Author Topic: Non resident alien living in US wants to invest. Advice?  (Read 1243 times)

eazyebeneezer

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Non resident alien living in US wants to invest. Advice?
« on: April 07, 2018, 05:36:13 AM »
My wife is a foreign national who works for a foreign government and has a diplomat visa. Though she's been in the US for ten years, she's considered a non resident alien. She saves a LOT of money at her job. Aside from a healthy 401k, she keeps everything in cash. I've been trying to convince her to set up a ROTH IRA and a taxable account to get some of that money working for her, and for our FI future. Finally she is seeing the logic in this and we logged onto Vanguard together the other day to setup an account. She was unable to open an account there due to being a non resident alien.

Have others been in this situation? Are there companies that do allow non resident aliens to invest? I read a few articles saying that it was technically possible, but wondering if my fellow Mustachians have experience with this and/or recommendations.

Financial.Velociraptor

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Re: Non resident alien living in US wants to invest. Advice?
« Reply #1 on: April 07, 2018, 08:03:10 AM »
Try Interactive Brokers.   They probably have a presence in her home country that she could open and then fund with USD to trade US markets.  They are very international...

eazyebeneezer

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Re: Non resident alien living in US wants to invest. Advice?
« Reply #2 on: April 07, 2018, 12:57:11 PM »
Thanks for the lead, Velociraptor. It's not the easiest site for a newbie investor to figure out, but I'll do some digging into it. She was hoping to get a Vanguard Lifestyle fund, just set a risk tolerance and let it go. This site looks to be more for experienced investors balancing their own portfolios. I'll see what I can find out.

Paul der Krake

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Re: Non resident alien living in US wants to invest. Advice?
« Reply #3 on: April 07, 2018, 02:24:33 PM »
Vanguard is silly when it comes to foreign nationals. You can just say she's a resident alien (which she almost certainly is for tax purposes, just not immigration purposes), and open it anyway.

Or just go to any other broker like Fidelity or Schwab, they'll be happy to have her.

aspiringnomad

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Re: Non resident alien living in US wants to invest. Advice?
« Reply #4 on: April 08, 2018, 11:05:44 AM »
I'm in this exact situation. I set my wife up with Schwab and highly recommend it. In my experience, Vanguard's customer service is generally not very good, but especially poor for non US citizens.

gerardc

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Re: Non resident alien living in US wants to invest. Advice?
« Reply #5 on: April 08, 2018, 12:05:49 PM »
Vanguard is silly when it comes to foreign nationals. You can just say she's a resident alien (which she almost certainly is for tax purposes, just not immigration purposes), and open it anyway.

Not necessarily, I'm not sure about the rules for foreign diplomats, but the point is that if she files a 1040 for her taxes, she can consider herself as a resident at Vanguard wherever her address is located (she'd then need to get a US address and use it to register and mark herself as resident to bypass their stupid site), but if she files a 1040NR for non-resident aliens, she'd need to file an IRS W-8 form with the broker (I think Vanguard won't open a new account but would support existing ones with new investment restrictions, seems like Fidelity just needs a W-8). The point of all this is to get proper tax withholding on distributions and dividends for non residents, so she needs to select the correct option depending on her tax filing status for the year.

eazyebeneezer

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Re: Non resident alien living in US wants to invest. Advice?
« Reply #6 on: April 08, 2018, 01:01:52 PM »
Thank you all for the replies. We will check with Fidelity, where I already have accounts and have been happy with the service. Foreign diplomats are considered non resident aliens for tax purposes, meaning she doesn't pay US taxes at the moment. She will be getting a green card in the near future, at which point she'll begin paying taxes because she'll be a resident alien. I just want to help her get a jumpstart on the investing process.

WalkaboutStache

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Re: Non resident alien living in US wants to invest. Advice?
« Reply #7 on: May 10, 2018, 01:59:02 AM »
Thank you all for the replies. We will check with Fidelity, where I already have accounts and have been happy with the service. Foreign diplomats are considered non resident aliens for tax purposes, meaning she doesn't pay US taxes at the moment. She will be getting a green card in the near future, at which point she'll begin paying taxes because she'll be a resident alien. I just want to help her get a jumpstart on the investing process.

Did Fidelity work?  I am in a similar situation (I have a US-based rental stream) so it would be good to know.

eazyebeneezer

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Re: Non resident alien living in US wants to invest. Advice?
« Reply #8 on: June 17, 2018, 07:29:48 AM »
I've been slow to respond to this because my wife has decided to wait until we get her green card processed to start any other investment accounts. So no updates at the moment.