Simple Global Market Portfolio with iDeCo?
Posted: Sat Jul 17, 2021 8:06 am
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_
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_
) 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?
