Vanguard Account

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Yo Teach'
Posts: 18
Joined: Mon Jul 07, 2014 1:46 am

Vanguard Account

Post by Yo Teach' »

Hello,

My first year as an IT is almost over, and it was amazing! In a few weeks I'm heading back to the US and want to open some Vanguard index funds. The trouble is Vanguard doesn't allow US Expat's to open new accounts. I have maintained a US address and phone number, but part of the application makes you indicate your current employment status. Can/should I mark myself unemployed, retired, self employed, or what? I just know that I can list myself as currently employed by an international school. Any thoughts?

Thanks!

santacruzin1
Posts: 22
Joined: Mon Dec 07, 2015 6:30 am

Re: Vanguard Account

Post by santacruzin1 »

I was able to open an account while abroad, by using my parent's address. I believe I put that I was unemployed during the application. I think the most important thing is that you have a residential U.S. address.

santacruzin1
Posts: 22
Joined: Mon Dec 07, 2015 6:30 am

Re: Vanguard Account

Post by santacruzin1 »

I was able to open an account while living abroad. I believe I put that I was unemployed, but cannot remember for certain. I used my parent's address as my address, and it worked out fine. I think the most important thing is to have a U.S. address.

PsyGuy
Posts: 9886
Joined: Wed Oct 12, 2011 9:51 am
Location: Northern Europe

Response

Post by PsyGuy »

It doesnt really matter what you mark:

1) If you have a contract for next year at a upper tier IS thats not in the ME or on the OFAC list than mark employed.

2) If your in an OFAC region and you have a contract for next year mark self employed.

3) If you dont have a contract either mark self employed or unemployed.

4) If your retired dont mark retired, youll have to deal with a sales pitch that will be long and boring and not in your best interests.

It really doesnt matter, the information shapes the investment path of the advisor. If your employed your going to hear a pitch about how hard your 401K/IRA, etc. is working for you. If your self employed they are going to discuss your asset allocations, tax liability, and corporate business status (if you choose this route your a sole proprietor who provides general instructional services/tutoring/test prep/gold fish training). If your unemployed there going to look at you a little strange and maybe ask why your investing, or more accurately "How much you were looking to invest".
The only way to mess this up is to mention something thats OFAC related (OFAC is Office of Foreign Asset Control), legitimate bankers and investment advisors get nervous about anything that hints of possible OFAC involvement. Its a lot of paperwork, monitoring, and just not worth it for most investment professionals to manage your account/portfolio.

rake
Posts: 23
Joined: Thu Nov 26, 2015 5:42 am

Re: Vanguard Account

Post by rake »

You shouldn't have a problem as long as you have a US address for your primary residence. Assuming you know the Vanguard funds you would like to buy, you can do that yourself without ever dealing with an advisor. Vanguard also has joint accounts, so you can use the residence/employment info for someone like a parent or person with POA to open an account for "general savings" which you can then contribute to.

If you currently have a portfolio/investment advisor, you also have the option of buying ETF offerings of Vanguard funds, which gives you access to their products without opening an account directly with them.

Yo Teach'
Posts: 18
Joined: Mon Jul 07, 2014 1:46 am

Re: Vanguard Account

Post by Yo Teach' »

I currently do not have any Vanguard accounts. I think I'll go the self employed route or maybe unemployed. Will Vanguard require me to show my tax return as part of the opening a new account process? I plan to open everything online, so I shouldn't have to actually speak with anyone.

* In my opening post, I meant to say that I can NOT mark myself employed by and International School, as Vanguard will not let expats open new accounts.

rake
Posts: 23
Joined: Thu Nov 26, 2015 5:42 am

Re: Vanguard Account

Post by rake »

You shouldn't need a tax return, as long as you have a domestic bank account you are drawing funds from.

PsyGuy
Posts: 9886
Joined: Wed Oct 12, 2011 9:51 am
Location: Northern Europe

Reply

Post by PsyGuy »

@Yo Teach

No you are not required to produce a tax return to open an investment account with Vanguard.

There is nothing about you being an expat that prohibits Vanguard from creating an account with you. Vanguard has decided as a matter of policy that they dont want to incur the cost and expense of servicing overseas accounts. It has nothing to do with your appointment or job at an IS, living overseas or being an "expat". It really just comes down to four things:

1) Are you A US Citizen?
2) Do you have a passport or US Government issued for of identification?
3) Do you have a US Social Security Number?
4) Do you have an address in the US?

If the answer to all of those is yes, than what you do, where you work, where you are, and everything else that would be relevant to IE doesnt matter. The hardest one for many long term expats is the US Address. You can use a family member, mail forward service, or PO BOX.

Why this exists? US Patriot Act and OFAC. Financial Institutions need to verify certain types of information in establishing accounts as a measure against terrorism, and other financial crimes.

global_nomad
Posts: 72
Joined: Thu Jan 07, 2016 12:12 pm

Opening a Vanguard Account

Post by global_nomad »

Pretty simple, folks (Youtube tutorial about how to open a Vanguard acoount):

https://www.youtube.com/watch?v=OY_qIgt_SCA

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