7 Things Expats Must Know Before Hiring a Financial Advisor

Most expats overpay for financial advice, or worse, pay for advice that was never designed for their situation. Before you hand over 1% of your portfolio every year, you need to know exactly what you are buying, who you are buying it from, and whether that person is even qualified to advise someone in your position. This post gives you seven concrete things to verify before you sign anything or transfer a single dollar.

1. Understand What "1% Per Year" Actually Costs You

The 1% annual management fee sounds harmless. On a $300,000 portfolio, it is $3,000 in year one. But that fee compounds against you the same way returns compound for you.

Over 20 years, assuming a 7% gross annual return, a 1% fee reduces your final portfolio value by approximately 18% compared to a 0% fee scenario. On $300,000, that difference exceeds $150,000 in lost wealth. That is not a rounding error.

What the Fee Should Cover

A legitimate advisory fee should include financial planning, portfolio management, rebalancing, tax-efficiency review (where applicable), and ongoing access to your advisor. If it only covers "investment management," you are not getting full value.

What You Should Be Asking

Ask for a full fee schedule in writing before your first meeting. Understand whether the 1% is charged on assets under management, on gross contributions, or on a flat retainer basis. Each structure changes your total cost significantly.

A British engineer based in Kuala Lumpur earning in MYR, contributing $3,000 per month, and planning to retire in 15 years needs a completely different fee conversation than someone with a lump sum to invest. Make sure the fee structure fits your actual situation.

2. Verify Regulatory Status Before Everything Else

Anyone can call themselves a financial advisor. Not everyone is regulated.

Before you share a single piece of financial information, verify that the advisor holds a current licence from a recognised regulatory authority. For expats in Southeast Asia, that means checking bodies such as the Labuan FSA in Malaysia, the Monetary Authority of Singapore, or the Securities and Exchange Commission in whichever jurisdiction applies to your case.

A regulated advisor operates under rules that govern how they can sell products, how they must disclose conflicts of interest, and what recourse you have if something goes wrong. An unregulated one gives you nothing to fall back on.

Why This Matters More for Expats

As an expatriate, you are often outside the jurisdiction of your home country's regulator. A UK national living in Dubai cannot easily rely on the FCA for protection if their advisor is based in a third country and unregistered. You need to know exactly which regulator covers your advisor and what that regulator's complaint process looks like. Ask directly. If the answer is vague, walk away.

3. Ask Whether They Work with Expats Specifically

General financial advisors are not equipped for expat complexity. Your situation involves multiple tax residencies, cross-border pension transfers, currency mismatch between income and retirement goals, and potentially estate planning across two or more legal systems.

An advisor who primarily serves domestic clients in one country will apply a framework that does not fit your life. You need someone who has handled QROPS or QNUPS transfers, who understands the implications of FATCA if you hold US assets, and who can navigate the interaction between your home country's tax rules and your country of residence.

A French executive based in Singapore earning in SGD with pension assets in France and investment accounts in Luxembourg needs advice that spans three jurisdictions simultaneously. Ask your prospective advisor directly: how many clients do you currently serve in a similar cross-border situation? If the answer is "a few" or unclear, that tells you everything.

As a useful baseline, reviewing how a genuinely expat-focused strategy is structured can help you ask better questions. This post on building a resilient expat portfolio covers the structural considerations in detail.

4. Establish Whether They Are Independent or Tied to Products

Some advisors are independent. Others are tied to a specific product range, a custodian, or a fund house. The difference matters enormously for your outcomes.

A tied advisor can only recommend products from an approved list. That list is determined by commercial relationships, not by what is best for your portfolio. An independent advisor, by contrast, has access to the full market and can recommend whatever is most appropriate for your situation, including low-cost UCITS ETFs, passive index funds, or bespoke multi-asset structures.

How to Spot a Tied Advisor

Ask: "Are you able to recommend any investment product on the market, or are you limited to a specific provider or platform?" A clear, direct answer is what you are looking for. If the explanation becomes complicated or defensive, you are likely talking to someone with commercial constraints on their advice.

Commission vs. Fee-Only

An advisor who earns commission from product providers has a structural conflict of interest. A fee-only advisor charges you directly and has no financial incentive to recommend one product over another. For high-income expats, fee-only advice is almost always the better model.

5. Understand the Investment Philosophy Before You Commit

You are not just hiring a person. You are buying into an investment philosophy. If you do not understand that philosophy before you sign, you have no basis for evaluating performance or holding your advisor accountable later.

Ask: "What is your core investment approach?" A credible answer will include a view on active versus passive management, an approach to risk management, and a clear framework for portfolio construction. Vague answers about "balanced portfolios" and "long-term growth" are not sufficient.

An American executive based in Jakarta earning in USD, planning to retire in Australia, needs to know whether their advisor understands currency risk in retirement income planning, not just how to build a standard 60/40 portfolio. Ask specific questions and expect specific answers.

The mathematics of long-term market returns, and why consistency of strategy matters far more than timing, are covered in depth in this analysis of 31 years of S&P 500 data.

6. Check Their Communication and Reporting Standards

You will be trusting this person with a significant portion of your net worth. You need to know exactly how often you will hear from them, what reporting you will receive, and how quickly they respond when you have a question.

Ask for a sample client report before you engage. It should show portfolio performance net of fees, asset allocation versus target, and a clear narrative of what happened and why. If the report is a single page with a fund balance and nothing else, that is not acceptable for someone at your income level.

For globally mobile professionals who may be in a different time zone or country within months, also establish how communication works across locations. Can you access your portfolio data online at any time? Is your advisor reachable via email, video call, and phone? These are basic standards that should not need to be negotiated.

7. Ask for a Written Financial Plan, Not Just a Product Recommendation

The most important distinction between genuine financial advice and product sales is this: a real advisor builds a financial plan before recommending anything.

That plan should include your current net worth, projected savings rate, retirement income target, expected residency changes, currency considerations, and risk tolerance. The product recommendations, whether they are UCITS funds, offshore bonds, or something else, should follow from the plan. Not the other way around.

If an advisor wants to put you into a product before they have documented your full financial picture, that is a significant warning sign. Insist on seeing the plan first. If they cannot produce one, you are not getting advice. You are being sold to.

Frequently Asked Questions

Q: Is a 1% financial advisor fee worth it for expats? A: It depends entirely on what is included. A 1% fee is reasonable if it covers comprehensive financial planning, portfolio management, rebalancing, and ongoing cross-border tax-efficiency guidance. It is poor value if it only covers basic investment administration. Always request a full breakdown of what the fee covers before agreeing to anything.

Q: What percentage should you pay a financial advisor as an expat? A: There is no universal standard, but 0.75% to 1.25% per year on assets under management is a common range for full-service advisory relationships. Some advisors charge flat retainer fees instead. The right structure depends on your portfolio size, complexity, and how frequently you need active planning support. Tax laws and regulations vary by jurisdiction and this is not tax advice.

Q: Is a 1% management fee acceptable for financial advice? A: It can be, provided the advisor is regulated, independent, and providing genuine financial planning rather than just product recommendations. For expats with complex cross-border situations, the value of good advice can far exceed the cost of the fee. The risk is paying 1% for service that a low-cost index fund and basic financial planning could replicate at a fraction of the cost.

Q: How do I verify if a financial advisor is regulated? A: Ask them directly which regulatory authority licenses them, then verify it independently on that regulator's public register. For Southeast Asia, check the Labuan FSA register in Malaysia or the MAS register in Singapore. Never rely solely on the advisor's claim. Regulated status should be verifiable online in under five minutes.

Q: What is the difference between a tied advisor and an independent one? A: A tied advisor can only recommend products from a specific provider or approved list, which limits objectivity. An independent advisor has access to the full market and is not commercially restricted in what they can recommend. For expats with complex needs, independent advice is almost always preferable.

Q: How is a 1% brokerage fee different from a financial advisor fee? A: A brokerage fee is typically a transaction cost paid when buying or selling investments. A financial advisor's annual management fee is an ongoing charge based on the total assets they manage for you. These are separate costs and can stack on top of each other. Always ask for a total cost of ownership figure, including all underlying fund charges and platform fees, before committing.

If you are an expatriate professional evaluating your current advisor or looking for your first, the most useful thing you can do is have a straightforward conversation about what you actually need. No pitch, no pressure, just clarity on where you stand and what your options are. Book a no-obligation call with Ciprian.

This content is for informational purposes only and does not constitute personalised financial, investment, or tax advice. By reading this post, you agree to our disclaimer.