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Creative Planning
Last Updated
January 01, 2022

Problem: Brokers and advisors outside the United States do not understand how U.S. taxation works, and most brokers and advisors in the U.S. do not under- stand the special issues of Americans abroad.

How can I choose a proper advisor?

Recommendation: Seek out the advice of a “fee-only” Registered Investment Advisor with experience working with expats.

Fee-only advisors are compensated only by their clients. By not taking commissions or maintaining fee splitting agreements with fund companies and brokerages, the potential for conflict of interest between the client and advisor is reduced.

Why Registered Investment Advisors (RIAs)?

RIAs are legally bound to act as fiduciaries to their clients. That is, they have a legal obligation to put the clients’ interests ahead of their own. Brokers are not RIAs and do not have a fiduciary obligation to their clients.

What to avoid?

Avoid relying on investment ad- vice from advisors such as stockbrokers or insurance agents, who are compensated by selling products through commissions and fee sharing agreements with the issuers. In these situations, the advisor is likely to recommend investments based on the size of their potential compensation rather than the quality of the investment and strategy. Additionally, investors should be especially careful when considering investments registered in “off-shore” locations. There is a high incidence of fraud among these operations. Even legitimate investment schemes in these regions typically lack investor safeguards that exist in the U.S. Finally, understand the tax rules regarding investments outside the United States.

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This commentary is provided for general information purposes only and should not be construed as investment, tax or legal advice, and does not constitute an attorney/client relationship. Past performance of any market results is no assurance of future performance. The information contained herein has been obtained from sources deemed reliable but is not guaranteed.

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“Your wealth works harder when it works together.”

Peter Mallouk

President & CEO, Creative Planning

Serving Clients Nationwide

50

STATES & ABROAD

Providing financial peace of mind across the globe

$225

BILLION

Combined assets under management & advisement as of December 31, 2021

#1 Ranking

RIA Channel®’s List of Top 100 Wealth Managers (2020)*

$225 Billion

Combined assets under management & advisement as of December 31, 2021

Serving Americans abroad and cross-border families in over 50 countries.