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Old 15-09-2018, 07:42 PM   #657
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Join Date: Mar 2012
Posts: 4,142
OK, duly noted.

That’s very interesting. I may have some ideas for you. May I confirm that you were issued (and thus have for life) a U.S. Social Security Number?

Before we get too deep into this, are you telling me/us that you spent some time working in the United States, invested in mutual funds, and somehow managed NOT to buy any of those funds within a U.S. 401(k) or IRA (tax advantaged account)? Is that correct? How did THAT happen?

As a separate matter, I have some possible good news for you. It’s possible that you will qualify for U.S. Social Security retirement benefits either based on your own contributions into the U.S. Social Security system (plus any treaty country contributions) or even based on your ex-spouse’s U.S. Social Security contributions. The latter is a slightly difficult needle to thread, but it can be done. How many years did you work in the United States? Have you remarried?

A couple ideas I’m likely to explore, pending some more information from you, is whether it’s possible to set up what’s called a “529” education savings account for your U.S. citizen child and/or a UGMA (Uniform Gifts to Minors Act) investment account. If you do the latter then the advantage is that your 30% dividend tax rate on these funds probably drops to zero. (U.S. citizens enjoy a lower tax rate, and since presumably this would be your child’s only income, zero would be the most likely answer.) There are some disadvantages, though. First, you’d need a few years to transfer the assets since there’s an annual gift limit. Second, you’d have to file U.S. tax returns for your child, so the paperwork gets more complicated. Third, UGMA assets count as your child’s own assets for purposes of U.S. higher education financial aid calculations, and thus they could reduce future need-based scholarships and student loans if your child attends a U.S. university.

Setting up a “529” might be difficult for a non-U.S. person who is not U.S. resident, but if you have a SSN then that’s one major hurdle cleared. I think it might be possible to pull off. But the advantage is again zero tax provided the funds are used for qualified educational expenses.

May I also assume that you maintain a U.S. mailing address on your Fidelity and Vanguard accounts? Ordinarily Fidelity and Vanguard get a little upset, eventually anyway, if otherwise.

The key question here is whether your employer provides any matching funds, or if there’s otherwise any sort of financial attraction to your participation in this arrangement. So what’s the basic deal you’re getting here?
Yes, it is just like CPF. Employer matches, employees' contribution.

Many foreign banks do this in Singapore. Atleast I know Credit Suisse and Barclays offer this for EP holder employees. Credit Suisse offers it through HSBC Hong Kong ORSO scheme. Barclays through PWC.

Sent from Dont Take Any Of My Statment As Investment Advice. Do Your Own Due Diligence. using GAGT

Last edited by revhappy; 15-09-2018 at 07:44 PM..
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