RetireJapan

Since this is my first post on this forum, I'll add a short blurb here at the top, introducing myself to the community. This post is rather long, but please bear with me.

I immigrated to Japan in early 2011, right after the Fukushima incident. Fast forward to today, I'm 36 and married with one child. My proficiency at the Japanese language is unfortunately not that good, and I'm exceptionally bad at reading kanji (I'd be lucky to pass the N3 exam). I also lack a university degree and drivers license.
Unsurprisingly, as a result of this I don't have a very good job and neither does my wife. When we were younger the relative lack of money didn't really bother me that much, as life wasn't that rough. However, ever since our baby was born things have changed - drastically. Not only do we have an additional mouth to feed, the price of daycare and the fact that my wife has to work less coupled with a purchase of a car (my wife insisted on this) has done a number on our savings account (which is, pretty much empty now).

So that's me, and now you know where I coming from.

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I've done some basic research into Japanese investment alternatives as I realized I need to be very strategic and intentional about accumulating wealth, or I'll be working into my 70's like a lot of Japanese seems to think is normal. I'm aware of NISA and iDeCo and I'm in the progress of looking into how and where to set it up. It seems like these two options is the number one recommendation around here, but I'm afraid my lack of Japanese proficient might make it more difficult for me. But I obviously don't have 10.000$ to start an Interactive brokers account either (another option that seems to be out there).

For the time being I'm leaning towards setting up an iDeCo account for both myself and my wife first. This while also re-building out savings account, as I believe that everyone should have some cash that is easily accessible. Short term, there will be no money left to invest or put into anything else, at the very least until I've got ~500.000¥ in the bank. I still think this might be the correct way to go about it but I'm open to suggestions which is why I'm posting here.

I'm also on the lookout for a Japanese bank where I can login online and complete my transactions through an English interface - does such a bank even exist? I currently have Fukuoka Bank and Nishi Nippon City Bank. Not a big fan of either one though.

Another issue relating to banks would be credit cards. I currently have an AEON card and Rakuten Card. The Rakuten one is connected to my wife's bank account and we use those (she has one too) for purchases related to the family as a whole. Leaving me with my AEON card for anything else, including my student debt payments. The payment information in AEON's app updates very slowly though, and sometimes I can't see a transaction there until after a whole week or more(!) has passed. Not very good. AEON also charges high fees for splitting payments, so I always use the "pay once" option. I guess what I'm wondering here is if there isn't a better alternative out there for me?

Finally, as the money in my saving account grows past a certain threshold, I'm considering taking a percentage of it and buying physical gold, effectively dividing my savings into cash (for urgent use) and gold (for less urgent needs). I'm sure this is an idea that some might find reasonable and others might find horrible, as I'm aware people have strong opinions in this matter.
What I want to know though is how to acquire (and sell) gold works in Japan specifically. Is it cheaper or more expensive due to taxes, and premiums or would it cost more or less the same as if you buy in the U.S. and/or Europe? I guess what I'm wondering is if this, for whatever reason, is a worse strategy for us living in Japan compared to other parts of the world. And if it's not, any recommendations for how to go about it would be welcome. Anything like reputable dealers to what gold bullion coins is most popular (liquid) here in the Japanese market (Gold American Eagles, Canadian Maple Leaf, etc)?

Of course, any advice at all for improving my economical situation, even if it's unrelated to what I'm asking here is very welcome.

Thank you for taking your time to read through this text wall, much appreciated.

Welcome! The first question would be are you a US citizen or someone who needs to file a tax return with the IRS?

Hello, and thank you.

I forgot to mention that. I am NOT a US citizen or have anything to do with the IRS.

I heard Sony Bank has some kind of English interface but I've never used them so I can't give a strong recommendation.

What's important to understand is that credit cards are treated kind of different in Japan in that there's the expectation that its kind of a delayed debit card. You don't really pay a minimum amount and then take a hit on interest the next month. You either pay it in full, do a revo (please don't) or do split payments which as you've already alluded to has extortionate rates. So, don't buy anything with a CC that you can't pay for.

AEON Card updating late is more a function of how processors work in Japan rather than a problem with AEON. The shop you used your CC on doesn't report the charge until later so AEON doesn't find out about it and inform you until that happens.

You can buy gold through your securities broker. I have no idea if its advantageous or not but I don't see the point. Gold is purely speculative. You can buy USD or bitcoin if you're afraid of the JPY tanking or something.

One of the Bank accounts available with all English support is the Prestia Account (SMBC Trust Bank, formerly Citibank)

https://www.smbctb.co.jp/en/

You can open an account online and do just about everything online.
Unfortunately, they don't have iDECO or NISA though.

You can open a Multimoney Account and buy/sell/deposit foreign currencies, but at standard Bank Spreads (Most currencies are Y1 each way).

I think you already know the difference between iDECO and NISA, but anyway, iDECO funds will only become available to you when you reach 60/65, but NISA can enjoy the same tax benefits, but is more flexible if you needed the money earlier.

You might want to do Tsumitate NISAs for the time being, and do iDECOs later, or one iDECO for one of you and a T-NISA for the other, to give you some flexibility in the mid-term.

Are you already both paying into the National Pension? If yes, and you have more allowance available, then...

You said you have a Rakuten Credit Card. You could set up iDECO and/or NISA with Rakuten, pay by Credit Card and get cash back. Good start.
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Not recommendations - just my initial thoughts... And I'm certainly not selling anything...

The eMAXIS Slim All World (All Country) - eMAXIS Slim 全世界株式(オール･カントリー) is very popular in this community - No Purchase Fee and (I think) 0.1144% Management Fee.

You could also look at Aeon. You can speak face to face with someone at the Aeon Store Bank Branch...

AEON Bank has both iDECO and NISA (apparently operated by Mizuho on the back-end, I was told), and their list of funds is not too bad...
Unfortunately, they don't have the The eMAXIS Slim All World (All Country) - eMAXIS Slim 全世界株式(オール･カントリー) ;-(
Really, you only want to put the money in a small number of (or one) No-Load Index Funds for the absolute minimum fees possibility.
The (nearly) equivalents for the AEON iDECO or T-NISA would be:

iDECO
Japan - ONE DC Japan Domestic Equity Index Fund - ONE DC国内株式インデクスファンド - No Purchase Fee and 0.154% Management Fee.
Int'l - ONE Tawara No-Load Developed World Index Fund たわらノーロード先進国株式 - No Purchase Fee and 0.10989% Management Fee.

T-NISA
Japan - iFree Index Fund - iFree xxxインデクスファンド　- either Nikkei 225 - No Purchase Fee and 0.154% Management Fee.
or TOPIX - No Purchase Fee and 0.154% Management Fee.
or JPX Nikkei 400 - No Purchase Fee and 0.2145% Management Fee.
Int'l - iFree Global Equities - iFree 外国株式 - No Purchase Fee and 0.2475% Management Fee.


Rather than waiting until you have put together an emergency fund, I would suggest you divide the available money into 3, and get started as soon as possible. With the current state of the markets, you don't want to miss this buying opportunity to Dollar Cost Average while the prices are low, and hopefully will go down before going up... It could be the buying opportunity of the decade, especially if the Yen gets stronger for the international funds...

It will take a little while to set up.

I personally wouldn't recommend you go for gold. The price goes up or down, but there is no cash flow, so it can't leverage growth in the companies in the fund. I'm sure many people on this forum will agree that No-Load Index Fund(s) are the way to go, and you should ensure to reinvest any dividends.

You'll also get the tax rebate for the iDECO and/or NISA contributions, which you won't get if you buy gold.
You could find an iDECO and/or NISA provider that may have a Gold Fund....



My 2c

1. I strongly recommend reading this: https://www.bogleheads.org/wiki/Boglehe ... _investors

save a lot,
-select an asset allocation containing both stock and bond asset classes (or just cash in Japan at current rates).,
-buy low cost, widely diversified funds,
-allocate funds tax-efficiently,
-and stay the course.

This generally requires only a part of a day to set up, and then about an hour a year of effort to rebalance. Beyond that, there is no need to watch the markets or follow financial news. Even better, it works. Although this may seem strangely simple, it is based on decades of comprehensive research showing that buying and holding the whole market consistently outperforms many of the alternatives.

2. Plan

a. Save 3 months expenses in cash first.
b. Do you have term life insurance?
C. Look at iDeco and Tsumutate NISA (set and forget). Treat them like monthly bills.
D. Only look at Gold after all this is done.

3. QandA

English Banks - SONY is good, but I think you can struggle through with Yucho too.

Gold - Not a recommendation. Gold is used as a diversifier, or a hedge. It is not an investment per say.

The most Cost effective way is through ETFS. You could also use the Gold exchanges most major Sec. Companies have, which allow for physical delivery. Finally dealing in physical gold can be a huge hassle, as there is a lot of counterfeit bars floating around Asia over the last decade. Do you have a safe? Anyways Gold is something to look into after your have done A, B and C.

Haystack wrote: ↑Wed Mar 16, 2022 11:57 am 1. I strongly recommend reading this: https://www.bogleheads.org/wiki/Boglehe ... _investors

save a lot,
-select an asset allocation containing both stock and bond asset classes (or just cash in Japan at current rates).,
-buy low cost, widely diversified funds,
-allocate funds tax-efficiently,
-and stay the course.

This generally requires only a part of a day to set up, and then about an hour a year of effort to rebalance. Beyond that, there is no need to watch the markets or follow financial news. Even better, it works. Although this may seem strangely simple, it is based on decades of comprehensive research showing that buying and holding the whole market consistently outperforms many of the alternatives.

2. Plan

a. Save 3 months expenses in cash first.
b. Do you have term life insurance?
C. Look at iDeco and Tsumutate NISA (set and forget). Treat them like monthly bills.
D. Only look at Gold after all this is done.

3. QandA

English Banks - SONY is good, but I think you can struggle through with Yucho too.

Gold - Not a recommendation. Gold is used as a diversifier, or a hedge. It is not an investment per say.

The most Cost effective way is through ETFS. You could also use the Gold exchanges most major Sec. Companies have, which allow for physical delivery. Finally dealing in physical gold can be a huge hassle, as there is a lot of counterfeit bars floating around Asia over the last decade. Do you have a safe? Anyways Gold is something to look into after your have done A, B and C.

Agree with Haystack here.
Focus on the basics. Make sure you have several months worth of expenses in cash in the bank. And now you have a family, make sure you have some life insurance. Then the tax-advantaged accounts.

Gold should be very far down your list of priorities, if it ever goes on to that list...

This is probably going to be unpopular, but focussing on your career/increasing your income and improving your Japanese ability are probably going to have bigger short/medium term improvements on your quality of life over saving, which will in turn increase the amount you can put towards retirement. Of course you should do the saving too.

Agree with the others that gold is probably a distraction (I also did that when I was starting out btw, thankfully I sold it after learning more about investing and before the price plummeted, but that was pure luck).

You are probably much closer to making the next breakthrough with your Japanese than you think you are. It's basically an endless series of plateaus and "around N3" is were many of use have got stuck for years.

And, if you are interested in money/investing it's a super useful set of vocab to add.

Sure. You can seek out and English interface online bank.
Prestia will charge you 2,200 monthly if have less than 500,000 "relationship balance".
And ATM charges if you have under 1mil in the account.

SBI Net Bank (Japanese only), if you sign up for two factor authentication is likely to give you several free ATM visits and maybe even a number of free transfers to other domestic banks.

If you aren't already, try using a brower plug-in (Rikai chan/kun) to offer translations of words you highlight.
Have someone help you the first time doing something and take screen shots to make notes until you've got the vocab down.

I have to say, the SBI interface is very well laid out and the transfer screens are kinda effortless.

So yeah, maybe use your banking woes as an opportunity to push ahead with Japanese for something that interests you and might even save you a bit of money.

I was in a similar situation to you ("except" for the kid), and I'm recovering from it thanks to all the amazing people in this forum, so maybe this can help you a bit.

・The first thing that I did was to save aggressively and build a emergency fund of 500,000 yen in a traditional bank account. This money never gets touched unless it is indeed an emergency.
・Before investing in NISA or IDECO, I would invest in yourself. The JLPT is a good start. I was stuck in the N3 for years, but after finally getting serious about it, managed to go from the N3 to N1 (barely) in 2 years. Learned Kanji thanks to this website called WaniKani (it's paid, but totally worth it in my opinion). After passing the N1, took the TOEIC for the first time (I'm not an english native speaker) and got 970 points. Thanks to those 2 tests (maybe 15,000 yen in total?) managed to leave my crappy job, and find a slightly better job, boosting my monthly income by 50,000 yen (still low comparing to the average). Probably my best investment so far. So in addition to the JLPT, it could be an excellent option to also get some qualifications relevant to your job.
・After getting a slightly better job, opened a Tsumitate NISA and been investing monthly in the emaxis slim all country fund. After topping this year allowance, will try to raise my emergency fund to 600,000 yen.
・After that, since got married recently and looks like we will stay in Japan for a long time, will start my IDECO. If there's any money left, guess I'll buy more of emaxis slim all country on a taxable account.

Regarding the Banks, Sony Bank markets itself as an english-friendly bank. It isn't. The application procedure can be done in English, but the bank app itself is all in Japanese, so don't see the point. Please correct me if I'm wrong.
I would recommend learn a bit more of Japanese and go with SBI Net Bank.

Hope that this helps.