Millionaire Expat

When ANDREW HALLAM isn’t getting eaten by mosquitoes in a tropical jungle, cycling up the side of a volcano with his wife during a downpour or trying to drive to Argentina in a van, he’s speaking and writing about happiness, personal finance and low-cost retirement destinations. Profiled by such media as CNBC and The Wall Street Journal, the former high school teacher is the first person to have a #1 selling finance book on Amazon USA, Amazon Canada, Amazon UAE and Amazon Singapore. He has written columns for The Globe and Mail, Canadian Business, AssetBuilder.com, MoneySense, and Swissquote. His other books include Millionaire Teacher and Balance: How to Invest and Spend for Happiness, Health and Wealth. Find him online at andrewhallam.com.

• Acknowledgements xiiiIntroduction 1Chapter 1: Grow Big Profits Without Any Effort 7Why Average Returns Aren’t Normal 11When the Stock Market Beats Real Estate 12What’s Inside a Global Stock Market Index Fund? 13Undressing Stocks with 50 Shades of Gray 13The Stock Market Stars as the Great Humiliator 17Fast-Growing Economies Can Produce Weak Returns 19Bonds Are Protective Nets for Jumpers 21Can You Lose Money with Bonds? 23Chapter Take-Away 25Chapter 2: Don’t Start a Fight with an Escalator 27Yes, the Financial District Loves You! 28Global Investors Getting Fleeced 30Chapter Take-Away 32Chapter 3: Where Are the Customers’ Yachts? 33Global Investors Bleed by the Same Sword 34American Expatriates Run Naked 36Why Brokers Want to Muzzle Warren Buffett 37Financial Advisors Touting “The World Is Flat!” 38Hedge Fund Money Spanked for Its Con 40Why Most Investors Underperform Their Funds 42Are Most Financial Advisors Bad People? 43Chapter Take-Away and Tips 45Chapter 4: Expats Should Avoid Snakes In Suits 49The deVere Group Faces Trouble 57British Expats: Can I Trade You That Diamond for a Big Lump of Coal? 58The 10 Habits of Successful Financial Advisors . . . Really? 59When Your Advisor is a Sales Commando 60Welcoming Sharks into the Seal Pool 61Masters of the Insured Death Benefit Illusion 65Free Fund Switching Isn’t a Perk 66Making Millions off the General Public 66Fooling the Masses with Numbers 67When High Fees Meet Gunslingers 68Chapter Take-Away and Tips 69Chapter 5: Self-Appointed Gurus and Neanderthal Brains 73Why Most Investors Should Hope for Falling Markets 77Are You Cheering for the Right Team? 77If You’re Just Starting Out, Pray for Stocks to Sputter 79Should You Worry When Stocks Hit All-Time Highs? 82The Only Thing That Matters 82It’s Not Timing the Market That Matters; It’s Time in the Market 84High Unemployment and High Stock Returns 85What Can You Miss by Guessing Wrong? 87Should You Invest a Windfall All at Once? 89When Investors and Advisors Sabotage Their Rides 89Are Women Better Investors Than Men? 90Collar Your Inner Neanderthal 91Chapter Take-Away and Tips 92Chapter 6: Investment Advisors with a Conscience 95Do You Have a Ninja’s Discipline? 96Qualities of a Good Financial Advisor 96Investment Professionals Worth Considering 98Why Many Global Expats are Naming Their Newborns Mark 111Why are the Entry Points Often High? 113Chapter 7: Thirty-four Questions Do-It-Yourself Investors Ask 1151. How do I Purchase ETFs or Indexed Mutual Funds Through a Brokerage? 1152. What’s the Best Brokerage To Use? 1163. What’s the Difference Between an Exchange-Traded Index Fund (ETF) and an Index Fund? 1174. Do Non-Americans Have to Pay US Estate Taxes upon Death if They Own US Index Shares? 1185. What’s a Sector-Specific ETF? 1196. Should I Buy an Index that’s Currency Hedged? 1207. What’s the Scoop on Withholding Taxes? (For Non-Americans) 1218. Will You Have to Pay Currency Conversions? 1239. Should I Be Concerned about Currency Risks? 12410. Do the Unit Prices of ETFs Show Which are Expensive or Cheap? 12511. If I Have a Lump Sum, Should I Invest It All at Once? 12612. I’m in Some Expensive Products, but They’re Currently Down in Value. Should I Sell Now or Wait? 12613. What If I Find a Higher-Performing Bond Index? 12714. What If I Find a Cheaper ETF? 12815. Should I Be Most Concerned about Commissions, Annual Account Fees, Fund Costs, or Exchange Rate Fees? 12816. How Little Can I Invest Each Month? 12917. Stock Markets Are High. Should I Really Start Investing? 13018. Should I Buy ETFs from Vanguard, iShares, Schwab or Another Low-Cost Provider? 13119. Can Muslims Build a Portfolio of Shariah-Compliant Funds? 13220. What Percentage Should You Have In Stocks and Bonds? 13321. Could You Build a Portfolio of Socially Responsible Index Funds? 13922. Why Doesn’t My Brokerage Offer the Funds I Want? 14023. Why Hasn’t My Bond ETF Risen in Value? 14124. What If My Bond ETF Is Priced in a Different Currency? 14225. Are Cryptocurrencies, like Bitcoin, Good Investments? 14226. Should I Buy a Real Estate Investment Trust (REIT) Index? 14427. Should I Buy a Smart Beta ETF? 14628. Should I Invest in Gold? 14729. Don’t Small-Company Stocks Beat Larger-Company Stocks? 14830. What If You and Your Spouse Represent Different Nationalities? 15031. Why Should I Rebalance My Portfolio? 15132. What Are The Best ETFs To Buy? 15233. What’s the Difference Between an Accumulating ETF and a Distributing ETF? 15334. Should I Buy An ETF or Index That Pays High Dividends? 153Chapter 8: Couch Potato Investing 157Don’t Bonds Tie You Down? 158Are You Worried That Bond Interest Rates Are Low? 159Where Do You Plan to Retire? 160Are You Retiring in an Emerging-Market Country? 162The Magic Of All-in-One Portfolio ETFs and Index Funds 162Chapter 9: Model Portfolios for American Expats 167Do You Currently Invest with Vanguard? 168Couch Potato Investing with Vanguard 169Simple Investing with a Vanguard Stick Shift 172Vanguard’s Admiral Series Global Two-Fund Portfolio Solutions Socially Responsible Investing 174Americans Using Interactive Brokers 176ETF Portfolios with Interactive Brokers 176Socially Responsible ETF Portfolios 176Don’t Contribute Illegally to Your IRA 176What Exactly Is an IRA? 179Could You Retire And Never Pay US Taxes Again? 180Chapter 10: Portfolio Models for Canadian Expats 183Socially Responsible Investing for Canadians 185Swap-Based ETFs—The Ultimate Legal Tax Dodge 186What About RRSPs, TFSAs and RESPs? 188Children’s Education Savings Plans 189Canadians In Europe 191European Country Residents not Affected By This Rule 191For Most Canadians Living In an EU Country 192One Drawback To Non-Canadian Listed ETFs 193Repatriation: If You Decide To Move Back 194Chapter 11: Portfolio Models for British Expats 197Are The Extra Commission Fees Worth It? 200The Downside of Vanguard’s LifeStrategy Index Mutual Funds 203Portfolios of Individual ETFs: For Walking British Buddhas 204How Important Is UK Stock And Bond Market Exposure? 206Socially Responsible Investing For British Expats 208Are You Really Ready To Do This? 210Chapter 12: Portfolio Models for Australian Expats 213Socially Responsible Investing For Australians 214What If You Don’t Want High Exposure to Australian Shares? 217The Repatriation Benefit of Aussie-listed Shares 218Tax Laws: Created By The Rich For The Rich? 219Now Look Deeply Into That Mirror 220Chapter 13: Portfolio Models for Europeans and Other Nationalities 223The Home Currency Bias 224Investors Who Might Not Want Any Home Currency Exposure 226Socially Responsible Investing 229Chapter 14: Setting Your Bulls Eye 231What’s a Better Definition of Wealth? 233What’s This Ailment Expatitis? 233Three Decades And Counting With The 4 Percent Rule 234You and Your Money Can Both Last Longer 237Part II Retirement or Semi-Retirement In A Low-Cost Country 239This Personal Decision In Not For Everyone 240When It’s Not About The Money 241Chapter 15: Retire A Decade Early In Latin America 245Mexico: Hot Beaches, Cool Mountains And The World’s Best Expat Social Scenes 246Costa Rica: Happiest People, Best Wildlife And Environmental Leaders 252Panama: Idyllic Islands, Popular Mountain Towns and Retirement Discounts Galore 256Ecuador: Friendly People, Great Climate, And An Ultra-Low Cost Of Living 261Chapter 16: Retire A Decade Early In Europe 267Portugal: Crashing Surf, Gorgeous Scenery and Europe’s Best Weather 268Home Sweet Home 270From Canada to Portugal for an Easier Pace of Life 271Spain: Spectacular Beach Walks and Skiing In The Same Day 274Aerobatics Pilot Chooses To Fly 275Couple Enjoys Life on Less Than €9000 a Year 275If You Don’t Have A Pension, How Much Money Would You Need? 277Eastern Europe: The World’s Best Low-Cost Secret 278Climate and Safety 279Why Georgia’s Becoming The New Hot Spot 280Chapter 17: Retire A Decade Early In Southeast Asia 285Retiring In Malaysia: Beauty In The Sun 286Can You Handle The Heat? 286Top Quality Medical 287Retiring In Thailand: The Land of Smiles 289Conclusion 295Low-Cost Retirement Country Resources 297Index 303