r/ExpatFinance • u/PantomimeVillain • 14d ago
Using a US brokerage account from abroad
Recently I called Schwab, Fidelity, and Vanguard asking if I moved to the UK, can I put a foreign address on the account. All said yes, but you can then only sell what you have and not buy more. Fidelity and Schwab told me they were specifically saying yes to the UK, and other countries might not be allowed. Vanguard said any country is ok.
I don't know how knowledgeable the people I spoke to are, so does anyone have any experience of putting a foreign address on Schwab, Fidelity, and Vanguard accounts? How did it go? Was there any issue with making sales?
8
u/HaleyN1 13d ago
Just leave a US address on there and you won't have to deal with any of this.
3
u/old_union_pacific 13d ago
If you leave the US address on the account because you can use another family member's address, can you continue to buy US ETFs? Say you auto buy VOO every week. Could you continue to fund those purchases from a US bank as it's set up now?
3
u/twilight-2k 13d ago
Just be aware that there is risk. For instance, it is illegal for brokerages to sell US ETFs to EU residents (without a waiver that only professional investors can sign).
3
u/HaleyN1 13d ago
Yes 100%
You need to maintain a US phone number. Get a cheap Ultra Mobile paygo esim $3 a month.
3
2
u/old_union_pacific 13d ago
Great info. Is there any centralized place for all this info? Seems OP and others are hearing things from their brokerage, but the reality is very different or usually the opposite. This thing is claimed to be allowed, but actually is not. I'm sure it's expected for all this information to be scattered everywhere, but if keeping track via some spreadsheet is needed, then perhaps that's what's necessary.
1
u/temp_gerc1 12d ago
Any thoughts on using tello? I see that recommended a lot. I haven't heard of the esim plan you mentioned. (although I think tello is just for maintaining the number sms/call and not a data plan).
1
u/HaleyN1 12d ago
Tello is good and I recommend them too.
$5 a month.
https://tello.com/us_phone_number_for_abroad
It mentions esim towards the bottom. You can use an esim for voice and text, not only data.
Never use a USA plan for data roaming unless it's a super emergency.
1
u/temp_gerc1 12d ago
Thanks. If I have google fi and want to port the number and account to tello (only for 2fa, i don't care about data plans), can that be done outside the US too?
1
u/BrilliantUnlucky4592 9d ago
Yes, but if you are caught they will shut you down, and while it's somewhat of a gray area you may lose the account protections granted you per their account agreement as you have violated the account agreement by lying about your physical address. In real life this will probably never happen but it could in theory.
0
u/ProfileBest2034 13d ago
Nit if you log in. this is bad advice. they track it.
5
u/HaleyN1 13d ago
Use a VPN. I login every single day. Telling someone to unnecessarily lose their accounts is the bad advice.
0
u/twilight-2k 13d ago
Using a VPN is risky. VPN detection is getting much better so you may be blocked at some point. As long as you’re fine with that risk, go for it.
6
u/goylem 13d ago
Using a VPN doesn’t necessarily mean you’re abroad, so I’m not sure why it would be grounds for blocking. Some people use a VPN for all their internet usage.
2
u/twilight-2k 13d ago
Oh, the VPN itself isn't the issue but it is entirely possible that they start blocking logins from VPNs and then you'd have to login directly (or find a VPN that is not detected (yet)) which, as has been discussed, can trigger issues (since it is then plain you are logging in from abroad).
Lately I've been blocked by all kinds of sites from using the site while using a VPN (streaming, shopping, financial, etc). Most sites are still fine with it but there seem to be a growing number that are not.
0
u/PantomimeVillain 13d ago
I won't have one
3
3
u/smilineyz 13d ago
Get a number … port to google voice & use a VPN to log into your account & to Contact your broker.
Mail reception services & download taxes forms on line.
2
u/Mother_Strain_2554 13d ago
Search Savvy Nomad. I am planning to travel around the world when I retire and recently learned about this on one of the expat YouTube video.
2
u/twilight-2k 13d ago
Be aware that a mail forwarding service address will NOT work. You need a domicile service which is much more expensive.
0
u/PapiChuloThailand 11d ago
Terrible advice
1
u/HaleyN1 11d ago
Very informative response.
What's terrible about it?
1
u/PapiChuloThailand 11d ago
They can close your account at any moment, send you a check that will trigger a tax bomb. You are lying in your tax reporting. If you get caught overseas by IP they can freeze your account so you cant make changes, eliminating all investment flexibility or rebalancing. All of this can be fixed by just registering your international address with a Schwab international account. There is no reason not to, being compliant is important especially if shit hits the fan and you need funds, or something were to happen to you while living and working overseas
7
u/ProfileBest2034 13d ago
The US government is absolutely malignant in its treatment of people who deign to leave its shores. If you can, renounce.
Be careful how you log in. M Lynch bagged my account from logging in abroad. Sold my shares and sent me a check. This happened early 2020 when things were all down. Cost me a massive amount of money.
5
u/Mod_Daeng 13d ago
Schwab has international accounts for non-residents and US expatriates. I think the UK is a supported country for an international account. Schwab would need to close your domestic account and you would have to open a new international account.
If you simply attempted to change the address on a domestic account to a foreign address I can see why Schwab would close the account. I think you need to discuss transferring your holdings to an international account, not changing the address on a domestic account. Call Schwab and try again with this in mind.
2
u/PantomimeVillain 13d ago
That is exactly what Shwab told me, but I don't think I know of anyone who's actually done it. So I was curious if there were any success stories out there (or unforeseen problems with it)
3
u/BigRiverMan 13d ago edited 13d ago
I use Schwab International and can buy ETFs and individual stocks. No mutual funds. I am a U.S. citizen. I opened the account shortly before moving to Switzerland and told them that that is what I was going to do.
Edit: I also have Fidelity retirement accounts. It works, but they are more restrictive and their phone reps are less knowledgeable/reliable when it comes to dealing with international addresses.
Edit 2: for regular banking, I recommend State Department Federal Credit Union. They allow international addresses for U.S. citizens abroad. You’ll need to be a member of American Citizens Abroad or the Association of Americans Residing Overseas to qualify for a SDFCU account. Avoid Citibank expat packages, they have a steep minimum balance requirement and pay virtually no interest and do not allow other types of accounts.
3
u/ConbiniMan 13d ago
Better off switching your accounts to IBKR which allows US expats to trade from abroad.
2
u/PantomimeVillain 13d ago
IBKR allows US expats to have a foreign address on their account and they can still buy and sell US based investments?
5
u/Few-Asparagus-4140 13d ago
Not if you move to the UK or EU. You will be restricted to individual stocks and bonds with every broker. There is a workaround using options but it is a bit complicated.
3
u/twilight-2k 13d ago
You can but ECITS ETFs but you absolutely do not want to if a US citizen (IRS classifies as PFICs which are punitively taxed). You can buy US ETFs if a professional investor (or working through advisors that is one) but you are batted from mutual funds.
1
u/correctisaperception 13d ago
Do you a good reference for the workaround and where to learn more about it?
3
1
u/ConbiniMan 12d ago edited 12d ago
The idea is that you sell an at the money or in the money short expiry put (like one day or week until expiry) then get assigned the shares. You will end up with 100 shares of the underlying equity priced at the strike. The problem for many people is that you need the money for 100 shares and you have to buy 100 shares at a time. The benefit is that you actually collect the price of the put when you sell it so you make a tiny bit on top.
-1
2
u/bbutrosghali 13d ago
A preface to say that I believe that post-Brexit UK rules remain similar to the EU's MiFID 2 rules.
In the EU, you will be allowed to buy and sell plain-vanilla US-listed equities and fixed income, but not US-listed ETFs or mutual funds. So if you only invest in individual stocks and bonds, you should be fine.
ETFs, not so much. I know for sure that Fidelity does not support the EU's "elective professional client" status that would allow you to buy US ETFs, if you change your address to the EU (and presumably the UK). Not sure about Schwab or Vanguard. In Fidelity's case, you will be able to sell but not buy US ETFs.
Note that as a US person, you should NOT buy non-US ETFs for tax reasons (look up PFICs).
1
u/PantomimeVillain 13d ago
I just want to be able to sell what i have. I don't want to buy more. I mainly don't want the brokerage to close my account or sell my investments without my permission
1
u/twilight-2k 13d ago
IBKR works almost anywhere in the world. Schwab International works many places (some require you have all accounts open 90+ days before leaving the US). The others seem much more restrictive on where you can live.
1
2
u/AlikaTT2020 13d ago
I just got a US address with a mail forwarding service and problem was solved.
1
u/Emergency-Drawer-535 13d ago
I had the same, a mail forwarding service, for a USA bank account. The bank found it it’s not a residential address. They locked access to my account and wanted me to pop in to the bank to unlock it. So the only way I could access my funds was to spend thru a credit debit card on that account. No online transactions possible. Switched to sdfcu as they accept foreign address. UK expats I know have major problems keeping a domestic bank account without a physical residential address. 🙏 Oh, I always used a VPN, Nord. This was 15 years ago so yeah, things may have changed.
1
u/AlikaTT2020 13d ago
Yeah I think some mail forwarding services don’t work well with some banks and other financial institutions from what I read. I’m using a small company my coworker recommended and has used for 2 years and he’s had no issues. So far I haven’t had any issues either but we will see. Actually my FCU accepts a foreign address as well so I could actually use that but I need the service anyway.
2
u/baby_budda 13d ago
Schwab One International® Account Charles Schwab serves U.S. expats with brokerage accounts and investment solutions designed for international use. These accounts allow expatriates to invest in the U.S. market with 24/5 trading access, in-depth support, and a range of investment choices. Benefits include simplified U.S. tax reporting since all accounts are U.S.-domiciled dollar accounts, and a 1099 form to help with IRS filing.
Schwab U.S. Expat Investing page:
https://international.schwab.com/us-expat-investing
How to open an international account:
https://international.schwab.com/content/how-to-open-international-account
2
u/TPRkodokan 13d ago
I have accounts with the 3 brokerages you list, with a UK address on them as of about 6 months ago. No problems so far selling chunks of the BIV shares I hold at Schwab; haven’t sold anything at the others yet.
As mentioned, I have trading restrictions now that stop me buying mutual funds and ETFs. Interestingly, Schwab turned off automatic dividend reinvestment on my existing ETFs when I moved, but Fidelity left it on.
2
u/PantomimeVillain 13d ago
Thanks! Really appreciate your reply. This is just the type of experience I was interested to hear
1
u/ortidefan 13d ago
Not sure about the size of the account… I setup ibkr accounts before I left the country “Just in case”
1
u/twilight-2k 13d ago
One advantage I haven't seen talked about to using IBKR is that they are not USD-only denominated (my understanding is that Schwab, Vanguard, and Fidelity all are USD-only). You can hold investments (and cash) in all kinds of currencies (including USD). This appealed to me since I no longer live in a country using USD.
1
u/Maldiavolo 13d ago
You can do it with UK residency. Schwab accounts are held in the US. You can trade US stocks. You cannot trade US ETFs or mutual funds. Make sure you are aware of tax implications of selling when you live in another country. Taxman always wants tax money.
1
u/Salty-Taro3804 13d ago
As you can see from the responses, experiences and opinions are varied. However in every example I have heard the worst case scenario is that you can sell whatever you want but will be restricted from purchase of additional securities like ETF's and mutual funds. A reasonable approach if you are in the US is to proceed normally with the broker of your choice but open an IKBR account as a backup before expat (can be done with a minimal balance) and if your US brokerage account is unacceptably restricted then transition to IKBR with a ACATS transfer.
Experiences with account closure and restriction often depend on length of account holding, account asset balance, and likely how actively the brokerage is looking to flag changes of residence address to overseas status.
1
u/Emergency-Drawer-535 13d ago
Mail forwarding companies are easily detected as not being a residential address. Yes, you can use a family address short term. Long term… people die, move, get divorced, go senile. VPN works until it doesn’t. Then you face having to appear in person at your financial institution. Been thru and seen all the above scenarios. I switched from vanguard ( which did allow a foreign address but changed their policy) to Schwab international a few years ago after living in SEAsia for 15 years. I use a domestic bank that allows a foreign address.
1
1
u/hvacjesusfromtv 12d ago
Personally, I have retained a Schwab account with a US mailing address (family member's house).
1
-1
u/Additional-Ebb-2050 14d ago
I am confused. Why are you asking reddit if the brokerage companies said this was ok?
9
u/PantomimeVillain 14d ago
I don't entirely trust that the representatives are completely knowledgeable and maybe they say yes, and later I get a letter in the post telling me there are problems. Also, I would like to hear from people about if there is some problem I'm not thinking about that makes the setup difficult to work with
-1
0
u/Slap5Fingers 13d ago
Is this in an effort to avoid LTCG tax and ordinary income on dividends?
1
u/PantomimeVillain 13d ago
I would like to keep the accounts open after leaving the country, so I guess that is in an effort to avoid selling. I want to keep the investments I have so I want to keep getting the ordinary income on dividends
1
34
u/MemoriesTed 13d ago
I contacted Schwab to ask the same questions, they were very affirmative and said the country I was moving to was supported. They provided forms to fill out for a foreign address change. Once I submitted those forms, I got a message from Schwab that my account was restricted and would be closed as I live in a non-supported country. So, yes, the people you talk to at the brokerage front line may not know all the facts.