Have you ever wondered why anyone would bother to open an offshore bank account? While it’s not a common practice, there are actually several different reasons why you should consider opening an offshore bank account.
Here are some of the most common reasons to open an offshore bank account:
- Many foreign banking systems are much healthier – Singapore has literally never had a bank failure. A great many banks in the Middle East are actually quite well capitalized and hold higher quality assets than most North American banks.
- Foreign bank accounts often pay more interest – Interest rates in North America are at an all time low, but you can still get decent interest payments in other parts of the world. It isn’t unheard of to get interest rates as high as 13.5% just for having money in your account.
- Currency diversification – Holding money in multiple currencies protects your purchasing power and internationalizes some of your savings. It can also be a great way to diversify your portfolio, as many offshore banking accounts also allow you to participate in foreign stock exchanges.
- Foreign banks are often more innovative – Foreign banks are pushing the limits of banking with new innovation all the time because they aren’t bogged down by the same level of intense regulation as most banks in North America.
- Always have access to money – There are a whopping 15 million lawsuits filed in the US every year. A foreign bank account means that you will still have some money if your assets are seized during an investigation. While there’s still a good chance you’ll never have this issue, it’s always good to be prepared.
- Foreign bank accounts give you more freedom – A foreign bank account gives you more options in case something goes wrong at home, whatever that something is. Keeping multiple offshore accounts with enough money to actually stay in the country for a while makes it difficult for anyone to stop you from living the life you want.
Recently it has become more difficult to open an offshore bank account and someday soon it might just be impossible. If you can open an offshore bank account now, even a small one, you might well be glad for it later when the government clamps down on people trying to send money abroad.