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sgbsgb 13-10-2019 07:33 PM

Quote:

Originally Posted by BBCWatcher (Post 123210863)
What are you trying to accomplish?

i am trying to bring down my equities % and move the money to bonds.

Okenba 13-10-2019 07:43 PM

Quote:

Originally Posted by BBCWatcher (Post 123210785)
What will be your initial monthly savings amount, Okenba?

For SRS, I hope to contribute the full 15300 per year.
For cash, I'm looking at about 500 per month.

I have not started investing yet. Am apprehensive because everyone seems to be expecting a crash. But I've promised myself I'll start Jan 2020 and DCA my way through...

Okenba 13-10-2019 08:11 PM

Quote:

Originally Posted by weng0202 (Post 123210839)
SRS can only buy local stocks if I didn't remember wrongly. So you have to use the SRS for something else.

This is unlikely I think.

Prior to the single global ETF plan, I was planning on letting Stashaway manage my entire SRS. I believe they invest in US and Global ETFs, so I assume it should not be an issue for SRS funds to be invested outside of SG...

Gughie 13-10-2019 09:14 PM

Hi guys. I am looking at buying gold and I understand besides the physical gold, you can buy the gold ETF offered on SGX i.e. O87.SI but ever since I've used IBKR, I never ever want to purchase anymore shares on DBS vickers due to the outrageous fees.

Qn: Is there a gold ETF that I can buy using IBKR? Since there would not be any dividends from a gold ETF, it does not need to be domiciled in Ireland right?

BBCWatcher 13-10-2019 09:46 PM

Quote:

Originally Posted by sgbsgb (Post 123210925)
i am trying to bring down my equities % and move the money to bonds.

All the bond funds mentioned so far, plus all other bonds and bond funds, would accomplish that. What else are you trying to accomplish?

Quote:

Originally Posted by Okenba (Post 123211061)
For SRS, I hope to contribute the full 15300 per year.
For cash, I'm looking at about 500 per month....

Prior to the single global ETF plan, I was planning on letting Stashaway manage my entire SRS. I believe they invest in US and Global ETFs, so I assume it should not be an issue for SRS funds to be invested outside of SG...

OK, the first thing I should mention is that (in my view) you ought to prioritize your CPF-related tax relief opportunities ahead of SRS contributions. Also, due to the more limited universe of investment choices and pathways for SRS funds, and due to the way the tax benefits work, they're really best suited to those who are in moderately high or higher tax brackets. One would think you'd have a higher monthly savings flow if you're in that sort of tax bracket.

All that said, Lion Global's Infinity Global Stock Index Fund, a unit trust, is probably the best you can do with SRS funds and your stated objective. Their fund is effectively a feeder into VWRA but with a total expense ratio of 0.81%. And that's assuming you buy it and hold it via a zero fee platform. Last I checked there are two of them for SRS dollars: POEMS and DollarDex. FSMOne apparently charges a custodial fee for SRS accounts.

It looks like Stashaway is only going to start to get clearly competitive on a cost basis when you get above S$250,000.

For the remaining S$500/month of savings flow you'd probably make quarterly VWRA buys via Standard Chartered.

Quote:

Originally Posted by Gughie (Post 123212617)
Is there a gold ETF that I can buy using IBKR? Since there would not be any dividends from a gold ETF, it does not need to be domiciled in Ireland right?

It depends on how you feel about the U.S. estate tax and, if so, what your total U.S. estate taxable assets will be.

sgbsgb 13-10-2019 10:07 PM

[QUOTE=BBCWatcher;123213158]All the bond funds mentioned so far, plus all other bonds and bond funds, would accomplish that. What else are you trying to accomplish?

Noted with thanks sir. I got a better understanding now.

Okenba 13-10-2019 10:32 PM

Quote:

Originally Posted by BBCWatcher (Post 123213158)
OK, the first thing I should mention is that (in my view) you ought to prioritize your CPF-related tax relief opportunities ahead of SRS contributions. Also, due to the more limited universe of investment choices and pathways for SRS funds, and due to the way the tax benefits work, they're really best suited to those who are in moderately high or higher tax brackets. One would think you'd have a higher monthly savings flow if you're in that sort of tax bracket.

Thanks for your response. I have prioritised the total 14k CPF tax relief. I assume that's the one you're referring to. I don't know of any others. I hope you don't mind if I pick your brain a little more on SRS suggestions...

Quote:

Originally Posted by BBCWatcher (Post 123213158)
All that said, Lion Global's Infinity Global Stock Index Fund, a unit trust, is probably the best you can do with SRS funds and your stated objective. Their fund is effectively a feeder into VWRA but with a total expense ratio of 0.81%. And that's assuming you buy it and hold it via a zero fee platform. Last I checked there are two of them for SRS dollars: POEMS and DollarDex. FSMOne apparently charges a custodial fee for SRS accounts.

Can you help me understand why I would choose Lion global with a expense ratio of 0.81, over VWRA with an expense ratio of 0.25. I would guess trading fees for overseas exchange and perhaps some custodian fees, but do those really make up more than the 0.81-0.25= 0.56?
Perhaps it is due to the limited selection of platforms that deal with SRS?

Quote:

Originally Posted by BBCWatcher (Post 123213158)
It looks like Stashaway is only going to start to get clearly competitive on a cost basis when you get above S$250,000.

For the remaining S$500/month of savings flow you'd probably make quarterly VWRA buys via Standard Chartered.

I actually really like the usability of Stashaway's app. Its simple and clean and a huge draw to someone like me with no investing experience. But I don't think the fees are competitive.

Why do you recommend Stanchart over IB please? Would like to better understand.

Also, since SRS selections are so limited, would you recommend forgoing the tax relief in favour of the greater selection of non-SRS investments?

BBCWatcher 13-10-2019 10:51 PM

Quote:

Originally Posted by Okenba (Post 123213780)
Thanks for your response. I have prioritised the total 14k CPF tax relief. I assume that's the one you're referring to. I don't know of any others.

You can top up your own MediSave Account with tax relief as long as that top up fits within the CPF Annual Limit and the Basic Healthcare Sum.

Quote:

Can you help me understand why I would choose Lion global with a expense ratio of 0.81, over VWRA with an expense ratio of 0.25. I would guess trading fees for overseas exchange and perhaps some custodian fees, but do those really make up more than the 0.81-0.25= 0.56?
Perhaps it is due to the limited selection of platforms that deal with SRS?
Simple: you cannot buy VWRA directly using SRS dollars.

Quote:

Why do you recommend Stanchart over IB please? Would like to better understand.
S$500/month isn't a big enough flow to overcome the US$10/month monthly minimum commission that Interactive Brokers charges. S$1,500/quarter via Standard Chartered would make some more sense in terms of costs.

Quote:

Also, since SRS selections are so limited, would you recommend forgoing the tax relief in favour of the greater selection of non-SRS investments?
Maybe, probably. That'll depend in large part on your current marginal tax bracket (after other tax reliefs) and how far away you are from qualified SRS withdrawals (which can start no earlier than age 62).

KeytoFreedom 16-10-2019 09:45 PM

Has anyone studied the Lion Global Infinity Global stock index Fund, whether it performs similar to the VWRA?

Sent from OnePlus ONEPLUS A5010 using GAGT

Greennoob 18-10-2019 04:44 PM

Getting US tax friendly
 
I am likely to be applying for a Green Card in 3-4 years time once my employment contract is confirmed
I am 50 currently based in SG and paying only SG tax
and have been investing mainly in Sg stocks some IBKR LSE stocks and have CPF . Plus various life insurance policies from SG companies.
How can i slowly convert and what to convert to i.e becoming more US tax friendly so as to avoid the hassle of reporting /declaration etc before i step foot to the US .
Hope BBCwatcher can give some guidance
Thanks

BBCWatcher 18-10-2019 09:18 PM

Quote:

Originally Posted by Greennoob (Post 123286325)
I am likely to be applying for a Green Card in 3-4 years time once my employment contract is confirmed

What visa type will you be using if you don't mind me asking? Marriage-related (IR-1, CR-1, or K-1), H-1B1, L-1, or something else?

Quote:

I am 50 currently based in SG and paying only SG tax
and have been investing mainly in Sg stocks some IBKR LSE stocks and have CPF . Plus various life insurance policies from SG companies.
How can i slowly convert and what to convert to i.e becoming more US tax friendly so as to avoid the hassle of reporting /declaration etc before i step foot to the US .
Hope BBCwatcher can give some guidance
Thanks
Sure. Here are the basic groundrules as I see them, in no particular order. These suggested changes would be performed strictly before stepping foot in the United States (even for a "look see" visit, if applicable), but even a day beforehand is sufficient.

1. Unwind your positions in what the IRS classifies as "PFICs" (Passive Foreign Investment Companies). That'd include non-U.S. ("foreign") domiciled funds (for example IWDA, ES3, G3B, MBH, A35), foreign unit trusts, foreign REITs, and individual foreign stocks that aren't very clearly pure play businesses. As one example, if the stock has "Holdings" in its name -- Jardine Holdings -- then chances are excellent the IRS would consider it a PFIC. Singaporean companies being what they are, with all sorts of complex cross-ownership and such, most of their stocks probably are PFICs. The individual bank stocks (DBS, UOB, OCBC) should be OK, though.

It doesn't matter whether the PFICs are held within "wrappers" or not, such as a SRS account or the CPF Investment Scheme. They're still PFICs, and PFICs simply aren't good from a U.S. tax point of view.

2. If you have appreciated assets, then you may wish to liquidate them before landing in the U.S. That's to reset the cost basis so that you can reduce or eliminate future capital gains tax.

That includes real property, although usually you can qualify for a US$250,000 (US$500,000 for a couple) capital gains exemption based on the net gain, after allowable costs are subtracted, on a primary residence as long as you don't wait too long to sell it after your relocation. (There's a self occupancy requirement to qualify as a primary residence.) For example, you might decide to move to the U.S., see how it goes for a couple months or whatever, then sell your home back in Singapore. That's OK on an appreciated home as long as you qualify for the capital gains exclusion and it's big enough.

3. Remaining foreign assets that generate dividends -- shares of DBS stock as an example -- are OK, but bear in mind the dividends are taxed at your ordinary income tax rate, not at the preferential rate that applies to U.S. dividends. If that bothers you, then you could unwind those positions if you wish.

4. If you want to maintain a Straits Times Index stock fund holding you can using EWS on the New York Stock Exchange. EWS is equivalent to ES3 and G3B. The fund manager charges a little more on EWS, although it's not too bad.

5. While A35 and MBH are PFICs (and thus not good at all), there's no problem holding individual ordinary/simple bonds, such as Singapore Savings Bonds and other Singapore Government Securities, and that Temasek retail bond that was offered in 2018 (but not the "Astrea" notes, which aren't Temasek guaranteed anyway -- those are definitely PFICs). Singapore dollar fixed deposits are fine, too. The insurance products you mention are probably fine, as long as they're not too exotic. You have to report all foreign financial accounts (including CPF, it would appear), and the interest is U.S. taxable, but they're fine. An ordinary bank account in Singapore is also fine. You'll be able to sign up for an IBKR Lite account as a U.S. resident, and that'll be a fantastic path to transfer and convert Singapore dollars at your bank in Singapore to U.S. dollars at your favorite U.S. bank or U.S. credit union in the U.S.

6. You'll very likely want to pile into the U.S. tax advantaged retirement savings accounts as soon as you're eligible, but that's a whole separate topic.

Also, try to clock meaningful contributions into the U.S. Social Security and U.S. Medicare systems within at least 10 calendar years, because that'll qualify you for Social Security and Medicare benefits. That is to say try to maintain at least part-time employment until about age 60. There's a big difference between hitting that magic number and just missing.

....Those are some highlights. Any follow-up questions?

Greennoob 19-10-2019 11:10 AM

Thanks very much

Lots to digest will come back with more clarifications soon

Much appreciated

BBCWatcher 19-10-2019 02:45 PM

The U.S. runs an annual lottery for “diversity visa immigrants,” meaning entry into the United States for permanent residence for several thousand lucky applicants who were born in countries that aren’t already major sources of U.S. immigration. It’s October, and that lottery is now open!

To grab a lottery ticket (if you’re interested), apply here. Couples can each individually apply if they qualify and effectively get two lottery tickets for the family. (You apply and list your spouse, and vice versa.) There’s no charge to enter the lottery, although of course there are fees if you’d like to proceed if you’re lucky enough to win the lottery.

Good luck!

bossjiaksai 21-10-2019 05:56 PM

Hi BBCW, would like to seek your advice on how to optimise my cpf further, age 26.

OA: 21k (haven't buy house)
SA: 145k (due to RSTU top ups over the past few years)
MA: 46k (due to cash top ups up to annual limit)

Salary around 4.5k / month

I intend to max out my MA next year, top up 7k RSTU to SA. or should i max out SA fully first before looking at MA?

Also, I would like to start a passive portfolio that can net me around 5% per annum. Currently I have about 260k in local equities, around 120k in cash. My equities are all over the place, anyhow buy and hold over the years. Would like to replan for future. Is there an ideal allocation/split on what to buy?

BBCWatcher 21-10-2019 09:23 PM

Quote:

Originally Posted by bossjiaksai (Post 123332073)
OA: 21k (haven't buy house)
SA: 145k (due to RSTU top ups over the past few years)

You're allowed to transfer any number of OA dollars into your SA if you wish, up to the Full Retirement Sum (and if you're under age 55).

Quote:

I intend to max out my MA next year, top up 7k RSTU to SA. or should i max out SA fully first before looking at MA?
I prefer leaning into MA first for a variety of reasons.

Quote:

Also, I would like to start a passive portfolio that can net me around 5% per annum. Currently I have about 260k in local equities, around 120k in cash. My equities are all over the place, anyhow buy and hold over the years. Would like to replan for future. Is there an ideal allocation/split on what to buy?
It should almost go without saying that investing exclusively in Singapore-listed stocks is rather perilous. I'd get some geographic stock diversification going there.


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