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Old 09-29-2009, 01:41 PM   #21
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For the regular US citizen investor overseas investments are a minefield.

1) You must pay the IRS tax on any gains as US citizens are taxed on their worldwide income.

2) If you have $10k or more overseas you have to declare it to the Treasury. There are very stiff penalties if you don't do this.

3) More to the point of your actual question, Passive Foreign Investment Company, PFIC, (ie foreign mutual funds) are taxed at very high rates, basically to discourage US citizens from using offshore funds. See the link below

http://www.offshorepress.com/offshoretax/otpfic.htm

Unless you are very sophisticated (ie understand about foreign trusts, PFICs etc) or have enough money to pay those that are sophisticated, stay away from this
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Old 09-29-2009, 06:24 PM   #22
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You won't find any low cost investing with the Swiss. At least, not as low as Vanguard.
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Old 09-30-2009, 09:47 PM   #23
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Thanks to everyone for the feedback. It is pretty clear that this is not fpor me at this point in life.
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Old 10-03-2009, 01:46 PM   #24
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Culture, just as a side issue, how about this? You mentioned burying gold in your back yard a few posts ago. I agree that wouldn't be a very good idea, and I also agree that this isn't the time to buy. But if what you are looking for is a low(ish) cost way of having a money stash the gov't doesn't know about and can't sieze, how about buying gold (at a future decent price) and putting it into a foreign (Swiss, Caymans, Brazilian, etc) safe deposit box? I don't know any details about cost, but I suspect it would be reasonable. And if you went with a fairly reputable overseas bank it should be pretty safe too. Obviously it wouldn't grow except at normal gold rates, but if the US gov't goes to hell and you need to grab your money and run, I suspect it would have a pretty high value at that point.

Anybody want to shoot holes in this plan? Feel free, I'm here to learn.
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Old 10-03-2009, 01:57 PM   #25
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Originally Posted by harley View Post
Culture, just as a side issue, how about this? You mentioned burying gold in your back yard a few posts ago. I agree that wouldn't be a very good idea, and I also agree that this isn't the time to buy. But if what you are looking for is a low(ish) cost way of having a money stash the gov't doesn't know about and can't sieze, how about buying gold (at a future decent price) and putting it into a foreign (Swiss, Caymans, Brazilian, etc) safe deposit box? I don't know any details about cost, but I suspect it would be reasonable. And if you went with a fairly reputable overseas bank it should be pretty safe too. Obviously it wouldn't grow except at normal gold rates, but if the US gov't goes to hell and you need to grab your money and run, I suspect it would have a pretty high value at that point.

Anybody want to shoot holes in this plan? Feel free, I'm here to learn.
AKA, the "last plane out" account. I would imagine this would be the easiest way, but you generally have to declare any cash or valuables (gold) that you move between borders, so preumably more than one gummint will no that you moved either a wad of folding money or a hunk of gold to a particular place. I suppose you could be a gold smuggler and not report it, or bring a small enough amount of currency that would not meet the reporting threshold (making multiple trips perhaps), but these seem alternately like asking for legal trouble and a PITA.
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Old 10-03-2009, 04:32 PM   #26
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AKA, the "last plane out" account. I would imagine this would be the easiest way, but you generally have to declare any cash or valuables (gold) that you move between borders, so preumably more than one gummint will no that you moved either a wad of folding money or a hunk of gold to a particular place. I suppose you could be a gold smuggler and not report it, or bring a small enough amount of currency that would not meet the reporting threshold (making multiple trips perhaps), but these seem alternately like asking for legal trouble and a PITA.
I know some Argentinians who left the country during the hyperinflationary crisis in that country about 5 years ago. I think they had to liquidate all their savings and trust an intermediary with the cash until they met up in another country. It all sounds very shady. They made it and are doing very well in their new country, but they miss home. Another strategy commonly used in Argentina was to buy gold in the form of rings which could be easily sold for cash, thereby providing a relatively liquid form of gold investment. However, if you buy gold jewellery, the markup is significant.
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Old 10-03-2009, 05:01 PM   #27
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Obviously it wouldn't grow except at normal gold rates, but if the US gov't goes to hell and you need to grab your money and run, I suspect it would have a pretty high value at that point.
If things ever got to that point (most of your other assets significantly devalued, only the gold left) I'd imagine you'd want to conserve every remaining dime. An international plane ticket at that point (so you could go fetch your gold) might seem like a pretty big expense. Plus, you've highlighted yourself (by the travel) and exposed yourself to interrogation/interview/physical search at multiple borders. And, the bank policy/relationship with the US could change at any time (as things recently have in Switzerland), foiling the ability to access your items without notice to US authorities. The alternative (get a shovel, dig it up from a known spot not far from home) seems a lot easier and more likely to succeed.
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Old 10-03-2009, 05:19 PM   #28
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I was assuming you'd be wanting to get out, not get your cash and get back home. Taking the last plane out (thanks Brewer, couldn't think of it), and having a bunch of gold in a safe deposit box seems like a much better option than digging some up and trying to make it past the border. Of course, you could do both, like a good Boy Scout.
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