Millionaire Expat

How To Build Wealth Living Overseas

Andrew Hallam

• Publisher: Wiley
• Year: 2022
• Print ISBN: 9781119840107
• eBook ISBN: 9781119840145
• Edition: 3
• Topic: Business
• Subtopic: Finance
• Index: Business

Build your strongest-ever portfolio from anywhere in the world

Now in its third edition, Millionaire Expat is the world's most trusted, bestselling guide for expat investors. It shows readers how to protect themselves from financial sharks and build effective portfolios that maximize profits and tax efficiency. This updated guide includes model portfolios of ETFs or index funds. It recommends subtle differences for investors based on nationality, while explaining why all-in-one portfolio funds are even simpler and more profitable than individual ETFs. Millionaire Expat also provides investment models for socially responsible funds.

Best of all, this book is specific. Author Andrew Hallam doesn't just offer theory. He shows you exactly what to buy and where to buy it from. He explains how much you should sell each year, upon retirement, and discusses repatriation: showing how different countries deal with the taxation of portfolios that were built abroad.

And if you're looking for a hands-free approach, Millionaire Expat offers something for you as well: lists of roboadvisors and full-service financial firms that offer guidance and build portfolios of ETFs and index funds.

But what if you started investing late and can't afford to retire? In that case, Andrew Hallam has you covered. He profiles several low-cost countries that are popular with expats. He explains what countries are great for Global Nomads and for retirees looking for tax breaks, safety, solid health care systems and a low-cost, enjoyable standard of living.

Millionaire Expat (3rd edition) is an entertaining guide, showing readers how to maximize their money and their life satisfaction based on simple, smart investing and their choice of retirement destination.

Author Andrew Hallam was a high school teacher who built a million-dollar portfolio—on a teacher's salary. He knows how everyday people can achieve success in the market. In Millionaire Expat, he tailors his best advice to the unique needs of those living overseas to give you the targeted, real-world guidance you need.

Chapter 1
Grow Big Profits Without Any Effort

Once upon a time, in a land far away, there lived a young farmer. His name was Luke Skywalker. Don't get confused by his Star Wars namesake. That was just a movie.

Luke had a farming mentor, an awkward little guy with a massive green thumb. His name was Yoda. “Use the Force you must, young Skywalker,” he said. “Add new seeds to your crop fields every year. The Force will grow those seeds. They will flower and spread more seeds and those seeds will grow.”

“Which seeds should I plant?” asked Luke. “Buy the bags that contain every type of seed for every type of vegetable,” replied Yoda. “You'll never know which vegetables will grow the best in any given year,” he said. “Plant them all, you should. Let the Force look after the rest. But watch out for the dark side.”

Luke wasn't sure what Yoda meant by the dark side. He just knew that Yoda was a mysterious little dude. So Luke bought a bag that contained every seed. He planted every one, and his crops began to flourish. Some years, his carrots grew best. Other years, his lettuce, parsnips, or beets took center stage. Sometimes, droughts and a searing sun hurt his crops. But his crops always came back, stronger than ever.

This is how the stock market works. You can buy a single fund called a global stock market index fund. Like a bag of seeds representing multiple plants, it contains thousands of different stocks, representing dozens of different markets. It contains American stocks, British stocks, Canadian stocks, Australian stocks, and Chinese stocks. In fact, a global stock market index contains about 7,400 stocks from at least 49 different countries. Nobody trades those stocks. With a global stock market index, you own all of those stocks. You would also have access to that money, any time you want.

Some years (much like the garden during a drought), the proceeds recede. But just like that garden, the stock market always comes back stronger than before.

Imagine if someone had invested a lump sum of $1,200 in the global stock market, starting in 1970. They then saved an additional $3.29 per day, adding that amount to their investment at the beginning of each year. Between January 1970 and December 31, 2020, that person would have added a total of $61,200 (see Figure 1.1 and Table 1.1). If they equaled the return of the global stock market index during those 51 years, that initial $1,200 investment—plus a further commitment equal to $3.29 per day—would have grown to more than $1.8 million. Between January 1970 and January 2021, global stocks averaged a compound annual return of 10.07 percent per year.

Figure 1.1 Global Stock Market Growth

SOURCE: Morningstar Direct.

Table 1.1 Global Stock Market Growth

...

Year Ended Dec 31	Annual Return	Total Cost of Cumulative Investments	Total Value after Growth
1970	−2.25%	$1,200	$1,173
1971	18.52%	$2,400	$2,812
1972	28.21%	$3,600	$5,144
1973	−8.96%	$4,800	$5,776
1974	−21.09%	$6,000	$5,505
1975	32.44%	$7,200	$8,880
1976	8.97%	$8,400	$10,984
1977	3.32%	$9,600	$12,588
1978	24.22%	$10,800	$17,128
1979	12.33%	$12,000	$20,588
1980	21.85%	$13,200	$26,548
1981	−3.19%	$14,400	$26,863
1982	6.61%	$15,600	$29,918
1983	25.37%	$16,800	$39,013
1984	6.47%	$18,000	$42,815
1985	51.83%	$19,200	$66,827
1986	45.35%	$20,400	$98,878
1987	10.06%	$21,600	$110,146
1988	20.56%	$22,800	$134,238
1989	24.15%	$24,000	$168,147
1990	−12.00%	$25,200	$149,025
1991	18.42%	$26,400	$177,897
1992	−4.10%	$27,600	$171,754
1993	25.25%	$28,800	$216,624
1994	6.19%	$30,000	$231,308
1995	20.73%	$31,200	$280,707
1996	13.73%	$32,400	$320,612
1997	15.33%	$33,600	$371,146
1998	27.58%	$34,800	$475,039
1999	29.04%	$36,000	$614,539
2000	−13.80%	$37,200	$530,767
2001	−17.86%	$38,400	$436,958
2002	−18.75%	$39,600	$356,003
2003	38.08%	$40,800	$493,226
2004

Table of contents

• Cover
• Table of Contents
• Title Page
• Copyright
• Dedication
• Acknowledgements
• Introduction
• Chapter 1: Grow Big Profits Without Any Effort
• Chapter 2: Don't Start a Fight with an Escalator
• Chapter 3: Where Are the Customers' Yachts?
• Chapter 4: Expats Should Avoid Snakes In Suits
• Chapter 5: Self‐Appointed Gurus and Neanderthal Brains
• Chapter 6: Investment Advisors with a Conscience
• Chapter 7: Thirty‐four Questions Do‐It‐Yourself Investors Ask
• Chapter 8: Couch Potato Investing
• Chapter 9: Model Portfolios for American Expats
• Chapter 10: Portfolio Models for Canadian Expats
• Chapter 11: Portfolio Models for British Expats
• Chapter 12: Portfolio Models for Australian Expats
• Chapter 13: Portfolio Models for Europeans and Other Nationalities
• Chapter 14: Setting Your Bulls Eye
• Chapter 15: Retire A Decade Early In Latin America
• Chapter 16: Retire A Decade Early In Europe
• Chapter 17: Retire A Decade Early In Southeast Asia
• Conclusion
• Low‐Cost Retirement Country Resources
• Index
• End User License Agreement