Offshore vs Onshore Investment

[ChrisFukuoka]

I am fine with that.

One company was called Argentum Wealth, based out of Tokyo, and recommended a plan called Evolution with Investors Trust in Puerto Rico.

The other company I never made it to the second meeting as I picked up the advice on here to run with my money while I still had it. Since I don't have enough info on what they were going to propose I won't mention the company name as it might paint them with the same brush unfairly.

[ChrisFukuoka]

Previous workshops have been 20-80 or so, but somewhere that could seat 30-40 would be great

There are so many venues in and around Fukuoka. My Japanese isn't so good to navigate all the websites and get you the exact info. I am also not based in Fukuoka City itself, but if you would like me to try to help find something please send me a message with more details of what exactly you are looking for and possible dates. I think within walking distance of Hakata station is going to be the most accessible place for most people to get there.

[RetireJapan]

Hi Chris

Thanks for the kind offer!

Basically we are looking for a venue for March 22nd, in Fukuoka and probably reasonably central, that can seat 30+ people, doesn't cost a fortune, and will let us charge money for the session. We probably need 3 hours in the morning or over lunchtime/early afternoon -so ideally something like 10-13 or so.

For some reason this is proving somewhat difficult

[StockBeard]

One company was called Argentum Wealth, based out of Tokyo, and recommended a plan called Evolution with Investors Trust in Puerto Rico.

My opinion: you dodged a bullet. This plan is an investment-linked insurance scheme. These mix investments benefits with a life insurance, and typically perform poorly* on both fronts, in particular due to the excessive and opaque fees.

The following site, which is typically very, very mild in their criticism of any product, says the following:
https://www.aesinternational.com/review ... lan-review

The pros

Superficially highly attractive
Potential for better than bank rate return if all contributions are made throughout the term
Lack of flexibility may encourage discipline of saving

The cons

Opaque and complex charging structure
Expensive way to invest
Easily mis-represented at the point of sale

If you look at the "pros" in that list, you will see that they are all actually negative points, that the reviewer is trying hard to showcase in a positive light. As far as the "cons" are concerned, having been "stuck" in a similar investment scheme myself several years ago (similar product sold to me in Japan, different company), I can only confirm that those are accurate, and an understatement of what happened to me.

* Please understand that I'm trying to stay polite here. As far as I'm concerned, these products are such a rip-off that they should be illegal and the people selling them should go to jail. This is only my opinion.

[ChrisFukuoka]

I agree with you on the bullet dodging.

When the guy took me through the scheme he was showing me performance numbers based on 9% growth which were just about keeping the plan ahead of the fees incurred. I seem to recall he said something about 2 years of deferred units which I imagine is representative of my cash being diverted into his pockets for the first couple of years instead of being invested.

I didn't really understand the description he gave and, as the review says, I believe there were many hidden fees. My father told me it was lunacy to invest in something I didn't fully understand which is what prompted me to be more proactive in gaining some knowledge (hence discovering this site).

The worst thing about it is that I actually felt bad about telling the guy to go jump after he had spent his time presenting it to me.

Hopefully this thread and the info on the RetireJapan main site might save one or two people from falling into the trap.

[concerned]

No need to feel guilty about telling that guy you are not interested.I felt the sane until I came across the below article whose main character was my friendly advisor
https://www.andrew-drummond.com/2014/09 ... tch-up-of/

[N00bster]

The worst thing about it is that I actually felt bad about telling the guy to go jump after he had spent his time presenting it to me.

Please don't feel bad about it. The guy tried to rip you off. Maybe if he wastes enough of his time on enough people he will look for a more honest way to earn a living. If anything, you're doing him a favor by encouraging his rehabilitation.

[LukeTek]

Hello guys,

I am also starting to expand my understanding about investment possibilities here in Tokyo and during the past few days I have been in contact with 2 financial advisors. Could you elaborate on why in your opinion it's a bad idea to stick with them? What is the issue with offshore insurance wrappers?

Thank you!
Luca

[RetireJapan]

Mostly this: https://www.retirejapan.com/blog/financial-advisors/

The TL:DR is that these firms make money by signing you up for complicated products that pay large commissions (like, over a million yen) with hidden fees and unfavourable redemption penalties. They ignore the more sensible options available in Japan because those don't pay commissions and try to confuse you by babbling on about 'offshore' opportunities.

Feel free to post the specific product they are encouraging you to buy, and we'll be happy to take it to pieces

[captainspoke]

... What is the issue with offshore insurance wrappers?

Thank you!
Luca

The issue is that they suck. The fees are easily the highest around--a fund/unit trust may be "free" to buy or sell, but the policy itself will never be, and that's where you get hurt the most. (Like, you get free food in prison, too.) The redemption fees are onerous, and if you google around, any number of people have been hurt that way.

The advisors are sales agents, selling products that make them money, not fiduciaries. The products they sell, being "offshore", are unregulated--no SEC or the like to police things. If something goes kaput, you have absolutely no recourse.

If you're attracted to them as a 'portable' savings plan, know that in many countries, when you start bringing that money back to yourself (wanna buy a house/land?), you'll either have to do it surreptitiously, with fingers crossed, or the local tax authorities will be asking you questions.

And if you're US, just don't. US persons have to file/report taxes until they die, wherever they may live. So you're faced with the choice of hiding that account (not reporting it), which is tax fraud, or trying to report it faithfully. And in that case, what you'd be 'investing' in will most certainly be a PFIC, and that's one of the biggest tax nightmares ever.