Frank Reilly is president of Reilly Financial Advisors, a La Mesa, Calif.-based investment-adviser firm.
I work in a family business with my father, who started advising clients abroad thirty-seven years ago when his neighbors moved to the Middle East to work as schoolteachers. When the neighbors found that they had extra money for the first time in their lives, they asked my father to help with their investments. They also said they had friends who could use his services too. My mom and dad bought two plane tickets to Saudi Arabia and have been working with Americans who live and work overseas ever since.
What began as giving simple investment advice in Saudi Arabia became more robust and complex over the years as we incorporated tax planning, tax preparation, estate planning, and wealth management for clients in fifteen countries worldwide.
The most straightforward challenges to working with clients who live abroad include making international phone calls, sending mail, and understanding time zones. A client doesn’t want to be woken up at 2:00 AM for a discussion about their finances because an adviser doesn’t understand the time difference.
Beyond those basic challenges, however, financial planning for Americans who live and work overseas has become more difficult after September 11th and the Patriot Act. Many financial services firms no longer want to work with Americans who do not live in the United States. And some mutual funds have restrictions too.
More complex challenges encompass many different areas, such as currency fluctuations and political unrest. For instance, we have a client who is paid in U.S. dollars who own a home in Ireland with a mortgage in Euros. If the mortgage is €1,200 a month, that could be either $1,000 or $2,000, depending on exchange rates. Something that is normally a fixed cost suddenly becomes an unpredictable variable. And an adviser needs to stay in tune with global and macro-economic issues. How can you talk with a client in Greece if you don’t know about the destabilizing events there? How can you talk to a client in Hong Kong if you haven’t noticed a drop in Chinese inflation and export numbers?
Advising clients abroad almost always begins as it did for my dad — by knowing someone who moved abroad. If you know someone who got a job in Brazil, visit them and ask them to have a dinner party with their friends. Your overseas clientele can slowly build from there. You do need to start with some connection, though; you can’t just get on a plane to France and think you’re going to get a client.
Working with international clients makes up only 25% of our business, but it’s probably the part I enjoy most. You need to have a passion for the international lifestyle and enjoy visiting far-flung parts of the world to make it work, but it can be very rewarding.
This article was published in The Wall Street Journal at Financial Adviser on December 29, 2011.
Read more about Reilly Financial Advisors.