Transcript
Intro
Stephan Shipe: Welcome back to the Scholar Wealth Podcast. This week we’re looking at two sides of global wealth management. First, we’ll look at how investors living outside of the United States can access diversified ETFs without triggering tax complications. Then we will shift to the institutional side: how family offices should think about updating their investment policy statements or IPS as their structure, assets, and priorities evolve.
And finally we’ll talk to professional holiday designer Christine Mango, about how families approach high-end holiday decor and what it means to create spaces that feel festive, timeless, and personal. So let’s go ahead and get started with question one.
Question 1 – Non-US Resident ETF Access
Listener: As a non-US resident, I can’t directly invest in US domiciled ETFs without creating potential estate withholding tax exposure. Do I have access to any other funds?
Stephan Shipe: Outside of the US, things get really difficult. And the reason for that is when most people are thinking about index, they’re thinking like a Vanguard fund and you can get Vanguard funds in the US and they’re very robust and you have lots of options and index funds are gonna be synonymous with lower fees and a lot of optionality associated with the investments that you can get.
So when you go outside of the US, a lot of people take for granted those options that we have in the US. So outside the US we don’t have those same types of options. There are some that come really close and actually Vanguard has some ways to do this as well. You’re not going to have nearly as many index options as you do in the US, and the fees will be slightly higher.
But if we wanna break that down a little bit, what you’re dealing with is the issue of US and non-US domiciled funds. So domiciled funds just means where the fund is registered. So a US domiciled fund just means it’s registered within the United States, so it has to go through the SEC and all of these things.
When you have non-US funds, the options drop drastically and you’re gonna have a lot of trouble there with investments, especially on the tax and estate side. The reason for that is when you get into a US fund that you’re investing in outside of the US, the US gets a little concerned when you are investing in a United States Vanguard index fund, let’s say, and that fund pays you a dividend. The United States will withhold 30 percent for taxes on that dividend, so that’s really going to eat into your return for tax purposes.
The other issue is that in a lot of different countries, the US will also charge estate tax on anything over $60,000 — a really low number — on any of these US-domiciled funds that are held by someone outside the United States. So those are two huge hits.
Now, there’s different tax treaties in place and everything that’ll help with that a little bit depending on the country. For example, typically what people will do is invest in Ireland-domiciled funds or Luxembourg-domiciled funds, as they have a little bit better tax treatment. Ireland tends to be the one that most people would jump into.
So the way that would work is you would invest in a fund domiciled in Ireland that is also an index fund. So Vanguard would have some Ireland-domiciled funds for you to invest in. Again, not nearly as many. The liquidity’s not going to be as good, but you’re still gonna have pretty tight bid-ask spreads to be able to get into these funds. The fees will also be a little higher.
For comparison, if you had a US-domiciled S&P 500 index fund, you’re probably looking at three to five basis points of cost. Where if you look at an Irish-domiciled fund that would be like an all-world fund or a US fund, a total US market fund, or an S&P fund, you’re probably looking at somewhere around 10 basis points, maybe 20 basis points. So on a percentage perspective it’s considerably higher, but in an actual practicality perspective, they’re still pretty low-cost funds that you’re gonna be investing in.
What’s nice about that is Ireland and the US have tax treaties, so they’ll only withhold the 15 percent on any of those dividends. So that could be a big advantage of investing in that. And because it’s not domiciled in the US and it’s domiciled in Ireland, you’re removing that estate tax exposure as well as a non-resident. So, huge benefits of doing that if you’re outside of the US going into one of these Irish funds.
The downside — again — liquidity’s gonna be a little lower, expenses are gonna be a little bit higher, you’re still gonna be paying withholding 15 percent on the dividends, so be careful of that.
One thing to keep in mind is if you’re really looking at your asset allocation from a bigger perspective, if you’re going to be investing in something that pays higher dividends, then that’s something you may wanna prioritize going to an Irish-domiciled ETF. However, let’s say you’re investing in a small-cap growth fund that you don’t have a lot of good non-US options. Then it may make sense from a tax perspective — at least on the ongoing annual tax perspective — to still invest in a US fund because they’re not gonna be paying out as many dividends. You just have that same estate exposure that would be a problem depending on how big of an issue estate tax would be to your particular situation.
So the short answer to your question: you can technically get into these US funds. They’re gonna have problems on the tax side. You do have options outside of the US, especially if you deal with some of these Irish-domiciled ETFs or funds. So that can work well. Just know that it’s not a perfect match, but it’s the best match you’re gonna get outside of the United States if you’re looking for that index fund exposure.
And now we can move on to our next question.
Question 2 – Investment Policy Statement Refresh
Listener: Our family office investment policy statement hasn’t been touched since 2012. We’ve added a donor-advised fund, increased our alternatives allocation, and now have two family branches making joint decisions. Any recommendations on what to include in a 2026 IPS refresh?
Stephan Shipe: Lots of other things to unpack here because we have likely a lot to include. Way too much time has passed before going and updating the investment policy statement. And the reason for that is the investment policy statement is the guiding light to all investment and financial decisions that are being made for your portfolio.
So if it hasn’t been updated since 2012, we have a lot of time that has passed. I mean, 2012 interest rates were zero. Bitcoin wasn’t even a thing. This is pre COVID, pre the big rush of alternatives. There’s a lot of stuff that’s happened since 2012 that you’ve got a guiding light that’s… its batteries are dead. There’s nothing that’s really guiding anything at this point. So it’s really hard to make financial decisions when we talk about things like you’re saying you’re bringing in DAFs and you’re looking at different types of branches on the tree for the family office. We’re not even incorporating them, and the odds are that those branches have grown over the past 12, 13 years that we need to take into account.
So the first thing we need to worry about is this needs to have a policy in place before we even think about what’s going to be included in 2026. Going forward, we shouldn’t be letting 12 to 13 years gap before this gets updated again. This needs to be more of a living document that we’re constantly thinking about and saying, hey, every three to five years we’re going to go through and update this with these different changes.
Because the idea here is that we should have an investment policy that also changes with the times. It needs to have modern benchmarking included. We need to make sure that performance evaluation makes sense. Ten, twelve years are definitely multiple market cycles, possibly multiple economic cycles that are happening during that time. So we need to make sure we’re going back and saying, does it make sense? Maybe back then you were okay with very little investments in fixed income because interest rates were nothing. So it didn’t make a lot of sense. And now that interest rates have increased significantly, does that change? Probably should. It probably should at least reevaluate whether or not that makes sense.
And we should look back at what types of funds you’re investing in. What types of assets are going to be included here? And then, because assuming from what it sounds like, this is a multi-generational scenario that we’re dealing with, how are the kids being incorporated into these plans? How is the next generation being included to say, do they have a say in how the investments are looking? What type of philanthropic goals do they have and should any of that change?
So all of that needs to be included in this investment policy statement. We need to start looking at overall asset allocation, what’s the overall risk tolerance for the portfolio? And then thinking about, especially on the philanthropic goals, do we feel that the donor-advised fund is the best way to go right now? Should we be thinking about more of a foundation shift? Who makes the decisions for the allocation of the charitable giving within those funds? Is that still on you or is there a structure in place for the family to make those decisions?
If you have any, which I imagine you likely will if you don’t already, any family limited partnerships that get mixed into this play… who’s making all the decisions? Who’s calling the shots? The goal of this investment policy statement is that it goes beyond one person or one level of the family tree and starts to set the precedent for what all future investment decisions and financial decisions are going to be made off of. So as time goes on, we absolutely want that to change and also to include the next generation so that one day they look at the investment policy statement and they’re making updates to it. And it’s not just thrown at them as, hey, by the way, you have all of this money under your control and we need a new investment policy statement. We want them involved in that process early so they can see and have a say in what that process looks like.
And that really goes down to the bigger goal here of just communication and succession planning. You want to start looking at this investment policy statement as a way to express what values that you have and the role of finances in expanding those values or manifesting those values in different ways.
So when we’re talking about inclusion of this, to get more directly to what recommendations to include in the IPS refresh, I think it’s a great time to start looking at current economic conditions and whether or not an asset allocation that was made in 2012 still makes sense in 2025 and into 2026. Especially when you’re looking at an investment policy statement for 26 that is expected to be 26 through 2030.
We need to start looking heavily at those philanthropic goals that were set at that time. And who makes those decisions. Risk parameters to reflect now the addition of these private investments that you’re mixing in there. Are they being accurately reflected and accurately marked from a risk perspective to balance out anything else? And then liquidity as well. So what are the goals of the family finances now, and is there enough liquidity, especially with these private investments now being mixed in, to actually fund the goals that the investment policy statement should be funding and that the account should be funding.
So I think that that’s a good place to start, is really looking at those overall values, your overall goals, and then breaking down the more specifics and what I would consider the more granular aspects of the giving, the DAFs, the possibility of a foundation, overall asset allocation, liquidity, risk parameters, and just overall time goals for what everyone has in place. And of course you can get into the tax side and everything, which has also changed a lot since 2012. So another reason to make sure that that’s updated.
From the Field – Holiday Design with Christine Mango
Stephan Shipe: And for today’s from the field segment, we’re getting into the spirit of the season. With the holidays right around the corner, I spoke with designer Christine Mango about what goes into creating truly memorable holiday spaces, the planning, the trends, and the details.
Joining me today is Christine Mango, founder of Christine Mango Designs. Christine has spent decades creating holiday designs for celebrity homes, luxury hotels, and even iconic TV sets from Friends and Young and the Restless. Christine, thanks for joining us today. Can you tell us a little bit about yourself, your background, how you got into all of this?
Christine Mango: Well, thank you for having me. I just had a knack for the holiday decorating ever since I was a kid, and someone saw my work that works in the movie industry and she invited me to make items, specialty items for a movie called Meet Wally Sparks with, get this, Rodney Dangerfield. So that’s how long ago this was. And then from there it caught on.
But you know, my real expertise was Christmas and the set decorators on a lot of TV shows. They have set dressers and designers, but no one that really had a knack for Christmas. So I ended up doing the coffee house Central Perk and Monica’s apartment and the boys’ apartment and it caught on. And being artificial was something that a lot of these productions really enjoyed because I didn’t have to bring in everything fresh after a couple days if they didn’t get the shot in. There was a lot of continuity. Young and the Restless, they would put my tree on a roller and they’d roll it into one room or then roll it into the hospital and then roll it, you know.
And then I moved over to office buildings and used to do a lot of office buildings on Wilshire Boulevard, San Vicente, and Brentwood all over Los Angeles. And also I just focused on homes and fell into quite a few celebrity homes, and I did the Stallone’s house, Gene Simmons, Shannon Tweed, and Lance Bass, and still I’m doing it today. Been going for twenty eight years I believe I’ve been decorating. I try to do something charitable every year. I’ve decorated for an all girls rehab center, went in there and showed them how to light a tree and we made decorations together and tried to inspire them.
Stephan Shipe: So what does that look like when a family calls you and says, we want you to come in and decorate our house? Because you’ve done the gamut there from the hotel to the bigger homes. What does full service holiday decorating look like?
Christine Mango: First is an in home or onsite visit with whomever is making the decisions and I give them my ideas. Some say, I want the tree there, that’s it. And others say, where do you suggest, tell me what you think. And then we walk through. And that way I can see their colors, their style, their traditions. If I go into a contemporary home, most of them don’t want a traditional or a whimsical look. And color is important. I try to coordinate all my ribbons and ornaments with the colors of their home or the building, wherever.
And then we discuss budget. A lot of them say, I don’t care, and you do everything, just tell me what it is. Then there’s others that are frugal and say, this is how much I want to spend, or let’s cut back here. Give me the big list and let’s cut back. I charge everyone the same. I have a day rate, and no matter how wealthy you are or how much you are on a budget, it’s the same. I charge the same day rate. Buying the product is where it can add up. But once they buy a product the first year, they can use it over and over for seven, eight years.
Stephan Shipe: How soon do people start bringing you in to start decorating their house? And then how long does it take? Is it a one day setup? They leave for work and they come back home and they have a fully decorated house?
Christine Mango: Sometimes we can do it in one day. I have my elves. Then I work with another designer who’s fabulous, Bradley Schmidt. We work together often. People know us as Mango and Schmidt, and we can go in and crank out a house. Bigger homes, they can take two, three days, but that’s max. But yeah, I have a beautiful, very large home in Santa Barbara that I have a big enough crew. We crank it out in one day, get there early, and by the time they come home it’s done.
Stephan Shipe: That normally start around Thanksgiving? Is that really where it starts or is it earlier in November?
Christine Mango: It used to be around Thanksgiving. I don’t know what’s going on. I decorated my first home with Bradley and I did Sunday, October whatever that was, 17th, 18th, on Sunday. Monday we did a home. And then I have a home the day after Halloween, and then it really kicks into November. Now, one of the reasons I would say is, I don’t know if everyone does this, but they know I’m not available at the prime time, which is between Thanksgiving and December 1st. That’s a big decorating week. So I can only do so many.
Stephan Shipe: Since it’s already beginning and you’re starting to see all of this, what types of trends are showing up? What types of things do you see for 2025?
Christine Mango: This year you’re seeing a lot of sparkle and gold tinsel trees or champagne trees or silver trees like they used to have in the sixties and seventies. But of course they’re fuller and more modernized and don’t have the color wheel at the bottom going around and around.
Pastels are big this year, like baby blues and mint greens and lavenders. But then you want to add the punch. The house we just did Sunday, Monday we did with a gold tinsel tree that was nine and a half feet tall, and we did all the lavenders and the golds but threw in some darker purples for some punch and color. And same with our ribbon. The ribbon is everything. It’s like lighting at an event. The wired beautiful ribbon is worth the investment. I can’t stress enough, you can’t buy it at your arts and craft stores. I buy it from all sorts of vendors, but there’s only a handful of companies that offer beautiful ribbon that looks like draperies. It just is gorgeous.
Stephan Shipe: Ribbon is not my expertise by any means. So when I look at that thinking, Christine’s going to decorate a house much better than I would be able to if we’re looking at our office trying to put something together. When you think back to all the projects you’ve done, what are some examples that you look back and you say, you and your elves did something no one’s going to pull this off. You have an example of that, or what are those memories?
Christine Mango: I see a lot of TV productions and even these channels that have lots of Christmas movies on them. I look at the decor and go, oh my God. The wire is sticking out. They didn’t even cover the wire. It’s lop sided. Oh my God. I hate to sound critical, but there’s certain tricks. Wiring and taking a strand of lights and plugging it straight into the extension cord. No. You have to hide the cords and get a power strip and you have to use lots of lights. They have to be dispersed evenly.
And I’ve known for my ribbon work. And it’s hard to copy, but I can do some beautiful ribbon work for trees. And so I don’t know if it’s just an elegant look. Like I’ve done whimsical with elves and built ladders going up the trees and had some fun looks.
And I had one with Gene Simmons at his house. His wife and I were invited to a luncheon, mutual friend. And I had done their house and his wife was there and said, who did this house? She said, Christine, she’s sitting right here. So she said, can you come over tomorrow. And so I came within a few days and she had to run out. And so Gene was in the kitchen. I was decorating in the family room, which is a straight shot, and he’s watching. And besides offering me a sandwich and some funny small talk, there were hooks up on the mantle, existing hooks. And I said to him, Gene, are these hooks to hold the garland. And he looks at me and he looks at the ceiling and he goes, the question is, what’s a garland.
And then I dropped an ornament, which rarely happens, but he is staring at me. I was so nervous. And I said, oh, where’s the broom. And he said, you keep asking me these questions that I have no idea how to answer.
Stephan Shipe: That’s why they brought you in!
Christine Mango: Yeah. But I’ve done their home several times and they’ve become good friends.
Stephan Shipe: Here’s the big one then, from the design side, of all your experience, is it a real tree or an artificial tree?
Christine Mango: I prefer a real tree. They’re harder to light. They don’t hold the ornaments. Like an artificial tree can really turn out beautifully because they hold heavy ornaments and they don’t move and they come pre lit and they last all year. Of course, all the trees we put up in October are artificial, but they might look a little better, but I don’t know. If you get a perfect tree and it smells so good and it’s a fresh tree and a lot of people I work with will do both. They’ll have an artificial tree and then I’ll come in and do a fresh tree in another room.
Stephan Shipe: So you come in one day, put it all up or maybe a couple days to put it up. What does the take down process look like?
Christine Mango: A lot of people have their housekeepers take it down or they do it themselves, but I do offer that service. The crew comes in and we will label, put everything away according to each room or a mantle or this is a staircase. We label it so it’s easy to get to the following year. And they keep it. You can use these over and over seven, eight years and they look great, but they start to look shabby after the greens start to dry out from the garlands. And it needs, just like anything, needs to be replaced or refreshed. Lasts a long time. So the fee for install is just a flat fee after the first year.
Stephan Shipe: What should someone expect to spend as a budget? I know that’s a wide range. Someone’s coming in and saying, we want you to come into the main family room or some other areas of the house. What’s a reasonable amount in your mind where you’d look at and say, for a tree, all the decorations, how much would they be spending on the decor portion?
Christine Mango: Well, if they don’t own their tree, that’s the big expensive part. If they get an artificial tree. Because those could be anywhere from 700 to $5000, or it could be a real one, then just a few hundred. But you could spend from a thousand to fifteen thousand, and especially commercial buildings, like some of the hotels, they’ll spend, it’s a good nice chunk of money. But again, it’s a one time investment and then the next year is just an install. A lot easier. And I could work within any budget. Somebody tells me I only have a thousand dollars. I’ll make it work for materials. A thousand dollars.
Stephan Shipe: Well leave us with this as we wrap up here. One or two big tips. If I’m having to decorate a house, what do I need to know. You’ve already given me tips on the ribbon. I need to up my ribbon game and I need to hide the cords. What else do I need to know?
Christine Mango: Stay away from arts and craft store garlands, the thin plasticky cheap looking garlands. Invest in a nice, you can find them online at certain stores, nice full pre lit garlands. If you can’t find those, go with the real garland. You can get it at your tree lot, might have to replace it if you do it too soon, but if you keep it moist and soak it beforehand, it’ll last several weeks.
And one thing I see a lot of people do is decorate in one corner or one section. They put their tree there and then they have their mantle right next to it. Try to spread it out throughout the room and make sure you put your tree in the room that you spend in the most with your family so you can enjoy it.
Stephan Shipe: Literally spreading the holiday cheer. That’s great. Thank you so much, Christine, for being on today and sharing this with us.
Christine Mango: Great. Well happy holidays.
Outro
Stephan Shipe: That’s our show. Thanks for listening, and we’ll see you next week.
Like how we think about wealth? You can learn more about our approach at scholaradvising.com, where we work with high net worth families on personalized planning and strategy.
Disclaimer: The information provided in this podcast is for general informational and educational purposes only, and is not intended to constitute financial, investment, or other professional advice. The opinions expressed are those of the hosts and guests and do not necessarily reflect the views of any affiliated organizations. Investing in financial markets involves risk, including the potential loss of principal. Past performance is not indicative of future results. Before making any investment decisions, you should consult with a qualified financial advisor who can assess your individual financial situation, objectives, and risk tolerance.