update: (7-14-2021): I sent an internal message to Vanguard about disposition of accounts when moving to a Canadian residence (and the response might vary depending on the expat's country of residence). I just got this reply...which is nice to have in writing. This may be useful now or in the future for other Vanguard owners.
Thank you for your email. I'm happy to provide clarification. Please note that no action will be taken due to a relocation until you change the address to a foreign address on your accounts.
You can continue to hold your existing accounts with Vanguard if you relocate to Canada. However, Vanguard does not open new retail accounts for Canadian residents, regardless of citizenship.
Also, Vanguard will not permit purchases or exchanges in existing accounts held by Canadian residents. Shareholders who relocate to Canada will no
longer be permitted to purchase or exchange shares in their fund accounts.
The policy for Canadian residents does not apply to reinvestments of dividends and capital gains within the originating fund
These policies apply to both the mutual fund and brokerage accounts.
If you have additional questions, we are happy to assist. Please contact us
at 877-662-7447. Our representatives are available business days 8 a.m. to
8 p.m., Eastern time.
Best regards,
A... E...
Registered Representative
Vanguard Retail Investor Group
Edit : thanks, I received some good comments. Rather discouraging though. How about my first bullet point? Sound unreasonable to live with that for a long time?
err, I need help.
I am about 99% along the path of moving from the US to Canada as a permanent resident with spousal sponsorship (wife has dual US and Canadian citizenship). I have not yet "landed" as an immigrant at the border, which is the final step, and we are still in the US. We will be retiring there as I am 69 and have no intention of working in either country.
I have become greatly concerned with expat financial/investing issues. I assumed that I could maintain my accounts at Vanguard but was informed that I'd be closed down. One of the last things I want is to be told something like I have 45 days to transfer our accounts elsewhere or they will mail me a check for the IRAs. That's the most distressing aspect, having the regular (non-Roth) IRAs being shut down and possibly taxed in full by the US as a distribution.
However, two Flagship representatives verified that the IRAs can be maintained, and one called back later to confirm that the taxable accounts can be maintained as well. But a huge restriction is that the only transactions permitted would be withdrawals. So, no new investments (not a problem) but that also means no rebalancing, no switching funds, etc. But I haven't been one to change things up too much over the years and I am generally comfortable with our asset allocation. Mostly invested in index funds (stock/bond) with a bit in VPMAX and VGHAX. So I am in a quandary.
- Based on the information from Vanguard one possible path is to leave our accounts at Vanguard (USA) while our residence is in Canada, This might not be so bad? I think that an asset allocation could be maintained through judicious withdrawals from the accounts. Or perhaps put everything into some sort of balanced fund?
(For reference, the accounts at Vanguard include $1.7M IRAs, $350K Roths, and $200K taxable.)
- Another technique that many people seem to use is to maintain some presence in the US. By having an actual property. Or by using the address of a relative, etc. I have seen discussion of this in the Financial Wisdom Forum (Canadian Bogleheads) as well as here and in other forums. I have read of potential problems with this method as well and really don't relish being subjected to huge fines and loss of capital.