(LIVESTREAM) Financial Planning For American Expats In The Gulf Region – 21st November 2022

 

VOICEOVER:

We invite you to attend the January 2023 Nomad Offshore Summit here in Lisbon, Portugal.

This podcast’s channel is about you. Successful international entrepreneurs, successful expats, successful investors, sponsored by HTJ.tax.

DERREN JOSEPH:

Great. Fantastic. So Tom, great to see you again. Welcome. So we’re gonna record this and we’re gonna, you know, put it on a lot of platforms, but right now is being Livestream on LinkedIn, on, on YouTube, on Twitter. Well, I don’t know if it’s still on

Twitter, Twitter, and Facebook. So, yeah. So for those who may be joining us on those platforms, HTJ.tax, we do those live streams every week where we talk all things tax. If you’re seeing us for the first time, have a look at HTJ.tax/events to see what’s coming up next. And every day we release what we hope to be helpful video content. So you can join us on your favorite platform there. So this, we actually publish on about 23, 24 platforms every day. You know, SoundCloud, SoundCloud, iTunes, Google Play, Amazon, wherever it is, you get your favorite podcast. Chances So, we are there as well. So without further, do I introduce you to Tom? Tom, can you please introduce yourself?

TOM PEWTRESS:

Sure, thanks. Thanks for having me. A pleasure to be here. And hello to everyone that may be tuning in today. My name’s Tom Pewtress. I work for Skyline Wealth Management. We, primarily focus on working with individuals who have moved abroad when it comes to financial planning. And we’ve got many offices around the world for intensive purposes. The offices are from the US all through the UK, Europe, and right over to here. I’m in Dubai. I’ve been out in Dubai for seven years now, I think. Yeah, I just, over seven years, something like that. So enjoy my time here in the Middle East and we’re licenway down, to Australia as a firm. So yeah, that, that’s, that’s me and who I work for. I guess from my point of view, I specialize in, working with us, connected Expats, like I said, based out here in Dubai, but I’m able to cover Europe from here, Africa from here, the Middle East, and Asia from here so far enough away from the US but still, well placed from a, a geographical point of view. And you know, we’ve got a good regulatory footprint across all those regions to make sure that we are the best place, to help people when it comes to cross-border finances.

DERREN JOSEPH:

Thank you for that. And, as you mentioned, regulatory, so my understanding is that you guys are SEC licensed, is that correct?

TOM PEWTRESS:

Yeah, yeah, licensed.

DERREN JOSEPH:

Right. This is, of course super important because unfortunately there may be other players in this space who aren’t properly licensed. So I think that’s, that’s an important thing to put out there, that you guys are licensed and credentialed to do what you do. You know, it’s, it’s important right now given other things happening in other spaces with other companies that may or may not have been licensed and registered. So,that’s super, that’s great. So second thing, well you, you mentioned US exposed persons, so I just wanted to kind of chip in and, and kind of define and refine what that means. So these are people that are the US exposed for tax purposes. So there would be US citizens regardless of where they may reside, US green card holders or lawful permanent residents, again, regardless of where they may actually reside, and those who may be US tax residents by virtue of substantial presence. So maybe they’re on an H one B one or they’re on an L one or whatever, and they’re spending sufficient time so that they’re trapped in the US tax net. And you offer products and services and helpful advice for those types people. Correct?

TOM PEWTRESS:

Yeah, absolutely. And, and you, we kind of have two sides to our business. We have a number of offices over in the US itself, so we have an office on the east coast, also on the West coast and large country trying to get across those time zones and the number of people that are over. We are helping Expats in the US, as our, as our main concept of business. We’ve always kind of been across-border financial planning firms helping Expats where they may be. And that’s kind of where our businlly started. And we went into a number of regions as a result of that. And again, you know, going back to your substantial presence test for those that on one visa and that kinda stuff working over the US that might be Europeans, British, South Africans, Australians over in, in the US that we help those guys there and my team on that side of the world helping connect to people in the US. Me being here in Dubai helping those Expats, those US Expats that have some sort of tie, whether it be through passport green cards or meet a lot of people who have been to the US in the past and, and have picked up a green card for being there for a certain period of time. And you know, there may be European passport holders, British passport holders, you know, GCC passport holders, but connect picked up that tie and that’s that, that’s where we work with any another kind of third parties to hone in on what it means to have, have that green card. Because I think a lot of people come away from the US not with a clue, sadly. Yeah. And dolly understand that bit of it. So we just try and, you know, work with people based on those, those ties and get them to, to understand what those, not necessarily their liabilities, you know, that’s not for US as financial, but to bring it to their attention that it is an area that needs to be addressed. And if it is something that they want to continue to hold in terms of having that tie, whether that be a passport, you know, a green card or even those that are married to us connected people again, they can kind of fall under that net of US connectedness to some degree. So we just then start to look at what their options are when it comes to financial planning and how and why it’s important to take note of that connection because there is ultimately a tax obligation that comes from it.

DERREN JOSEPH:

Absolutely. And that’s an important point you raise and thanks for that, that people get us connected and they don’t even realize it. So last Friday night I attended a gala hosted by the American Chamber in Dubai as well as US Embassy in Abu Dhabi. so you know, all these people, they were celebrating the anniversary of the historical relationship between the United States and the United Emirates, and Yeah, yeah. So many people who may be Emirati, go to university, it is of course a popular destination in terms of education, or they may work with a multinational and they spend considerable time in the US and whenever they return to the Emirates, they come back with passports, green cards, spouses, kids, whatever the case may be. That means suddenly somehow their family’s US is connected. so you’re right, it is more common than people realize.

TOM PEWTRESS:

I think it’s a big one as well for those that, you know, go over to the states and get educated there and then they stay on for maybe a couple of years, to enroll in work, et cetera. You know, it speaks to a lot of people from the Far East and Boston GCC that picked up that green card and, and didn’t know what the implication of it was and, you know, came back at home and stuffed it in a drawer. And it’s like those conversations on what I’m playing and one of the conversations that virtually any bank would have with you today to try and open up a bank account, right? Are you, a US connector a US passport, green card holder, they take yes. And then all this other paperwork comes out and it’s okay, that’s your factor declaration, but no one understands what that is and what it is there for, right? So yeah, it’s, it’s kind our job to just highlight that to people and the importance of it and, hopefully and encourage them to engage with, they’re getting the right third parties to go through that planning process.

DERREN JOSEPH:

Okay, great. So can you tell me, so like, if someone is the US exposed through family members or themselves personally or whatever, what are, what would you say are the top three things they need to look for in considering who’s the right financial advisor for them?

TOM PEWTRESS:

Yeah, good, good question. I, I think, I think the list could be a lot more than three now, but I think one thing that we touched on earlier, and you kind of highlighted as, as I introduced myself there, is just making sure that your advisors regulated. I can’t stress the importance of that. You know, I look around the world and there are varying degrees of regulation and in the US we have the GCC, which overlooks, you know, the majority of financial services. And I think if anyone’s watched a film, you know, the GCC is the big bad wolf kind of scenario, but, you know, they’re a regulator there to protect a consumer. And that’s important. And I think when you are looking for advice, you have to make sure that the person you’re engaging with has, has that level of protection for the consumers. I think specifically for us connected people, kind of the second point is then does that advisor in whatever capacity he is regulated, does he have a US-specific proposition? So, you know,, your advisor may be regulated, for example, here in the UAE by, you know, the DIFC or the securities and commodities authority. But does that regulated advisor have, a proposition that is tailored towards somebody who is, of US connection? And that’s important, and I’ll come onto that probably later because there are things that, again, because of u connection, because of that tax reporting requirement and that liability in the future, you need to make sure that the solutions that you’re taking on board are specific to you. And I think the third thing as well, and this is probably one that goes missed quite a lot, but is, is important to me is what capacity is that person providing advice to you in? So I meet a lot of people where they’ve engaged with the financial advisor and all they’ve done is given their money to an investment bank who have just risk profiled somebody for somebody and sold them a load of financial instruments. And whilst that’s great cause your money potentially is working for you, has it been done in the right way or are you just, you know, are you just investing at that point? And I think there are varying degrees of how somebody can sit in your life and from a financial point of view. And it’s just understanding what that role is because I think there are so many roles out there and to engage in advice on, you know there’s robot for example, you know, Robot advisory, that’s just very simple. It’s, you know, plug and play. It’s having someone like me who, you know, we would class ourselves as financial planners and we are here to kind of map the journey. You know, investment management is something that we do, but it is, it’s almost a secondary item on the list. So we engage with people about, okay, where are you today? What do you wanna achieve in the future? You know, we do a lot of goal-based planning and that’s kind of the big part of our proposition and making sure that we’re along the journey with you. We’re not here just to make a transactional sale. And some people want that, some people need that, but it’s just understanding what, what capacity you’re employing that person when it comes to looking for finance.

DERREN JOSEPH:

Okay, that’s great. And, to pick up on the second point that you raised, there are a lot of investment products or financial instruments available. I mean, the list is probably endless. Yeah. How does someone decide what’s the best fit for them? What’s that process look like?

TOM PEWTRESS:

Yeah, again, it goes back to making sure that it is that us specific proposition for me because sadly where, where people or us people have engaged and, and tried to get advice internationally, you know if we look back over the last 12 years now since kind of that implementation of FATCA in 2010 and, and people starting to take notice of it up until kind of 2012, where foreign institutions caught on what was going on. But you know, you had, before 2010, had the entire world to talk to as a US person. You know you had all the financial institutions globally. If you’re an ex-pat working in the Middle East, you know, anybody you talk to, anybody would provide you advice and anybody would take you on as a client post that 2010 factor initiative, then, then that world shrink because those, those Offshore institutions didn’t necessarily want to deal with you as a person because you had that US connection. And much of that planning then went back to the US. But then since 2015, I’d say probably HSBC be wanting the first kind of, then the pressure from the GCC and the increased KYC and AML requirements for, banking and investment device in the US started to get harder. So the world has started to swim. So whilst the universe is huge, it’s becoming quite constricted. I think it’s probably one of the biggest reasons why, certainly from our point of view, the US market is vastly underserved today. But for those that have had financial advice or those that are seeking financial advice, one, thing to be aware of is that it has to be that US-specific proposition because taking advice from an individual who doesn’t, or a firm that doesn’t and doesn’t have access to the right solutions, you know if you end up with a nondomiciled US solution. So, you know, let’s take mutual funds for a second. If, if you’re not familiar with what a mutual fund is, it’s, a collective investment vehicle based on maybe an indie or a sector or geography. Let’s take North America for example. You could have money invested in a North American mutual fund and it would be virtually invested in kind of the SMP in the wider market. But if that wasn’t if that fund house hadn’t based its fund out of America and it had based itself out of, let’s say Luxembourg or Island, for example, two very popular jurisdictions for, for non-US mutual funds, those are what we would call passive foreign investment companies or PFIs, right? And as an American, you don’t want to end up with one of those Derren, you’ll be probably able to tell people more why you don’t want to end up one of those, but ultimately they’re just taxed punitively. So really it’s the number one thing from my point of view, as an ex-pat, it’s easy, it’s probably the easiest thing to end up with the worst thing as a result because, you know, it’s just, it’s just not good from a tax planning point of view and a, and a financial planning point of view. So thally something to stay away from. I think when trying to understand what you need to have in, in your life it’s, again, sitting down and, and understanding what, what part to play that investment vehicle has. So again, I’ve seen, sadly I’ve seen, you know, people try and seek advice, a financial planner or financial advisor or an investment bank, private bank, whatever it may be, whatever kind of scope or engagement that person on, try and do the right thing. So, you know, maybe invest money through US rappers, for example, pension rappers for example, that have been quite popular over the last decade or so. And that allows a US person not necessarily to end up with US domicile assets, but they can end up with foreign or pix. But in a wrap scenario, it doesn’t cause that tax problem, but what it does is it puts that money in an environment where potentially there are limitations on access and consequences on drawdown. So again, just to kind of simplify that, it’s, you know, if you’ve met somebody or you’re talking to somebody who’s encouraging you to invest in a, in a rapper or a structure that, that allows you to invest in this big huge universe of, of investments that, that are available to so many, just understand what that rapper is and what the consequences are of doing it. You know, so kind of the second point, but the first point is, you know, make sure it’s US domicile that that’s the first one we need to make sure that we’ve got the right thing in place. Make sure that the structure of what you’re investing in is suitable for you. So if it is an Offshore wrapper, for example, does it meet your criteria for the future? It might be a US domicile structure. So you know, for example, we have various different types of accounts in the US we have just a general investment account or a brokerage account, right? That’s just, youcano put money in and take money out as and when you need to, but then you have ROTH IRAs, traditional IRAs, 401ks, five 20 nines, all these other structures. I think it’s important just to understand the structure that you are investing through and, and make sure that you know the limitations of that and what it can and can’t do for you. And then kind of thirdly, the last one is, and this applies to all those structures across the board, and this is probably the most important one for me, is just understanding the investment strategy. So if you have got the right advice, and it is US domicile, so you’re investing in US investments, whether it be ETFs or mutual funds or direct stocks, et cetera, and it’s in a vehicle that you want it to be in. So just a brokerage account, understand then how that money is being invested in the journey that that money is going on. So make sure your risk profiling around that money is the right one for you. Again, I see so many people who as a knee-jerk reaction would be quite a cautious investor because it may be their first time investing, for example, but they’re investing, that money, that specific money that they’re taking advice on for their retirement or for a future date, which is, you know, wmore thans of 10, 15 years. But taking a cautious approach to that money may not always be the right thing to do. And similarly, you know, people who are very keen on investments, low investing may take the kind of a very high-risk attitude to a very short duration. And especially in markets, this year is not an anomaly. People are looking at the markets and worrying, guys, be aware it’s not an anomaly. It might be an anomaly in your investing lifetime, but trust me, this has happened 14 times since the seventies, you know, 20 times plus since the last world war we had, we see huge market sales. We know that these things do happen, but just understand how your money is invested, the type of risk associated with the portfolio that, you’ve chosen, and then what you can expect through that journey. And then the most important thing is coming towards that liquidation event and having that, again, that same right attitude of risk associated with the portfolio. So they’re kind of the three things. They’re not, you know, I can’t ever say, you know, you should be solely invested in this or solely invested in that, that, that, that’s not what we do. We kind of just try and put that plan around that investment. And that’s why I said that for us, the planning part is the most important. Investment management comes second because if you can answer these questions as that client goes through the journey, you end up kind of tailor makes itself by the time you answer the questions. But they’re the three things for me. You know, make sure it’s US specific, make sure you know the rapper or the structure that you’re investing through, and then just be aware of the risk profile that you are, that you’re allocating to that portfolio.

DERREN JOSEPH:

Thank you for that. Again, very comprehensive. I just wanted, talk a bit about the second point you raised about being cautious with products and platforms that may not be US domicile. And as you mentioned, PFIs, right? The pacify foreign investment companies, there is a very specific and credible risks. I mean, just this morning, you know, speaking to a client in Singapore who is about to make an important decision, he’s getting married and stuff like that. So he’s just going through his affairs and he realizes that he has PFIs because he invested in products that were pitched at him. And, for those who are not aware, I just wanna kind of speak, to what these acronyms mean. So KYC, those, you know, your customer stuff that the banks take you through, that’s why it takes such a long time. AML, anti-money laundering, and PFIs, as we said, passing foreign investment companies as to the origin of PFI they did back to the 1980s at the President Reagan. So during that term, we saw the creation of, well, section 1297, which speaks to, as Tom said, those collective investment vehicles where at least 75% of that structure is gross income is passive, or 50% of the assets are investment held to create passive income. So basically a non, you’re thinking in terms of a non-US mutual fund. So sometimes they call unit trust and then, you know, as you mentioned Tom, Tom mentioned rappers. So sometimes something may appear to be a pension, a non-US pension, some non-US retirement product or some non-US insurance product. And when as US tax professionals, we take a look inside as we did with our client this morning, then oops, you have a, you have a PFI. So again, it’s really good, I mean, just on the side of caution and just stick to as much as possible if you just wanna be super conservative with US domicile products. But if not, if you, if you want to look outside, then just definitely get advice before you jump in because the reason why PFIs were created was that the US domestic financial institutions began complaining to Congress that, hey, Americans are getting an advantage by investing outside of the US. They’re getting a tax advantage, they don’t pay tax until there’s a distribution way at the end. And that put them, these, they put these foreign products at an advantage compared to US domestic products, which is unfair. So the IRS, so when you, when we talk about PFIs, PFIs are, you know, a bit aggressive, and they, they are aggressive by design. So, it’s a section of the tax code that penalizes you as a US-exposed person in investing in that foreign collective investment vehicle if it does trigger PFI data. So yeah, you know, to your point, definitely keep an eye on them, get advice and, you know, maybe it’s best to stay away depending on your situation. Now you, you mentioned some of the various products and, and stuff like that. I have to ask, I know it’s a bit of a controversial thing right now, but crypto, when do you see crypto is, is it, is it over, is it like forget it, run for the hills, avoid it? Or are you saying, well, in part of a well-diversified portfolio, maybe it has a place? What are your thoughts on that?

TOM PEWTRESS:

I’ll be honest, you know, we, I get asked about crypto all the time, right? It’s hot topic only last week. FTX has blown up and you know, more than 3 billion people. It’s, it can be a sad story. And I think a lot of retail Investors have had their fingers burnt over the last decade since crypto’s been around. And I get me wrong, there are some people who’ve made a lot, a lot of money from it. Yeah. Are, again, let me very, very clear and very honest from our point of view. And from my point of view, it’s just not something we advise on at the moment and it doesn’t appear in our portfolios and, and the way that we manage money clients, you know, to give an example of how somebody may gain exposure to cryptos through our way of investing, wy, you know, we build very broad-based investments. We manage, you know, stock portfolios, ETF portfolios, mutual fund portfolios, whatever it may be. But don’t forget, you know, crypto’s starting to come mainstream to a degree now. And some companies are listed on stock exchanges, you know, like Coinbase for example, right? It appears on a stock exchange. So if you are investing in the s and p 500 or NASDAQ or you know, whatever indice it may be around the world, you may be starting to pick up exposure to crypto companies, not tokens or coins per se, but crypto companies now just through the traditional way of investing, right? This is something that we can see in our portfolios, but we are not advising, and you know, we don’t think it’s a market yet that is mature enough or regulated enough to advise clients to buy Bitcoin, to buy Ether, to buy any of these other, other things that are on the market. It’s just not something that we’re at with, and I think it’s probably gonna be some time.

DERREN JOSEPH:

Okay. Completely understood. For those who just joined us, we did receive some of your questions in advance, and thanks for that. If you have questions, please just type them in the box below, if you’re in Zoom or the chat box below in any of the other platforms when we get to them in the order industry receive, so it’s not too late, you can ask questions below. So, we’ve already discussed crypto, what about precious metals? I have some clients that are bullish when it comes to their precious metals. What are your thoughts?

TOM PEWTRESS:

Potentially rightfully so as well? You know, I think from our point of view, precious metals are something that we do see as a good store of wealth at times, and they can and will feature in some of our portfolios at times. You know, we have got exposure to something like gold, for example, right? Or even the broader base of precious metals including silver and whatever else may go through. I think it’s been an interesting year for precious metals, especially gold. Gold is always one of those things that many people would hoard or buy for, for fighting off inflation and, and, and keeping inflation at arms length and allowing, you know, it, to increase in value over the years. But like everything, I think, you know, everything has a time and a place and it comes down to what the client is trying to achieve over the time horizon for that goal.

DERREN JOSEPH:

Okay, gotcha. Absolutely. So the next question, you are in United Alabama, it’s, you’re in Dubai. Dubai kind of came into its own, I tell people like during the recent pandemic, yeah, at one point in time it was like the only international city that was open. Everyone else airports were closed more or less aside from Dubai and you know, and of course, with the recent unfortunate conflict in northern Europe, it has become even more of a haven for, you know, for Entrepreneurs. For Investors. Would you, what brought you would make that decision to relocate to Dubai? And would you recommend it to others? And if so, what type of person do you think would benefit from moving to Dubai? Just curious.

TOM PEWTRESS:

I like that. I like, I, I was always fascinated. I, so I come, I’m British, obviously, and to kind of just go back on a little bit about who and why I am, you know, I’m British, I have no US connection, but I have been working with the USA market now for the kind of last five out of the seven years I’ve been here. I came here, I’m originally from the country, for intensive purposes in the UK. I come from the very green hills of, the Midlands and in the UK. And I was kind of attracted to the UAE came in 2015 and it was, you know, the glitz and the glamor if you like, in terms of having the seven-star hotel, Burj Khalifa. It was somewhere that was probably very, very different from where I was original as an extreme version of going somewhere. I’ve always been somebody that has traveled a lot and I believe that you can learn a lot from, a lot from traveling a lot of my education has been done from traveling and it was somewhere that was just completely different from a point of view of, you know, looking at the buyer the last seven years, it has just come into its own, you know, through technology and convenience to like things like Deliveroo and just, you know, things just city things like that. It, it, it’s a very convenient place to be. The UA in its built itself on lending an arm to convenience and attracting people to convenience. It’s changed drastically and, and, and it does want people to be here. It’s always, it’s always tried to bring people here. But I think one of the things that I first noticed when I came here was how transient it was and how, you know, the duration of time people was here was, was quite limited, you know, a couple of years, two to three years everyone came out with that mentality. I’ll, I’ll come for two to three years contracts were being issued for two to three years. I’ll go make some money and then I’ll go back home. I think it was probably one of the reasons why many, many governments, you know, made, made sure they had a good way of enforcing substantial presence tests and that kind of stuff. You know, coming here, making good money for six months in the oils, and going home. But I think, you know, over the last seven years it is changed dramatically and I think that that can be seen through some of the initiatives that they’ve now launched around visas. You know, got, you’ve got visas, for example, being able to stay here for 10 years, not necessarily needing a job, invests buying property here. Again, just allowing you to extend that period and start to settle in. And I think the most recent thing, you know, that kind of stuff came to fruition through and that lockdown period, you know, they’re wanting to attract them. They did lose people through covid, you know, no two ways about it. We lost a good proportion of the ex-pat population here, but they launched those initiatives to try and drive people back here as quickly as possible. And I have to say though that pandemic, they, they managed it very well. We’re quite fortunate here where, you know, someone’s, if, if the government say something, people do it and people adhere to it and it’s just, it’s been a very pleasant place to be over the last couple of years and people have been able to get on as a result of it, you know, actually go to get back to some sort of normal living. I think the UAE moving forward is just a huge opportunity. You know, we obviously have our neighbors over in, in Saudi Arabia who is building things up a neon project and trying to continue to think they’re probably where the UAE was, you know, 10, 15 years ago in terms of that initial caption. But I think just from a big opportunity place now is, you know, you’ve got major corporations moving here, you’ve got a fantastic work-life balance. You know, we have some 365 with a couple of rainy days to, to break it up, you know, we’ve got the beach, we’ve got the mountains, we’ve got all sorts of stuff going on and an economy that is growing on one of very few this year that, that is growing and next year that’s, that’s predicted to grow. So just fantastic job prospects. I think if you are looking to make a move, put the UAE (US expat tax UAE) on the list and come check it out, say hello and if you need me to show you around, let me know and I’m happy to be a tour guide for that.

DERREN JOSEPH:

Fantastic. Yeah, I 100% agree with you because, you know, having gone through it ourselves, you know, setting up a free zone company, finding office space, getting the Emirates IDs, the process has been so streamlined and made so easy and especially it, it, it stands in more contrast to other financial centers like Singapore, Hong Kong, New York, London, Switzerland, Zurich, you know, it’s those, I mean they’re attractive jurisdictions, but they just make us really hard to, to get in and to set stuff up with, you know, the UAE is the complete, complete, complete opposite. So I 100% agree with you now. Yeah, I think we’ve answered, we hold on someone just, okay, we have a question here. What type of ILUL index linked universal life of the best suited for us by living in the UAE who intends to go back to the US after 10 to 15 years? Is there a restriction or disadvantage on Offshore regular savings plans? Tom?

TOM PEWTRESS:

Yeah, a big one. So index-linked universal life plans, are insurance-based products, very, very common in the US as part of potential financial planning and how you use them. What I would say is one thing, it’s very, it’s quite difficult to purchase an onshore, what I say onshore US domiciled insurance product. A lot of the time the insurance company will require you to be in the US at the time of signing that documentation and even doing it by DocuSign these days they’ll track the IP and all this stuff. So there is a big part of the Ts and Cs that requires you to be in the US to sign that document. So it is potentially not always easy for USAT to buy those types of products. You know, those typical index links, universal life products or you know, they typically have a cash value to them. They have you grow your money, they offer protection from the downside. They can sometimes be a little bit mis-sold and represented as investments rather than protection. So you just have to make sure that you’re understanding what you, again, what you’re trying to achieve through that structure because it obviously, you know, with every positive there’s always potentially a negative with it. So you just need to understand what that is. And again, trying to assess what the right one is for you is going through that financial planning process and understanding, you know, what is it that you’re trying to do with this money, right? If you’re intending to go back to the US after 10 to 15 years, okay, great, that’s, that’s a life event, but is that a liquidation event just because you’re going back in 10 to 15 years, do you need all that money then? If you put, if you are either regularly contributing to that IUL or you put a lump sum into it, you know, do you need all that money straight back out then, you know, when we take money out of those types of products, kind of first in last out mentality, what’s the tax implications of it? Again, is it the right structure to use as something you’re trying to grow your money, or are you trying to protect something, right? So it’s trying to understand what you’re trying to do with that product. And that’s why, going back to your earlier question, you know, what are those three points? One of them is understanding the structure for me and it’s so, so important and I think just be careful because people can dress stuff up for something that it’s not supposed to be. The second part of that question, is there a restriction or a disadvantage on Offshore regular savings plans? Goes back to what we said earlier and if this person missed that, no worries. Yes, disadvantage stay away is probably the big answer to that one because that’s gonna fall into that PFIC category where we’ve got a passive foreign investment company, you’re gonna see big punitive taxes coming at you and a large accountant built from their end to do all the reporting is probably something that you’re not gonna wanna hold onto. So if you’ve got one already, come and see somebody, whether it be me or any of my team or somebody that has a US-specific proposition to understand what that is and how you can use it potentially get out of it or stay away from it in the first place would be, again, this isn’t advice, specific advice is that cater to, to those individuals, but just have a look at it first.

DERREN JOSEPH:

Absolutely. Absolutely. So the rules around those as you pointed out, are pretty strict because I think I do have that product and I had to execute that contract on US soil, so I was in the US Yeah. To sign up and go through the little interview and answer the questions and stuff like that. So yeah, if it is that somebody’s offering that outside of the US, outside of a US platform or US company, it is something, you know, you might wanna ask a few more questions to make sure that you, you’re not heading in a direction that’ll be painful from a tax point of view, at least far less from an actual insurance compliance point of view, later on, there may be some pain in that.So, yeah, I hope that helps. Now that leads to, I guess looking for, yes, we see Korea. Thank you for Korea’s pointing out that her company helps people set up and incorporate in Dubai. Yep. Thanks for sharing that. Tom, if somebody wanted to reach you or a member of your team, what’s the best way to do that?

TOM PEWTRESS:

Yeah, you can go to skylinewealth.com and literally just we have a contact that box on there easy enough, you can, you can write to me through those, that service there that that’s probably the easiest way to get hold of me. Those, those emails go directly to my administration team and we monitor those pretty much all day every day. So yeah, skywealth.com please, please feel free to reach out.

DERREN JOSEPH:

Okay, that sounds pretty simple. Easy to find. skyboundwealth.com. Tom, thank you for sharing some of your time today and sharing your expertise. Thank you very much. Appreciate it.

TOM PEWTRESS:

My pleasure, and good to see you.

DERREN JOSEPH:

Okay, have a good one. Bye-Bye.

OUTRO:

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Table of Contents: (LIVESTREAM) Financial Planning For American Expats In The Gulf Region – 21st November 2022

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