Simple Global Market Portfolio with iDeCo?

[_To_]

Hi,

first time posting here. Looking forward to learn from the accumulated expertise on the forum.

I am German, 35 years old, owner of a small business (個人事業) that just started to be profitable, married to a Japanese and just had a Baby.
We are planning to always keep a presence in Japan (although I might send the kids to school in Germany).
Neither me nor my wife are particularly knowledgeable about the intricacies of the Japanese bank/brokerage/pension/insurance/tax systems and with a company to run and a newborn to care for, somewhat lack the time and psychological resilience to further get into the nitty gritty of that bone dry subject matter.
Any advice will therefore be greatly appreciated.

The situation so far:
We have recently set up an SBI account for my wife in order to invest her savings instead of letting them rot away on a savings account. My own savings went into the company.
My initial plan was to follow the wisdom of investing into broadly diversified ETFs (something very simple like an MSCI All Countries World (maybe with addition of an MSCI World Small Caps)) via buy and hold strategy.
In Germany, I would have chosen an Ireland domiciled, accumulating ETF, to avoid having to pay taxes on capital gains from dividends and profit from the automatically reinvested amounts over the long-term.
Since I cannot buy these ETFs with SBI, I looked at Vanguard and BlackRock ETFs listed on NYSE instead, just to learn that accumulating ETFs do not exist in the US. Then, inevitably, fell down the rabbit hole on whether dividends paid by distributing ETFs will be taxed in Japan or not.
Took a long break after that.
Then I learned about iDeCo.
And that seems to be the way to go as we are both eligible and do not plan to ever leave Japan for good. My current plan is to open an account with SBI as well and set up iDeCos for both of us.
If I am not mistaken, we both belong to Kokumin Nenkin Category 1, so could each invest up to 68,000 yen monthly in iDeCo. I currently cannot max that out, but I plan to die trying.
From what I have read so far, it seems that ETFs are not available in iDeCo but there seem to be mutual funds that mimic them? Also, looks like that field is developing pretty fast right now, with new ones popping up regularly? This is where I lack information.

So, what would the forum’s advice be on how to proceed from here?
1. How would I best emulate a set-and-forget portfolio containing an accumulating All Countries World ETF in an iDeCo setting?
2. Is there any vastly better and totally different approach? Any major faults or oversights in my reasoning so far? Is SBI the right choice here?
(Not so much looking for advice pertaining other financial products, like bonds, metals, crypto currency etc. Mostly focused on how to mimic something like the aforementioned ETF portfolio inside an iDeCo account.)

With best regards
よろしくお願いいたします。
_To_

[zeroshiki]

Mutual funds are the go-to answer around here for iDECO or NISA because of its tax advantage and low cost. There is a concept in Japan (I assume this exists everywhere else though) called Tsumitate where you can setup your account to automatically pull from your bank (or charge your CC) a set amount each month and use it to buy an MF of your choice. I think this might be what you're looking for.

SBI has the SBI All world "yuki daruma" fund so you can't go wrong with that. Its kinda still new so we're not sure about its performance but since you're already in SBI I'd just use that if I were you. The favorite fund in this forum is the emaxis slim all world fund which has a better track record than SBI (while being *slightly* more expensive) but as far as I know you can only get emaxis slim all world on Monex for iDECO.

[Kanto]

Hi,

first time posting here. Looking forward to learn from the accumulated expertise on the forum.

I am German, 35 years old, owner of a small business (個人事業) that just started to be profitable, married to a Japanese and just had a Baby.
We are planning to always keep a presence in Japan (although I might send the kids to school in Germany).
Neither me nor my wife are particularly knowledgeable about the intricacies of the Japanese bank/brokerage/pension/insurance/tax systems and with a company to run and a newborn to care for, somewhat lack the time and psychological resilience to further get into the nitty gritty of that bone dry subject matter.
Any advice will therefore be greatly appreciated.

The situation so far:
We have recently set up an SBI account for my wife in order to invest her savings instead of letting them rot away on a savings account. My own savings went into the company.
My initial plan was to follow the wisdom of investing into broadly diversified ETFs (something very simple like an MSCI All Countries World (maybe with addition of an MSCI World Small Caps)) via buy and hold strategy.
In Germany, I would have chosen an Ireland domiciled, accumulating ETF, to avoid having to pay taxes on capital gains from dividends and profit from the automatically reinvested amounts over the long-term.
Since I cannot buy these ETFs with SBI, I looked at Vanguard and BlackRock ETFs listed on NYSE instead, just to learn that accumulating ETFs do not exist in the US. Then, inevitably, fell down the rabbit hole on whether dividends paid by distributing ETFs will be taxed in Japan or not.
Took a long break after that.
Then I learned about iDeCo.
And that seems to be the way to go as we are both eligible and do not plan to ever leave Japan for good. My current plan is to open an account with SBI as well and set up iDeCos for both of us.
If I am not mistaken, we both belong to Kokumin Nenkin Category 1, so could each invest up to 68,000 yen monthly in iDeCo. I currently cannot max that out, but I plan to die trying.
From what I have read so far, it seems that ETFs are not available in iDeCo but there seem to be mutual funds that mimic them? Also, looks like that field is developing pretty fast right now, with new ones popping up regularly? This is where I lack information.

So, what would the forum’s advice be on how to proceed from here?
1. How would I best emulate a set-and-forget portfolio containing an accumulating All Countries World ETF in an iDeCo setting?
2. Is there any vastly better and totally different approach? Any major faults or oversights in my reasoning so far? Is SBI the right choice here?
(Not so much looking for advice pertaining other financial products, like bonds, metals, crypto currency etc. Mostly focused on how to mimic something like the aforementioned ETF portfolio inside an iDeCo account.)

With best regards
よろしくお願いいたします。
_To_

Yes, absolutely.

In Japan Mutual Funds > ETFs. Why?

1. Mutual funds accumulate dividends and are tax-advantageous.
2. They have rock bottom fees
3. You can buy them in Yen amounts, and not in shares.

......

All World, Yes lots of Options. Here are the best of both the main indexes.

FTSE ALL CAPS -> https://www.rakuten-sec.co.jp/web/fund/ ... 90C000FHC4
MSCI ACWI -> https://www.rakuten-sec.co.jp/web/fund/ ... 90C000H1T1


......

Tsumitate NISA -> Monthly - Set and forget
iDeco -> Monthly - Set and forget.
Tsumiate (regular) -> Monthly - Set and forget (credit card or bank account).

Credit card payments usually have a 5man limit, but you can just setup 2-3 different securities account (Monex, SBI, Rakuten).

[adamu]

https://retirewiki.jp/wiki/Japanese_global_index_funds

[_To_]

Thanks for your replies!

Seems like I was at least shambling in the right direction.

That Wiki is a wonderful idea!
Great way to make the most crucial and basic information available in a structured manner without having to scour pages upon pages of threads in the forum which only ever partially apply to one's own situation.

I've been browsing the Wiki and a few other threads as well to get a bit more info on the suggested funds.
So, it seems my best options are:

1) Stay with SBI and bet on the rather recent Yuki Daruma ＳＢＩ・全世界株式インデックス・ファンド that suffers from the often mentioned and apparently feared "triple taxation problem" (I have no clue what that means).
2) Abandon SBI and open iDeCo with Monex to gain access to the coveted eMaxis Slim All Country ｅＭＡＸＩＳ Ｓｌｉｍ 全世界株式（オール・カントリー） that seems to be the gold standard around here.

My wife will probably not be thrilled as she is the one that will be stuck with doing the applications, but I am actually tending towards option 2.
When picking ETFs in Germany, I have been taught to always go for the well established, faithfully physically tracking ones with high volume and avoid freshly set up ones or ones that just emulate and extrapolate.
My main focus is on keeping the fees to a minimum and I do not plan to touch the account before turning 65.

Follow up question:
Is it worth the trouble (I have a middle name ) of opening two Monex accounts and then applying for two Monex iDeCo accounts to gain access to the tried and true eMaxis Slim All Country that has stood the test of time and avoid the "triple taxation problem" and the relative newcomer Yuki Daruma?

I am aware that "trouble" (especially if I make my wife go through it) is highly subjective. So, subjective answers are welcome
If I remember correctly, I have seen a comment from adamu, mentioning that they would probably do the above if they had to do it again, instead of sticking with SBI. I forgot to copy the link to the thread.
Any other opinions?

(Stupid bonus question: A general Monex account IS needed to apply for a Monex iDeCo, right? It's not possible to just get the latter?)

[zeroshiki]

Thanks for your replies!

Seems like I was at least shambling in the right direction.

That Wiki is a wonderful idea!
Great way to make the most crucial and basic information available in a structured manner without having to scour pages upon pages of threads in the forum which only ever partially apply to one's own situation.

I've been browsing the Wiki and a few other threads as well to get a bit more info on the suggested funds.
So, it seems my best options are:

1) Stay with SBI and bet on the rather recent Yuki Daruma ＳＢＩ・全世界株式インデックス・ファンド that suffers from the often mentioned and apparently feared "triple taxation problem" (I have no clue what that means).
2) Abandon SBI and open iDeCo with Monex to gain access to the coveted eMaxis Slim All Country ｅＭＡＸＩＳ Ｓｌｉｍ 全世界株式（オール・カントリー） that seems to be the gold standard around here.

My wife will probably not be thrilled as she is the one that will be stuck with doing the applications, but I am actually tending towards option 2.
When picking ETFs in Germany, I have been taught to always go for the well established, faithfully physically tracking ones with high volume and avoid freshly set up ones or ones that just emulate and extrapolate.
My main focus is on keeping the fees to a minimum and I do not plan to touch the account before turning 65.

Follow up question:
Is it worth the trouble (I have a middle name ) of opening two Monex accounts and then applying for two Monex iDeCo accounts to gain access to the tried and true eMaxis Slim All Country that has stood the test of time and avoid the "triple taxation problem" and the relative newcomer Yuki Daruma?

I am aware that "trouble" (especially if I make my wife go through it) is highly subjective. So, subjective answers are welcome
If I remember correctly, I have seen a comment from adamu, mentioning that they would probably do the above if they had to do it again, instead of sticking with SBI. I forgot to copy the link to the thread.
Any other opinions?

(Stupid bonus question: A general Monex account IS needed to apply for a Monex iDeCo, right? It's not possible to just get the latter?)

I don't have an iDECO so I can't answer the question fully but if you're going to go to the trouble of choosing a securities broker for the product available in it (in this case Monex for EMaxis Slim All Country) the best time is to do it at the start (so now) but do note that it takes months to setup especially if you're foreign (Monex and then Monex iDECO are different applications).

If you already had iDECO with SBI I would advise strongly against moving to Monex just for EMaxis Slim but since you haven't started yet I say go for it (and buy your wife some flowers or something).

I also suggest getting a Monex card while you're at it. Monex will soon be offering a tsumitate product using the Monex card that earns points. (Alternatively/in addition you could get a SMBC card and tsumitate for SBI. We know it earns points now)

[Kanto]

Did you have an issue applying for the MONEX card?

I have Amazon Gold and Rakuten, but Monex rejected me automatically...

[zeroshiki]

Did you have an issue applying for the MONEX card?

I have Amazon Gold and Rakuten, but Monex rejected me automatically...

I haven't applied for it because I wanted to wait until I get my Monex account. I can't imagine they're particularly strict. Its odd that they'd reject you especially if you have other cards already. I assume you never miss payments?

[Kanto]

Did you have an issue applying for the MONEX card?

I have Amazon Gold and Rakuten, but Monex rejected me automatically...

I haven't applied for it because I wanted to wait until I get my Monex account. I can't imagine they're particularly strict. Its odd that they'd reject you especially if you have other cards already. I assume you never miss payments?

Never missed a payment. It seemed like an auto-generated rejection.

[_To_]

Hi!

It's been some time...life has been happening (we had a baby, we opened a shop in a suburb of Yokohama, hired and trained part-time workers, currently in the process of revamping the online business entirely) BUT now we finally set up Monex accounts for both of us and are ready to fill them with what is left over after a comprehensive round of investing money in our own business.

Just because I have entirely missed any and all possible new developments since 2021 (and do not have the time to read through 2 years of forum posts), I just wanted somebody to confirm that allocating 100% of the iDeCo funds into eMaxis Slim All Country is still the simple but effective hands-off approach of choice.

Judging from this:
https://www.fundoftheyear.jp/2022/
it seems as if that was the case until last year at least

Essentially just waiting on a thumbs up from one of you experts here and then I'll dash outside and throw the already filled out application forms into a post box