Best Offshore Banking Accounts
There are still many people today who mistakenly associate offshore banking accounts with less than legal activity. In truth however, having an offshore or foreign banking account is a simple and straightforward matter. It is simply a bank account that you maintain in a financial institution that is not located in the country where you reside. It doesn’t even have to be on an island or offshore, which is another common misconception. Switzerland and Liechtenstein are both excellent ‘offshore’ banking locations and they are nowhere near an ocean or sea.
In the current world economy, having an offshore banking account is almost the rule rather than the exception. This is partly because of online banking. That can make maintaining a bank account in a foreign country almost as simple as putting your money in the bank down the road.
There are various reasons having an offshore bank account can be useful. If you’re a successful professional looking for a way to protect your assets, an offshore bank account can help you do that. It can also facilitate business transactions if you own a business with international operations. Even if you’re just an average bloke trying to find a way to make your money work harder for you the legal way, opening an offshore bank account can help.
Before you decide where to open your offshore banking account, do your homework. Read this beginners guide to offshore banking. Choose a location that is politically stable, has a conservative approach to investments and loans, and conducts a fair amount of local business.
Is Offshore Banking Safe?
Don’t take our word for it. Take the word of Global Finance that ranks banks for safety. The publish an annual list of the world’s 50 safest banks. In their most recent list, as of this writing guess how many U.S. banks made the top 50? Would you guess 47? 40? How about three. Yes, just 3. All three were on the bottom half of the list. There was only one major U.S. bank on the list (US Bancorp, at number 41). The other two were small regional farming banks (AgriBank and CoBank at numbers 33 and 48). So, the question is not “Is offshore banking safe?” The question is, “Is U.S. banking safe?” There are many more safe banks outside of the U.S. than inside.
Asset Protection Features
There is no single asset protection vehicle that can secure all your assets from frivolous lawsuits all the time. With the ever-expanding notion of liability, especially in U.S. courts, protecting your assets requires not only vigilance but diversification as well. Depending on your particular situation, including an offshore bank account in your asset protection plan may prove to be advantageous. You can house the account within a limited liability company (LLC) and/or an asset protection trust to keep it even more secure.
A stand-alone offshore banking account not an effective enough a lawsuit deterrent. Otherwise a local judge could order you to bring the funds back. When the brown stuff hits the circulatory device, the account needs to be held by an asset protection tool. When a legal asset protection structure ties the hands of the judiciary, then you have true protection.
Sadly, in today’s litigious society, you can be sued for just about any reason. Sometimes, you can be sued for really no legitimate reason at all. Plaintiffs who are looking for an easy mark with deep pockets know that getting their hands on an offshore banking account will take some time and extra legal steps. Rather than go through the trouble, they simply look for an easier target. The more difficult you make it for predatory creditors or plaintiffs to get to your assets, the less attractive and ultimately, safer, they will be.
Excellent Tool for a Global Business
More than 50 years ago, a Canadian professor named Marshall McLuhan coined a phrase that accurately describes the kind of world we live in today. He wrote that the world was fast becoming a ‘global village.’ People from the far reaches of the planet are as connected to one another as if they lived right next door to each other. McLuhan credited this sense of connectedness to the modern means of communication at that time. Keep in mind this was five decades before the creation of the internet and the birth of social media.
The current version of this global village is even more advanced than McLuhan experienced or imagined. Today, business and personal connections are made in quite literally a keystroke. They are measured in parts of a second rather than in minutes. In such a scenario, if you have a business with an international reach, it makes perfect sense to have an offshore banking account. Or, perhaps your business does not yet operate internationally but you’re gearing up to take that leap. Opening an offshore banking account can help you take your business to the next level. An offshore banking account facilitates money transfers from your local business account to your offshore account and vice-versa.
Having some of your business funds in an offshore banking account can also insulate your business from unforeseen developments. If conditions in your home country make it difficult for you to access funds in your local bank, the assets in your offshore bank account will still be available for you to tap. Business can go on as usual – or as close to it as possible.
Unique Investment Opportunities
Even if you don’t own an international business, having an offshore banking account can still generate an income for you. Savvy investors know that offshore banks often have access to investment opportunities that are not available elsewhere. This is especially true in bustling international financial hubs like Hong Kong and Singapore. These unique investment and diversified funds options often result in better yields. This is partly the reason most offshore banks can afford to give higher interest rates. Let’s face it. U.S. interest rates have been at consistently dismal levels for several years now. You actually lose purchasing power the longer you keep your money in an ordinary U.S. savings account. This will be so for as long as the interest rate your bank gives you remains below current inflation levels.
On the other hand, the money in your offshore banking account will quietly gain interest year after year. In essence, your money ‘works’ harder for you and doesn’t lose any of its purchasing power. All you have to do is watch it grow – albeit, from a distance.
It seems just about anywhere you turn in the world today, you run into some kind of political turmoil. If your home country is going through a tough political patch at the moment, it makes sense to open an offshore banking account in a more stable location. But you should considering having an offshore account anyway, even if there is currently no political strife where you live. It can become extremely difficult to move money out of a country when a political upheaval erupts. The powers-that-be will rush to secure the country’s physical and fiscal borders. You may find your assets frozen quite literally overnight.
Although you may not realize it, your money could be in jeopardy even in a politically stable country like America or even Canada. The federal government can enforce a monetary policy that unexpectedly threatens the security of your assets. Or, a Lehman-style meltdown can happen again and the bailout may negatively affect the assets you currently hold. Diversification, whether in investing, banking or asset protection, is always a sound and prudent decision. Putting all your eggs in one basket is an almost guaranteed way of getting some, or all, of them broken. Secure the added protection of an offshore banking account for your money. It’s not at all difficult or complicated to set one up. Some countries, like Panama, even let you open an offshore bank account online for free.
Where Bank Offshore
The country or jurisdiction where you will eventually open your offshore banking account depends on your personal and financial goals. If using a bank that’s located halfway around the world makes you feel uncomfortable, choose one that’s closer to home. If banks in a small island nation make you apprehensive, choose a bank in a larger country. Switzerland comes to mind. Assess the level of risk you are comfortable with and use that as a baseline guide.
That said, opt for an offshore bank that does a considerable amount of local business. Banks with deep ties to a location or community are less likely to bolt in the wake of a financial or political crisis. Additionally, find a bank governed by conservative fiscal policies; one that is also highly liquid with a varied investment portfolio. No matter where you open your offshore account, do your homework before you turn over your money. That is where getting an expert to help you really makes sense. After all, it’s your money.
In full disclosure, this is a service that this organization provides. There is a number and form on this page in order to have a conversation with a real person who has extensive experience in this arena.
Having an offshore banking account is completely legal, and for a number of reasons, often an astute decision as well. It can facilitate international transactions for your business or simply for travel. In certain circumstances, just having an offshore banking account could be enough to deter lawsuits. Additionally, many foreign banks currently offer higher interest rates than their U.S. counterparts. This means your money earns more over time and you get the pleasure of watching your money grow with very little added effort on your end.
Plus, many offshore banks provide stock brokerage services. So you can not only park your money in a safe international institution, you can also make it grow through sound investments.
Open your offshore bank account in a country or jurisdiction with conservative banking policies and in a bank with a considerable amount of local clients. The first means they won’t not play fast and loose with your money; your account will tend to be more secure. The second means they are are likely to be around for years to com, even if a political or financial crisis suddenly erupts.
There will always be risks no matter where you decide to place your money. In a global village, business, the rules of economics, government regulations and other such factors are intricately intertwined. In the final analysis, the best country for your offshore banking account is the country that meets most, if not all, of your professional and personal requirements. It’s your money and you worked hard for it. Choose an offshore location that will not only protect your money but make it work harder for you as well.
Last Updated on October 1, 2019