Focusing on foreign index funds is always practical because of its independence from the US dollar.

• Tax-efficient investments depend on the type of account that expats choose. For instance, Real Estate Investment Trusts (REITs) can legally bypass unfavorable taxes by looking at IRA and other tax advantaged account. Working with offshore financial services companies is another smart option.

• Properly managing your investment by doing careful research and thorough planning can make a huge difference. Seeking help from a professional won’t hurt, too.

• Buy low and sell high without worrying about the natural dips that can usually occur from time to time. Best, set a long investment horizon to ‘beat’ the markets’ volatility.

• For brokerage accounts, it’s best to go for low growth stocks. The said accounts are taxable but these types of stocks won’t be taxed until their specific gains are realized.

For more insights into investing in various financial instruments as a global expatriate, consult with an advisor at LOM Financial now.  

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