Episode 8: Should You Invest Internationally? Lessons from the Global Diversification Debate

lawyerfipodcast
Oct 13
3 min read

When it comes to investing, one of the most debated questions is whether you should keep your portfolio entirely in U.S. companies—or look beyond America’s borders for growth.

In the latest episode of the LawyerFi Podcast, host Adam B. Cordover dives deep into the world of total international stock index funds, breaking down what they are, why they matter, and how they fit into a long-term financial independence strategy.

What Are Total International Stock Index Funds?

Total international stock index funds give investors access to thousands of companies outside the United States—spanning both developed and emerging markets. These funds, such as Vanguard’s Total International Stock Index Fund (VXUS) or Fidelity’s FTIPX, are designed to mirror the global economy and diversify your investment exposure.

In this episode, Adam examines whether adding these funds to your portfolio makes sense, especially for investors who already hold U.S. index funds like the S&P 500 (VOO) or Total U.S. Stock Market (VTI).

The Global Diversification Debate

To unpack this question, Adam draws insights from some of the most respected voices in the investing community—Jack Bogle, JL Collins, Rick Ferri, Jim Dahle, and Paul Merriman.

Jack Bogle himself often argued that U.S. investors didn’t need international exposure, given the global reach of American corporations. But others, like JL Collins and Rick Ferri, make a strong case for global diversification, pointing to historical periods where international markets have outperformed.

One striking lesson Adam shares comes from Japan’s “Lost Decades.” Once a booming economy, Japan’s stock market crashed in the 1990s and still hasn’t fully recovered—reminding investors that no single country’s dominance is guaranteed forever.

Different Portfolio Approaches

Adam breaks down several allocation strategies, including:

100% U.S. Allocation – Simple, efficient, and historically strong returns.
Blended Approach (70/30 U.S./International) – Adds diversification without overcomplicating your portfolio.
Global Allocation (Total World Funds) – Funds like Vanguard’s VT combine both U.S. and international stocks in one easy investment.

Each approach has its pros and cons. For example, Total World Funds simplify diversification but may increase foreign tax complexities. Meanwhile, investors who choose separate U.S. and international funds can fine-tune their allocations—but must rebalance more actively.

Building a Globally Diversified Portfolio

If you follow the Bogleheads Three-Fund Portfolio, you’re already halfway there. This classic investing framework includes:

A Total U.S. Stock Index Fund
A Total International Stock Index Fund
A Total U.S. Bond Index Fund

This simple, low-cost, and globally diversified setup has stood the test of time—and remains one of the easiest ways to invest smartly and stay disciplined.

Don’t Forget the Tax Angle

Adam also explores the tax implications of investing internationally. Funds that hold foreign companies may qualify for a Foreign Tax Credit (IRS Pub. 514), which can offset some of the taxes paid to foreign governments. It’s an important consideration for any globally minded investor.

Tune In & Take Control of Your Financial Future

Whether you’re an experienced investor or just starting your journey toward financial independence, this episode will help you make more informed, confident decisions about your portfolio’s global mix.

Listen now on the LawyerFi Podcast and discover how a disciplined, well-diversified strategy can strengthen your financial future.

Show Notes & Resources:

LawyerFi Podcast is hosted by Adam B. Cordover, a Florida-based Collaborative Family Law Attorney. Through Family Diplomacy: A Collaborative Law Firm, Adam helps professionals across Florida resolve divorce and family matters privately and respectfully—without going to court.

Offices by appointment in Tampa, St. Petersburg, and Sarasota

Call 813-443-0615 or visit familydiplomacy.com to schedule a confidential virtual planning meeting.