This post was written in part by Infinity Financial Solutions.
As a general rule, expats in Malaysia make a substantial amount of money to be able to set some aside in their life savings, or for retirement. It’s a fact that life gets more expensive every year, so trying to ensure your savings grow with you and do not depreciate is highly crucial in these uncertain times.
Too often, we do not have enough time or expertise to ensure our savings are sufficient enough for a long-term plan. That’s where financial planners come in to provide the kind of expertise the average individual lacks, or does not have the time to learn . The question then arises of who to trust, especially when we hear stories of financial planners who only have one objective in mind, which is to get your investment, and place it where they can earn the highest commissions.
Apart from that, being restricted in where you save your money is a very undesirable and unwanted worry to have being an expat in a foreign country. This is where international bank accounts or for the lack of a better term, offshore accounts come in.
The term offshore can conjure up images of corrupt politicians hiding funds away, or billionaires sheltering cash to avoid paying taxes. In fact, many banks now prefer to use the term international bank accounts to get away from this negative connotation. The reality is, that the vast majority of offshore bank accounts are held by people just like you or me who simply need a practical solution for storing liquid assets for entirely legitimate reasons. An offshore bank account is an account which is held in a different jurisdiction to the one the account holder lives in, nothing more sinister than that!
Infinity Financial Solutions have been advising their clients around Asia since 2004, and have built up a trustworthy reputation. They cover all the areas that you need to consider for complete financial security as you focus your efforts on building your career and dreams for your future. These include basic things like ensuring you have proper medical and life insurance as well as creating structured investment plans to protect your savings. Their services also extend to ensuring you maintain a satisfactory income should you find yourself without employment for whatever reason. This has become increasingly important as so many people change jobs quite often, it’s proven to be a challenge to vest in one company’s pension plan. And undoubtedly, most people struggle to make ends meet when they find themselves in such a situation.
These are just a few of the many reasons why individuals might opt for an international or offshore account. One reason is tax efficiency, with another being security. For those living in certain countries, economic or political instability might mean that it is prudent to keep a minimum amount of cash in that country’s banking system to cover day-to-day expenses while protecting excess cash in a safer jurisdiction. In addition, spreading liquid savings across different countries can certainly diversify risk and exposure to currency fluctuations.
Although these are all valid reasons, nevertheless, one would argue that flexibility and convenience are reasons why most expats opt for an offshore account. Being able to make withdrawals in a variety of currencies can be a practical solution for many expats particularly those that travel widely with work, and those who relocate on a regular basis. Offshore accounts also work well for those earning in a different currency to where they originate from, or for those who have debts in their country but earn in another. A prime example being the many expats living in Asia who are paying off mortgages on properties back home.
In recent years, onerous reporting standards have made it increasingly difficult for expats to open offshore accounts. Since 2014 FATCA in particular has caused a huge headache for many of the estimated 6 million Americans living abroad with certain banks choosing to close their doors to American clients rather than having to deal with the obligatory regulations and compliances. To give one example, the president of the French banking association earlier this year warned that French banks may be forced to close down 40,000 accounts of so-called ‘accidental’ Americans before the end of 2019 when the period of grace granted to the country for IRS reporting comes to an end.
It’s not just FATCA though. As the fight against corruption, bribery and money laundering ramps up, Know Your Customer (KYC) requirements aimed at tackling these issues are being introduced by regulatory bodies in many countries around the world. KYC is the term used to describe the due diligence process of identifying and verifying the identity of clients as well as putting in place internal controls and monitoring systems. It is why scrutiny has increased on transactions such as the opening of new bank accounts and international currency transfers.
If you are experiencing difficulties in getting assistance with opening an offshore account, Infinity may very well be the solution you are looking for. Their close relationships with a number of banks around the world are essential to garnering the right kind of trust needed, on top of the knowledge and expertise required to help you with everything you need for opening your own offshore account. Their consultants are up-to-date with current onboarding compliance requirements and will willingly help simplify the process for you.
If you are using a financial planner, you should ensure they are properly licenced to do business in Malaysia because sadly, there are a number of rogue operators who will take advantage of your lack of knowledge. Having been in the business of giving advice to expats around Asia for a good number of years, Infinity Financial Solutions have built up a reputation of succinct reliability.
Click here to find out how you can open an international bank account.