Why Entrepreneurs Should Look At Offshore Banking

Global diversification is a great move for your investment portfolio, but you might want to start with a savings account in your home country before venturing offshore for greater investment or lending.  However, entrepreneurs should consider establishing an offshore savings account instead. It is important that you know what the benefits of an offshore savings account will be before you make any decisions.

Better Interest Rates

Perhaps your startup has now scaled or you’ve had a nice exit. If you have a substantial amount of cash that you want to protect in your savings account, offshore options will generally provide you with a better interest rate.  There are many situations where you will have better interest rates while you save more money.  An example of this will be an offshore savings account which offers 0.10% APR on a balance of $25,000 and 0.25% APR on a balance of more than $50,000.  These accounts will generally offer a better rate of 0.50% APR if you have more than $100,000.

By getting an offshore savings account, you will not only continue to save, you will be able to watch your net worth increase without any of the risks of investing.  

Lower Overhead Fees

A savings account can have a range of different fees from monthly usage fees to application fees to management fees.  While this might seem unavoidable, you can choose a bank with lower fees to help you save all of your money. It is important to note that bank fees vary greatly, but the best way to find lower fees will be to look at offshore destinations where the cost of living and general overhead will be lower.  The clear winners for this will be Belize and other Latin American countries.

Greater Diversification Of Assets

Entrepreneurs already take a lot of risks. If you have all of your investments and savings on one currency in one geographic location, you might want to think about the saying of not keeping all of your eggs in one basket.  When you open an offshore savings account, you will actively reduce the risk you face. If one banking system was to fail or there is government intervention, you will always have an offshore safety net to fall back on. The best wealth management firms in London can be a big help.

Ideal For Expatriates

If you are going to move abroad for work or are thinking of retiring in an international destination, you need to consider getting a savings account in the country that you are going to be moving to.  If you ever need to withdraw money from the account, it would be easier due to your proximity. You will also never have to worry about costly currency conversions.

The Potential For A Lower Tax Burden

One of the biggest benefits that can come from the creation of an offshore saving account is the reduction in your tax burden.  When you keep a large portion of your taxable assets offshore in a tax-friendly jurisdiction, you will lower the amount you have to pay annually.  It is important to note that this is a completely legal banking maneuver that will protect your money and help you maintain your wealth.

There are a lot of reasons why entrepreneurs should look at establishing an offshore savings account.  These are just a few of them and will help you understand why so many investors do this.