Where to Hold your Investment Assets
While Living Abroad
We advise American expats to hold their investment assets at a large, reputable US brokerage firm. There are several reasons why we recommend this, including:
- Robust offering of products and investment choices
- Stable regulatory oversight
- SIPC account insurance
- Proper reporting of investment gains, losses and dividends for IRS tax purposes
If you plan to move abroad, the best time to open a US based investment account is before you leave the US. This is because it may be easier to change the address on an existing brokerage account to a foreign address than it is to open a new account with a foreign address (of course this depends on the country to which you are moving).
If you already live abroad, you may still be able to open a US brokerage account, depending on the country in which you reside. The US Department of the Treasury's Office of Foreign Asset Control (OFAC) restricts US financial institutions from doing business with clients living in OFAC restricted countries. Additionally, many US brokerage firms maintain their own proprietary list of countries with which they do not conduct business. If your home country is not on the OFAC list, chances are you will be able to find a firm where you are able to open an account if you do some shopping around.
We recommend choosing a discount brokerage firm with a large selection of investment choices. Such firms often offer their services for a reasonable price, and usually have convenient tools, such as robust web sites, which will make it easier to administer your account from abroad.
Source: Maxim Global Wealth Advisors, By Jeannie Pedersen – 2009