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Tom Zachystal

Financial > Tom Zachystal

Tom Zachystal

Merrill Lynch Closing Brokerage Accounts For US Expats


Tom Zachystal

Merrill Lynch has recently been sending letters to many of their US citizen clients living outside the USA saying that their accounts will be closed as of October 1, 2016. The letter typically states the following:

We have conducted an extensive review of our non-US resident client business to determine whether we had the ability to continue to effectively serve your wealth and investment needs under increasing business requirements and regulatory restrictions. Having completed this analysis, we believe you would be better served by a firm or firms that can meet your comprehensive wealth and investment management needs. Therefore we will no longer be servicing your Merrill Lynch Wealth Management account(s) and/or credit facilities effective October 1, 2016.    more ...


Financial > Tom Zachystal

Tom Zachystal

Charles Schwab Announces Account Closures For US Citizens In Five Countries, More Expected


Tom Zachystal

Over the last few years I have written a number of articles on why US brokerage firms are closing accounts for American citizens living outside the USA and how we help those affected address the situation. It seems the severity of this issue is increasing.

Recently Charles Schwab, which up until now was pretty good at accommodating US expats, has sent letters to US citizens living in New Zealand, Dominican Republic, United Arab Emirates, South Africa, and South Korea saying that by the end of August their accounts will be frozen in the sense that they will only be able to liquidate investments but not re-invest the proceeds.    more ...


Financial > Tom Zachystal

Tom Zachystal

International Investor? Important Issues To Consider


Tom Zachystal

Our firm specializes in investment management for US expatriates, many of whom are concerned with diversifying their investment portfolio internationally and managing currency risk. Our accounts are multi-currency and we have access to investment markets around the world. I’ve noticed that there are some common misunderstandings regarding international investing, as well as a lack of information regarding costs and other issues with respect to such investments. Probably the most common misunderstanding is related to the location of the investment account and the currency in which it is denominated. The question usually goes something like this:    more ...


Financial > Tom Zachystal

Tom Zachystal

Why Your Brokerage Firm Is Freezing Your Mutual Funds (And What To Do About It)


Tom Zachystal

Over the last six years or so the US Internal Revenue Service’s initiative to catch tax evaders, known as “FATCA”, has inconvenienced thousands of law-abiding Americans living outside the United States by making it more difficult to open and hold both US and non-US bank and brokerage accounts.

FATCA, or the Foreign Account Tax Compliance Act, has gradually been implemented by US and non-US financial institutions and has resulted in the closure of many US brokerage accounts held by non-US residents. This is because in most instances FATCA has been implemented as an Inter-Governmental Agreement (IGA) that involves information sharing between the United States and another country with respect to financial accounts in one of the countries held by residents of the other country.    more ...


Financial > Tom Zachystal

Tom Zachystal

Why Is My US Brokerage Firm Closing My Account?


Tom Zachystal

Many US citizens living abroad have recently been contacted by their US brokerage firms to inform them that their accounts have either been frozen such that they can no longer change their investments or that they need to close their accounts entirely.

Even large brokerage firms and banks such as Fidelity and Wells-Fargo in many instances no longer want to deal with non-US resident clients through their US offices. Often there is little in the way of explanation, just a letter in the mail or a phone call from a broker who is following instructions and doesn’t really understand the issue.    more ...


Financial > Tom Zachystal

Tom Zachystal

Investment Account Considerations for US Expats


Tom Zachystal

Dealing with financial matters has become increasingly difficult for US citizens living outside the USA over the last few years as a result of what is called FATCA (Foreign Account Tax Compliance Act), which has led to both US and non-US financial institutions being reluctant to deal with American expats. In our financial planning practice we receive many enquiries from US expats regarding how best to deal with banking and investment accounts, especially US retirement accounts, and whether offshore or non-US investment accounts are a good idea for US expats.    more ...


Financial > Tom Zachystal

Tom Zachystal

Pitfalls of Exotic Expat Investment Strategies


Tom Zachystal

For the better part of this year investment markets have been largely trendless. There have been many ups and downs but no clear breakout to either the down-side or the up-side. The current state of things, a slowing and fragile economy in Europe as well as issues with sovereign debt, better economic data in the US, and perhaps a more stable outlook in Asia with lower inflation and still good growth, support the view that we may be in for an extended period of up and down investment market performance. In such a market, and especially given the difficult investment market we recently suffered in 2008-2009, there is a tendency for investors to give up on mainstream investments such as stocks and bonds and to seek better investment returns in more exotic vehicles, or by employing more exotic investment strategies. These products and strategies are often poorly understood by the average investor and heavily sold by certain investment sales people because commissions to the advisor are usually quite high.    more ...


Financial > Tom Zachystal

Tom Zachystal

Fiscal Cliff and FATCA – What Do They Mean For US Expat Investors?


Tom Zachystal

I have just returned from the town of Ajijic, a half hour out of Guadalajara, Mexico and home to about 10,000, mostly retired, Americans (as well as a large number of Canadians and even the odd Brit). During my week there, my colleague Marian Wellman and I put on a seminar on the topics of the coming US fiscal cliff, FATCA regulations, and the current investment climate. Much to my surprise, given the dry nature of anything concerning taxes, the seminar was heavily attended and standing room only; with most of the interest directed towards the first two topics – so I thought Expat Focus readers might also be interested in our overview.    more ...


Financial > Tom Zachystal

Tom Zachystal

Managing US Pension Accounts Outside the US


Tom Zachystal

If you have worked in the United States for any length of time (either as a US citizen or a foreign national) it is likely that you have paid into a US pension account such as an IRA (Individual Retirement Account) or a 401k (an occupational pension plan). The question then arises as to what should be done with such an account once you give up US residency.

There are three alternatives: You can transfer it to another pension account, you can distribute the money, or you can leave it in the current account.    more ...


Financial > Tom Zachystal

Tom Zachystal

Expat Income Alternatives for a Low Interest Rate World


Tom Zachystal

In the current low-interest-rate environment prevalent in many developed market economies it makes little sense to park one’s investment money in conservative fixed income investments that offer poor yields; perhaps even yields lower than expected inflation rates. Given the fact that the first few years of Baby-Boomers are now retiring, and people in retirement tend to favor income-producing investments, it seems there should be considerable demand for alternatives to bonds.

These alternatives should pay a good income stream, should be relatively conservative, should be able to withstand an inflationary environment, and should offer diversification benefits to stocks.    more ...