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Old 17-02-2020, 04:09 PM   #1786
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By the way I forgot to ask about IBKR Lite (I don't remember there was such thing when I opened my account two years ago). Please correct me if I'm wrong but for those who only invest in LSE-listed ETFs the only benefit of Lite over Pro is the lack of monthly min $10 fee? I guess if you're based in the US and exclusively buy US-listed ETFs the 0 commission would be attractive?
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Old 17-02-2020, 04:39 PM   #1787
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By the way I forgot to ask about IBKR Lite (I don't remember there was such thing when I opened my account two years ago). Please correct me if I'm wrong but for those who only invest in LSE-listed ETFs the only benefit of Lite over Pro is the lack of monthly min $10 fee?
That's right.

I guess if you're based in the US and exclusively buy US-listed ETFs the 0 commission would be attractive?
Whether or not you're based in the U.S., if you have a total account value under US$100,000 the elimination of the US$10/month minimum commission would be attractive. Right now IBKR Lite is only available to residents of the United States and of India.
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Old 17-02-2020, 05:57 PM   #1788
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Thanks for the confirmation!
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Old 18-02-2020, 05:07 PM   #1789
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Notable CPF Updates in Budget 2020

The government has announced some notable CPF-related updates:

1. The 2020 Basic Retirement Sum is $90,500. We now have clarity on the Basic Retirement Sum for 2021 ($93,000) and 2022 ($96,000). This progression is almost exactly a 3% per year nominal compounded increase for the next 2 years. The Full Retirement Sum is 2X these figures, and the Enhanced Retirement Sum is 3X these figures.

2. I'm pleased to see that the government is introducing the "Matched Retirement Savings Scheme." This'll be open to about 425,000 older, low to moderate income Singaporean citizens from 2021 to 2025. The government will match the first $600 in Retirement Account cash top ups per year for this cohort, dollar for dollar. It's not exactly the way I would have done it (per some previous comments I made), but it looks decent.

3. No news yet on the Lifetime Retirement Investment Scheme (LRIS). Maybe the government is a little busy at the moment, but we're approaching 4 years since the LRIS was officially mooted. It'd be nice if the government at least said something like, "We're working on it."

4. There's an increase in the Silver Support Scheme.
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Old 18-02-2020, 07:55 PM   #1790
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That's right.


Whether or not you're based in the U.S., if you have a total account value under US$100,000 the elimination of the US$10/month minimum commission would be attractive. Right now IBKR Lite is only available to residents of the United States and of India.
Any news when IBKR Lite will be made available to Singapore investors?
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Old 18-02-2020, 08:43 PM   #1791
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That's right.


Whether or not you're based in the U.S., if you have a total account value under US$100,000 the elimination of the US$10/month minimum commission would be attractive. Right now IBKR Lite is only available to residents of the United States and of India.
Hi BBCW, do you have any suggestions for US banks/brokerage firms? Oversimplifying a bit, but I can't think of many specific needs other than convenience (ATM availability, at least around NYC area, where I'd be studying) and low to zero commission for US-domiciled ETFs (I noticed Vanguard and Fidelity seem to be quite popular in the Bogleheads forum). *Edit: low/no wire transfer cost and overseas ATM fees would be good to have, but it seems like the former is not very common in the US?

Anything that I should be looking for (or avoid)? Seems like most of the banks have some sort of basic 0 fee student credit cards which don't require credit scores or SSN (though I should be getting SSN prior to my summer internship). For what it's worth my brother who has been there for a while added me for a supplementary Amex card, which I've been using for a few months, so it might give me a short credit history (unsure if supplementary cards count).

Thanks, and sorry in advance if this is getting too far off-topic for the thread.
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Old 18-02-2020, 09:38 PM   #1792
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Any news when IBKR Lite will be made available to Singapore investors?
Only Interactive Brokers knows if/when that'll ever happen.

Hi BBCW, do you have any suggestions for US banks/brokerage firms? Oversimplifying a bit, but I can't think of many specific needs other than convenience (ATM availability, at least around NYC area, where I'd be studying) and low to zero commission for US-domiciled ETFs (I noticed Vanguard and Fidelity seem to be quite popular in the Bogleheads forum). *Edit: low/no wire transfer cost and overseas ATM fees would be good to have, but it seems like the former is not very common in the US?

Anything that I should be looking for (or avoid)? Seems like most of the banks have some sort of basic 0 fee student credit cards which don't require credit scores or SSN (though I should be getting SSN prior to my summer internship). For what it's worth my brother who has been there for a while added me for a supplementary Amex card, which I've been using for a few months, so it might give me a short credit history (unsure if supplementary cards count).
Yes, you probably have a basic U.S. credit history as a supplementary card holder. It won't be tied to a U.S. Social Security Number (SSN) yet, so it might not be worth much.

OK, for credit cards that don't require much or any credit history, I suggest:

* Capital One Journey Student Rewards
* Deserve EDU

You don't actually have to be a student to qualify for the first one, at least. Both are zero foreign transaction fee credit cards, and both offer decent cash rebates. Set them up for AutoPay from your U.S. bank or U.S. credit union account, please.

For bank/credit union accounts I suggest Alliant Credit Union and/or Charles Schwab Bank. Both offer fabulous zero foreign transaction fee ATM cards that rebate local ATM operator fees, even internationally. (Not that you'll need much cash these days, and it's a bad idea to carry much.) Schwab should have branches in New York if you want to apply in person, but it should be possible to apply for either/both online, at least once you have a SSN. Just be aware that Charles Schwab Bank reportedly doesn't tolerate non-U.S. mailing addresses, so keep a U.S. mailing address (such as your brother's) on that account if you want to keep it open. I don't suggest any of the majors since their fee structures are going to be bad.

For brokers you've also got tons of choices. Interactive Brokers with their IBKR Lite account is an excellent choice since you can also use it for Singapore dollar to U.S. dollar conversion and transfer. (Although if you can bring a good card from Singapore for your initial spending, such as the ICBC Global Travel Mastercard, that'd be helpful.) If you qualify for a Roth IRA (i.e. have U.S. "W-2" income) then Fidelity, Schwab, and Vanguard all have compelling offers. Fidelity's "zero" mutual funds are particularly lovely (FZROX and FZILX).

Are you all set on U.S. medical insurance? That's really important in the United States. I recall one Singaporean who took up a work assignment in the U.S. who then decided it would be a good idea to opt out of his employer-provided medical insurance because the employee's share of the premium seemed a bit high. And that's absolutely, utterly insane. I cannot emphasize enough how crazy expensive medical care can be/often is in the United States, particularly without insurance. Just as one of many stories, there's a medical insurance company in Utah that pays policyholders who need certain prescription drugs US$500 plus a free roundtrip airline ticket and a private car to go across the border to Mexico to pick up their prescriptions. Yes, it's that crazy, and more. You want coverage from the moment you board the plane in Singapore.
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Old 18-02-2020, 10:24 PM   #1793
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Yes, you probably have a basic U.S. credit history as a supplementary card holder. It won't be tied to a U.S. Social Security Number (SSN) yet, so it might not be worth much.

OK, for credit cards that don't require much or any credit history, I suggest:

* Capital One Journey Student Rewards
* Deserve EDU

You don't actually have to be a student to qualify for the first one, at least. Both are zero foreign transaction fee credit cards, and both offer decent cash rebates. Set them up for AutoPay from your U.S. bank or U.S. credit union account, please.

For bank/credit union accounts I suggest Alliant Credit Union and/or Charles Schwab Bank. Both offer fabulous zero foreign transaction fee ATM cards that rebate local ATM operator fees, even internationally. (Not that you'll need much cash these days, and it's a bad idea to carry much.) Schwab should have branches in New York if you want to apply in person, but it should be possible to apply for either/both online, at least once you have a SSN. Just be aware that Charles Schwab Bank reportedly doesn't tolerate non-U.S. mailing addresses, so keep a U.S. mailing address (such as your brother's) on that account if you want to keep it open. I don't suggest any of the majors since their fee structures are going to be bad.

For brokers you've also got tons of choices. Interactive Brokers with their IBKR Lite account is an excellent choice since you can also use it for Singapore dollar to U.S. dollar conversion and transfer. (Although if you can bring a good card from Singapore for your initial spending, such as the ICBC Global Travel Mastercard, that'd be helpful.) If you qualify for a Roth IRA (i.e. have U.S. "W-2" income) then Fidelity, Schwab, and Vanguard all have compelling offers. Fidelity's "zero" mutual funds are particularly lovely (FZROX and FZILX).
Thanks, I'll check those options. I agree that keeping the IBKR account would be convenient since I'd most definitely keep one or two of my Singapore bank accounts as well. I was thinking that I'd be able to maintain the minimum threshold for IBKR to not charge a monthly minimum, but I guess with Lite that won't even be necessary. Please correct me if I'm wrong, but there seem to be four (?) kinds of accounts that will be relevant for me: 401(k), Roth 401(k), IRA, and Roth IRA, where I'd put post-income tax money into the Roth versions and not get taxed on redemption, while I'd get tax deductions for putting money into the non-Roth variants but get taxed on redemption at income tax rates. This seems to imply that the Roth versions would be beneficial if I expect to earn more (thus getting taxed at higher brackets) in the future?

I think I'll keep my current IWDA/EIMI holdings for the remaining of this year, and shift them to US-domiciled alternatives nearing the end of the year as I'll be planning to graduate by the end of 2021 and hopefully start working full-time around then. I've looked up some info online and it seems like CPF won't be taxed even if I become a US tax resident, but I'm a bit confused regarding how SSB would be treated (there won't be any capital gains, but maybe withholding tax on the dividends?).

Are you all set on U.S. medical insurance? That's really important in the United States. I recall one Singaporean who took up a work assignment in the U.S. who then decided it would be a good idea to opt out of his employer-provided medical insurance because the employee's share of the premium seemed a bit high. And that's absolutely, utterly insane. I cannot emphasize enough how crazy expensive medical care can be/often is in the United States, particularly without insurance. Just as one of many stories, there's a medical insurance company in Utah that pays policyholders who need certain prescription drugs US$500 plus a free roundtrip airline ticket and a private car to go across the border to Mexico to pick up their prescriptions. Yes, it's that crazy, and more. You want coverage from the moment you board the plane in Singapore.
Yes I understand the importance of health insurance. I'll still have a few months' worth of remaining coverage from GE's private integrated shield plan before I stop renewing, which covers emergency medical treatments outside of Singapore on an as-charged basis (capped at Singapore private hospital charges). That should give me sufficient coverage until the university student insurance kicks in at the start of the semester.

The university that has admitted me (Columbia) offers student health insurance that'll cost up to roughly USD3k/year, administered by Aetna (https://www.aetnastudenthealth.com/s...ia/sbc1920.pdf). I haven't scrutinized the details but at a glance it seems to be sufficient. I haven't officially accepted the admission offer yet, since I'm still waiting for Princeton, though I'd imagine they have comparable insurance over there too.
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Old 18-02-2020, 11:22 PM   #1794
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Please correct me if I'm wrong, but there seem to be four (?) kinds of accounts that will be relevant for me: 401(k), Roth 401(k), IRA, and Roth IRA, where I'd put post-income tax money into the Roth versions and not get taxed on redemption, while I'd get tax deductions for putting money into the non-Roth variants but get taxed on redemption at income tax rates. This seems to imply that the Roth versions would be beneficial if I expect to earn more (thus getting taxed at higher brackets) in the future?
401(k) plans are employer-sponsored. [If you're interning for a not-for-profit organization, then it'd be a 403(b) plan -- essentially the same thing.] All such plans offer the "Traditional" variant, which means you contribute from pre-tax income. Some such plans offer a choice of a "Roth" variant, which means contributions are post-tax.

IRAs are available in your choice of Traditional (pre-tax) and Roth (post-tax). Yes, you can contribute to both a 401(k) plan and an IRA, subject to certain other eligibility requirements, notably having earned income ("Form W-2 income").

In my view the "Roth" variant works better for those from Singapore and in many other cases. Income tax rates are rather low right now, and it's reasonable to assume they'll be higher in the future.

Please be aware that at Columbia there is also New York City and New York State income tax. At Princeton there's a New Jersey state income tax, but I don't think there's any municipal income tax in Princeton, New Jersey.

I think I'll keep my current IWDA/EIMI holdings for the remaining of this year, and shift them to US-domiciled alternatives nearing the end of the year as I'll be planning to graduate by the end of 2021 and hopefully start working full-time around then.
It'd be prudent to ditch what the U.S. tax code considers PFICs before you become fully subject to the U.S. tax code, preferably sometime the calendar year before that. IWDA and EIMI are definitely PFICs. It's legal to hold them, but they're very unfavorable from a U.S. tax point of view. Same with appreciated assets, to (carefully) reset the cost basis if allowed.

I've looked up some info online and it seems like CPF won't be taxed even if I become a US tax resident, but I'm a bit confused regarding how SSB would be treated (there won't be any capital gains, but maybe withholding tax on the dividends?).
That's incorrect. When you're fully a U.S. tax resident your worldwide income is taxable, including CPF and SSB interest. There is no tax treaty between the U.S. and Singapore that says otherwise. It's just another (foreign) account from the point of view of the U.S. tax code. It doesn't matter that you cannot withdraw the funds before age 55, or that they're earmarked for medical care. It's interest, it counts, and it's taxable, at ordinary rates.

I think you're initially on a J-1 visa, though, right? That'll be a status that keeps your offshore (non-U.S.) passive income, such as CPF interest, out of the U.S. tax system, for a while anyway. If/when you shift to some other visa arrangement or stay long enough, that'll probably change. Plus you'd pick up the U.S. FinCEN Form 114 ("FBAR") and potentially other foreign financial account reporting requirements, such as IRS Form 8938 ("FATCA").

Yes I understand the importance of health insurance. I'll still have a few months' worth of remaining coverage from GE's private integrated shield plan before I stop renewing, which covers emergency medical treatments outside of Singapore on an as-charged basis (capped at Singapore private hospital charges). That should give me sufficient coverage until the university student insurance kicks in at the start of the semester.
Oh hell no, not even close to enough coverage. I'm glad I mentioned it!

First of all, due to preexisting condition rules (and emergency fallback) it'd probably be prudent to maintain your Great Eastern coverage in Singapore even while you're in the U.S. But you can downgrade to the B Plus plan (or A Plus if you're not a Singaporean citizen), plus corresponding TotalCare Classic rider if you wish, and that'll reduce the premium quite a bit while still preserving foundational public hospital coverage back in Singapore. I believe you're allowed to do all that.

To "bridge" into your U.S. student insurance you'll need travel medical insurance, either a single trip plan or an annual plan. The only U.S. adequate travel medical insurance plan I've seen sold in Singapore is Allianz's since they offer a no limit plan (unlimited emergency medical coverage). Non-Singaporean carrier Bupa Global's base plan is unlimited, too, and you can buy that online. With rare exceptions, by law U.S. medical insurance cannot have an annual or lifetime coverage limit. There's a reason for that!

Anyway, read the travel medical policy terms carefully, but you want to have either a single trip policy that lasts at least a day after your Columbia student plan is supposed to start or an annual plan with a per trip limit (number of days) that lasts at least a day after your student plan is supposed to start. That is, you do not want any break in coverage, from the moment you board the plane in Singapore until you're safely back in Singapore. Not even a nanosecond. Seriously, it's that important.

The university that has admitted me (Columbia) offers student health insurance that'll cost up to roughly USD3k/year, administered by Aetna (https://www.aetnastudenthealth.com/s...ia/sbc1920.pdf). I haven't scrutinized the details but at a glance it seems to be sufficient. I haven't officially accepted the admission offer yet, since I'm still waiting for Princeton, though I'd imagine they have comparable insurance over there too.
That Columbia plan is U.S. Patient Protection and Affordable Care Act (PPACA) compliant, and it's a good one. Your out of pocket costs for covered services with "in network" medical providers are capped at US$3,000 per year, which is rather good by U.S. standards these days. There is no annual or lifetime limit. New York and the two neighboring states (New Jersey and Connecticut) have fairly strong protections against "balance billing," so you should be in good shape all around. Make sure you read and understand the policy rules, of course. As examples, you must have a referral to see a specialist, and some care requires pre-authorization before it'll be covered. Pro tip: If you need any vaccinations, such as a Tetanus booster, get them from an "in network" medical provider under this plan before you leave. They're free. Check the full list of preventive services that are fully covered without a co-pay/deductible and see what else you can legitimately use.

Please note that the U.S. medical insurance doesn't cover medical repatriation back to Singapore, nor does your Great Eastern Integrated Shield policy (current or downgraded), at least not much. "Medical repatriation" means the specialized transport to get you from the U.S. back to Singapore once you're medically stable and decide to "abandon ship," as it were. Also, the U.S. medical insurance doesn't cover long-term care -- long-term nursing home care, in particular -- and that'll be an "abandon ship" event.

Let me give you just one example of how foolish it would be to drop into the U.S. with only your Great Eastern Integrated Shield plan. I believe your current plan pays something like S$150 for an A&E visit since that's what the public hospital A&E charges, and all SCDF ambulances (free for legitimate emergencies) take you to the nearest public hospital A&E. But let's go crazy and assume that Great Eastern would pay S$600.

So how far would S$600 get you in a U.S. hospital emergency room? Well, the ambulance alone will likely bill US$1,000+, the Emergency Room visit -- stepping into the ER I mean -- can easily run US$2,000+, and you haven't seen a doctor or received an aspirin yet. Several years ago one of my family members had to go to an ER in the U.S., got a quick physical check, some antibiotics, and a Tylenol pill (equivalent to Panadol) and that was it, literally. The bill was US$4,500. That was without an ambulance ride. Fortunately everything was fine, but it merited a trip to the ER since there wasn't any other option. And next fortunately this family member was properly insured. That US$4,500 bill was only the opening bid, the practical minimum for an ER visit without an ambulance ride -- and several years ago now. ICU? Oh, good lord.... Most people have no idea how crazy it is, and now you know.
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Old 19-02-2020, 12:34 AM   #1795
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Oh wow that's a long one, thanks!

In my view the "Roth" variant works better for those from Singapore and in many other cases. Income tax rates are rather low right now, and it's reasonable to assume they'll be higher in the future.
So if I simplify a bit, the priority, given availability would be Roth 401(k) (or similar other plans), then traditional 401(k) (as these two would be matched by the employer, up to certain percentage), up to the limit (seems to be USD19k for both combined). And then after reaching the limit for those, I'll contribute to Roth IRA, and then traditional IRA (USD6k combined limit, and the Roth version is only available for those earning up to USD139k/year). These would all add up to a maximum of USD25k tax advantaged investments in a year, and anything on top of that could be placed in non-tax advantaged accounts such as my IBKR for example. Would that be correct?

Please be aware that at Columbia there is also New York City and New York State income tax. At Princeton there's a New Jersey state income tax, but I don't think there's any municipal income tax in Princeton, New Jersey.
Yes I'm aware of state/city taxes, though I wonder if this would be dependent on the location of the company/organization I'm interning/working for, or my address of residence? (e.g. if I stay in Princeton but work in an NYC-based firm)

That's incorrect. When you're fully a U.S. tax resident your worldwide income is taxable, including CPF and SSB interest. There is no tax treaty between the U.S. and Singapore that says otherwise. It's just another (foreign) account from the point of view of the U.S. tax code. It doesn't matter that you cannot withdraw the funds before age 55, or that they're earmarked for medical care. It's interest, it counts, and it's taxable, at ordinary rates.
Thanks, I stand corrected on this one.

I think you're initially on a J-1 visa, though, right? That'll be a status that keeps your offshore (non-U.S.) passive income, such as CPF interest, out of the U.S. tax system, for a while anyway. If/when you shift to some other visa arrangement or stay long enough, that'll probably change. Plus you'd pick up the U.S. FinCEN Form 114 ("FBAR") and potentially other foreign financial account reporting requirements, such as IRS Form 8938 ("FATCA").
It should be an F-1 visa (treated equally as J-1 visa for tax treatment, if I recall correctly). I'll be on F-1 visa for a while, though ultimately depending on how much I enjoy staying/working in the US, I might look for H-1B and gain a few years' worth of work experience under my belt, this is the big uncertainty in my plan, which I want to prepare for rather than getting taxed on this-and-that because I converted to H-1B with my asset allocations optimized for non-US taxes.

This is really complicated. I guess there's a good reason why those banks/brokers ask people to sign forms declaring themselves to be non-US persons.

Oh hell no, not even close to enough coverage. I'm glad I mentioned it!

First of all, due to preexisting condition rules (and emergency fallback) it'd probably be prudent to maintain your Great Eastern coverage in Singapore even while you're in the U.S. But you can downgrade to the B Plus plan (or A Plus if you're not a Singaporean citizen), plus corresponding TotalCare Classic rider if you wish, and that'll reduce the premium quite a bit while still preserving foundational public hospital coverage back in Singapore. I believe you're allowed to do all that.

To "bridge" into your U.S. student insurance you'll need travel medical insurance, either a single trip plan or an annual plan. The only U.S. adequate travel medical insurance plan I've seen sold in Singapore is Allianz's since they offer a no limit plan (unlimited emergency medical coverage). Non-Singaporean carrier Bupa Global's base plan is unlimited, too, and you can buy that online. With rare exceptions, by law U.S. medical insurance cannot have an annual or lifetime coverage limit. There's a reason for that!
Okay that was most certainly beyond my wildest imagination...

So I went to Allianz Singapore website and looked around for a bit, these highlighted parts are probably what I should be looking out for right? (Ignore the dates, I'll adjust the travel period once I've confirmed my travel dates)



Edit:If we assume that I'm going to be away from Singapore for a few years, would it make sense (or is it even possible) to downgrade to the lowest integrated shield plan (GE supremehealth standard), drop the rider completely, just to prevent the existing condition from resetting, and then upgrading it back to private and getting a new rider when I return to Singapore? I presume your suggestion to keep the basic rider and downgrading to B/A plan is to cover in case I choose to get hospitalized in Singapore, rather than in the US using my university insurance?

Thanks again, and sorry for the super long posts!

Last edited by lemniscate; 19-02-2020 at 12:42 AM..
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Old 19-02-2020, 08:41 AM   #1796
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Hi BBCW. I wish to check with you on a "metal trading" investment scheme that promises high-risk, high-returns. When I heard about this, to my mind, it is probably "scam" aka "too good to be true". Nonetheless, I wish to understand how it works.

I only have brief details. My uncle was approached by a private investment fund house representative. He was offered to participate in this" metal trading" investment scheme which was only open to accredited investors. He had to invest a capital sum of $100k which was apparently capital protected, and would receive non-guaranteed payouts of about $10k every 3 months. He participated in the scheme and had since received 3 tranches of quarterly payouts totalling about $30k.

For your views, pls. Thank you.

* I am ready to be trolled for this apparently ridiculous post.

Last edited by mr_beanz; 19-02-2020 at 09:09 AM..
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Old 19-02-2020, 08:43 AM   #1797
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So if I simplify a bit, the priority, given availability would be Roth 401(k) (or similar other plans), then traditional 401(k) (as these two would be matched by the employer, up to certain percentage), up to the limit (seems to be USD19k for both combined).
The priority is really to collect every dollar of employer matching funds. Past that (past the employer's matching fund limit), it doesn't particularly matter whether you're contributing to the employer's plan or to your own IRA since the tax advantages are the same. The IRA is more flexible because everything your U.S. broker offers is available, which is a vast selection. Most 401(k) and 403(b) plans offer very good, low cost investment choices nowadays, but the choices are more limited and sometimes they're questionable.

The annual 401(k) and 403(b) plan contribution limit is now US$19,500 (2020 figure), excluding the additional amount that workers age 50 and older are permitted. Also, the Roth variant of the 401(k) or 403(b) plan, if offered, effectively allows a higher contribution since the same contribution limit applies.

Pro tips: If you start getting employment income mid-year, and if you can afford it, see if you can temporarily raise your 401(k) or 403(b) plan contribution percentage in order to hit or at least get near the annual maximum. Also, if your employer's plan offers a "match maximizer" or similar mechanism, you'll probably want to use that feature.

OK, so to recap, I'd do it in this priority order of dollars available for saving:

1. Max out the employer's matching funds in the 401(k) or 403(b) plan (using the Roth variant I suggest);

2. Max out your IRA contribution (Roth variant again I suggest);

3. Max out the remainder of the 401(k) or 403(b) plan limit. (The Roth variant effectively allows a higher limit than Traditional since Roth contributions are after tax.)

4. If you want to get really "crazy" then some 401(k) and 403(b) plans let you contribute above US$19,500 per year to a separate subaccount, which I think is treated as nondeductible (after tax). Once you separate from the employer you're then generally allowed to roll that particular nondeductible subaccount over into your own Roth IRA, paying income tax at that time on the gains only (and at ordinary income tax rates, not at preferred capital gains rates, as I recall). Once in the Roth IRA, it's U.S. tax free thereafter (assuming no premature withdrawals). So this subaccount, if offered, effectively allows you to bust the $25,500 per year contribution limit. There's some higher aggregate 401(k)/403(b) limit that applies in this case, but I think it's $5X,000 per year, so potentially using this path if it's offered you could stuff another $3X,000 per year into a Roth IRA, eventually. I managed to take advantage of this "hack," and it was/is lovely, for me anyway. "Your mileage may vary."

And then after reaching the limit for those, I'll contribute to Roth IRA, and then traditional IRA (USD6k combined limit, and the Roth version is only available for those earning up to USD139k/year).
Not actually. There's something called a "Backdoor Roth IRA," and it works like this:

1. Make a nondeductible, Traditional IRA contribution.

2. Invest the funds in something safe for a couple months, like a U.S. T-Bill or short-term U.S. Treasury fund.

3. After the couple months, convert the whole Traditional IRA to a Roth IRA. Invest your Roth IRA (and other tax advantaged accounts) in the most aggressive vehicles within your total wealth. (That's a basic principle of tax advantaged accounts, to put the long-term highest yielding stuff within them to max out the tax advantages.)

4. If your $6,000 contribution turns into $6,005 (let's suppose) by the time you convert to a Roth IRA, then you'll report $5 of income on your tax returns and pay tax on that.

For some weird reason there's an income limit for direct Roth IRA contributions but no income limit for nondeductible Traditional IRA contributions and no income limit for Traditional IRA to Roth IRA conversions/rollovers. You'll need to make sure that you convert all Traditional IRA funds and have no other Traditional IRAs. (This doesn't really work for people with lots of funds in Traditional IRAs that have appreciated.) But since you don't have any IRAs now this part is easy.

These would all add up to a maximum of USD25k tax advantaged investments in a year, and anything on top of that could be placed in non-tax advantaged accounts such as my IBKR for example. Would that be correct?
US$25,500 (2020 figure, under age 50) per year, to be precise.

Note that 401(k) and 403(b) plan contributions are calendar year based, but you have until April 15 of the following year to make IRA contributions for the previous year. I wouldn't wait that long, though. Once you know you qualify for an IRA contribution (have enough "W-2 income"), I'd go for it. And of course don't wait that long to open the IRA and deposit a dollar if that's what's required to open it. The IRA account opening process probably isn't instantaneous.

Yes I'm aware of state/city taxes, though I wonder if this would be dependent on the location of the company/organization I'm interning/working for, or my address of residence? (e.g. if I stay in Princeton but work in an NYC-based firm)
Yes.

That's a bit complicated, actually, but if you're a "cross border" worker the various tax authorities have rules about how that all works. I believe the basic, typical rule is that you pay the workplace's income tax jurisdiction(s) first, then you pay the tax jurisdiction covering your place of residence if there's any additional income tax owed (if your place of residence has a higher tax rate on that income and you need to pay the difference).

Regarding H-1B1 status (you'll be H-1B1 as a Singaporean citizen, I assume) -- or really any visa status or even undocumented/non-status (staying without permission; don't do that) -- the IRS applies something called the "substantial presence test" to determine whether your worldwide income and assets are subject to U.S. tax jurisdiction or not. So just take a look at that test and try to position yourself better in the calendar year preceding the calendar year when you cross that "substantial presence" threshold. If you fall in love, marry an American, get a green card (permanent residence), and live happily ever after, then you definitely cross the threshold.

So I went to Allianz Singapore website and looked around for a bit, these highlighted parts are probably what I should be looking out for right?
Highly preferably you want "unlimited" next to the emergency medical coverage line, which Allianz Singapore offers in their single trip "Gold" plan for example. Unless the number is a stonking big number, like 8 digits big, which is probably OK for these purposes.

Versus the sample quotation you provided Bupa Global's base annual plan (British pound price) is less expensive, actually, and would work fine as long as your pre-insurance stay entirely fits within their maximum trip length.

Your Aetna (or similar) U.S. insurance policy, once you're covered and stay covered, probably works pretty well for your international travel outside the U.S. -- for a vacation in Canada, Europe, or wherever. U.S. private medical insurance almost always covers emergency medical care outside the United States, and happily so since it's so much less expensive. Check the policy terms, of course, but that's pretty typical. Less common is medical repatriation coverage, but sometimes even that is covered.

Edit:If we assume that I'm going to be away from Singapore for a few years, would it make sense (or is it even possible) to downgrade to the lowest integrated shield plan (GE supremehealth standard), drop the rider completely, just to prevent the existing condition from resetting, and then upgrading it back to private and getting a new rider when I return to Singapore?
I wouldn't go that low. At your likely age the "as charged" public hospital B1 plan (Supreme Health B Plus) is going to be within a very few dollars of the Standard Plan. The TotalCare Classic rider (lowest cost rider) for that B Plus plan is fine, too. Preexisting condition exclusions apply to both the base plan and the rider, so if you drop the rider completely (for example) then you have to assume you might not get back in.

The basic issue here is that, as a Singaporean citizen (I assume) you've got one country where you have an unambiguous, firm right of abode: Singapore. So you have to presume that you'll be coming back to Singapore until two things are true: (1) you have a firm right of abode elsewhere, and (2) you intend to stay in that other country. And if you're inevitably coming back to Singapore (you must presume), then do you want to come back with only MediShield Life due to preexisting condition exclusions? I vote no, personally, so I'd maintain the next sensible level of coverage above MediShield Life, which in your case would be Great Eastern's Supreme Health B Plus and TotalCare Classic rider -- a very fine combination for Singaporean citizens/best in class, actually. At your age (guessing) this combo is quite affordable, and you have perfectly respectable coverage if/when you land back in Singapore, with or without new preexisting conditions.

I presume your suggestion to keep the basic rider and downgrading to B/A plan is to cover in case I choose to get hospitalized in Singapore, rather than in the US using my university insurance?
It's really about the future and the way preexisting condition exclusions work (really don't work) in Singapore.

In anticipation of Integrated Shield plan premiums during your U.S. sojourn, check your MediSave balance. If it's in good shape, great, but if it could use some more dollars, if you could use the tax relief, and if you have room below the CPF Annual Limit, give some consideration to topping up your MediSave Account.

Oh, one other thing: if you can record nontrivial U.S. Social Security contributions within 10 calendar years, i.e. at least 40 "credits," then you'll qualify for future U.S. Social Security retirement benefits plus potentially some other benefits. If you're at the 3 year mark and decide you've had enough, OK, fair enough. On the other hand, if you're at the 8 year mark and trying to decide whether to head back or not, see if you can hang on to get those magic 40 credits -- and count carefully. It'd be really terrible to end up with 39.

In the year 2020 you need US$1,410 of U.S. Social Security taxable income (earned income, a.k.a. "W-2 income") to earn one Social Security credit. The maximum you can earn within a calendar year is 4 credits, and US$5,640 (4X 1410) will do it. Each year this figure is raised a bit for inflation. As you can see, if you start work in October and earn US$7,000 for 2020 (let's suppose), that's enough to clock all 4 credits in 2020. Likewise, if you leave in March, 2029, after clocking US$9,500 of earnings in 2029 (let's suppose), that should be enough for all 4 Social Security credits that year. So you can get to the magic 40 credits with as little as 8-point-something years of work, and with short periods of non-work interspersed. (Hypothetically as few as 10 paychecks will do it, if the paychecks are each big enough and each is within a separate calendar year.) If you hit at least 6 credits and then head off to Germany (for example, one of the many Social Security treaty countries) and work 8+ years there, contributing to their social insurance system, then U.S. Social Security can "totalize" your contributions into the German system in order to qualify you for U.S. benefits, and potentially vice versa (Germany counting your U.S. credits toward minimum qualification).

....OK, I'll stop there.

Last edited by BBCWatcher; 19-02-2020 at 08:45 AM..
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Old 19-02-2020, 09:25 AM   #1798
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For those of you with a dividend fetish who are not focused instead on total long-term net returns, this article comparing Amazon and Walmart may be revelatory. Over the past 10 years, as I write this, here are the gross annualized yields for Walmart and Amazon stock:

WMT: 10.95%
AMZN: 33.72%

These figures assume that all dividends have been reinvested (Amazon hasn't paid any, ever) with zero commissions and zero dividend tax. So obviously WMT's net annualized yield is lower in reality while AMZN's is basically correct (just subtract the broker commission). And here's what a US$10,000 investment ten years ago has turned into (again, gross figures, which cast Walmart in a more favorable light):

WMT: $28,079
AMZN: $181,892

Source: https://dqydj.com/stock-return-calculator/

This is the sort of result that's possible (of course not guaranteed) when investors give a company's management the freedom to invest earnings in the business itself instead of distributing earnings to shareholders via cash dividends and share repurchases.

As an additional point of comparison, Walmart has slightly underperformed the S&P 500 index which had an annualized gross yield of about 11.36% over this same period. I should also mention that none of this should be taken as investment advice, except as a reminder that (in my view) you should not be a "dividend investor."

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Old 19-02-2020, 09:52 AM   #1799
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And Bernie tells me that WMT is a bad boy for underpaying employees and taxes....
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Old 20-02-2020, 12:04 AM   #1800
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Hi there, sorry for the slow response, a bit hard to type a long post on my phone. Your explanation on tax advantaged accounts are really helpful, I don't have any more questions for the moment (more like I haven't done enough research to ask further).

Highly preferably you want "unlimited" next to the emergency medical coverage line, which Allianz Singapore offers in their single trip "Gold" plan for example. Unless the number is a stonking big number, like 8 digits big, which is probably OK for these purposes.

Versus the sample quotation you provided Bupa Global's base annual plan (British pound price) is less expensive, actually, and would work fine as long as your pre-insurance stay entirely fits within their maximum trip length.
Sure, I'll take a closer look at the available options once I've confirmed the travel dates. I'm not sure but I might want to travel around for a week or two prior to the beginning of the university orientation/bootcamp stuffs, but I'll be sure to get enough coverage from my departure until the beginning of the university insurance.

I wouldn't go that low. At your likely age the "as charged" public hospital B1 plan (Supreme Health B Plus) is going to be within a very few dollars of the Standard Plan. The TotalCare Classic rider (lowest cost rider) for that B Plus plan is fine, too. Preexisting condition exclusions apply to both the base plan and the rider, so if you drop the rider completely (for example) then you have to assume you might not get back in.

The basic issue here is that, as a Singaporean citizen (I assume) you've got one country where you have an unambiguous, firm right of abode: Singapore. So you have to presume that you'll be coming back to Singapore until two things are true: (1) you have a firm right of abode elsewhere, and (2) you intend to stay in that other country. And if you're inevitably coming back to Singapore (you must presume), then do you want to come back with only MediShield Life due to preexisting condition exclusions? I vote no, personally, so I'd maintain the next sensible level of coverage above MediShield Life, which in your case would be Great Eastern's Supreme Health B Plus and TotalCare Classic rider -- a very fine combination for Singaporean citizens/best in class, actually. At your age (guessing) this combo is quite affordable, and you have perfectly respectable coverage if/when you land back in Singapore, with or without new preexisting conditions.
I'm actually Indonesian, and a Singapore PR, so whether I would (or even be able to) return to Singapore is not guaranteed. I will definitely consider your suggestion to maintain my integrated shield plan to prevent the pre-existing conditions to be reset. There is a lot more uncertainty in my case than what you've described as I may not be a PR (or may never be one anymore) by the time I leave the US.

Given the relatively (substantially) more expensive premiums of expat/global insurance plans such as the Cigna's Global Platinum, at what point do you think it'd make sense for me to look at those? I recall I've played around with Cigna's configurator, even with reasonable deductible/coinsurance they still cost over USD4k/yr with outpatient treatment and medical repatriation and I'm still under 30. I shudder to think of how much they'd cost when I'm 50.
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