CashLamp

Personal Finance for Expats

Some Reasons to Invest Offshore

Posted on Written by

When discussing the topic of investing offshore with friends, family, colleagues, and acquaintances, the question of “why invest offshore?” invariably comes up.

In my mind, there are a myriad of reasons to invest offshore, but here are some of my favorite ones:

Increased privacy – Protect yourself from the increasing loss of privacy, and prevent domestic credit reporting bureaus from collecting information on you and your assets. Many offshore financial centers have strict banking and confidentiality laws. As long as one is not engaging in arms trafficking, money laundering, or other illegal activities, investing offshore will better enable you to protect your privacy.

Earn higher returns – Offshore funds may have more freedom in terms of what they can invest in, whether they go long or short, as well as more freedom to take advantage of market fluctuations and cyclical movements. As a result, you have the potential to earn higher returns than you could in your country of residence, where there is probably more regulation and red-tape, and where fund managers might be restricted as to the investments they are allowed to make.

Avoid high taxes – Depending on your citizenship and where you reside, many low-tax districts can offer you products that have little or no tax at source. In addition to this, by forming an offshore corporation or trust, you can potentially lower your tax burden.

Protect your assets from being forfeited – Many offshore financial centers are not required to accept the laws or civil judgments of a foreign government. By creating a foreign corporation and/or trust, you can prevent your assets from being seized by our government and/or lenders who want to collect on outstanding debts. As societies are becoming more and more litigious, it is a good idea to invest offshore so you can protect yourself against any potential lawsuits that may occur in your country of residence.

Avoid having to depend on a state pension – Even if you live in a country that offers a state pension, it is doubtful that a state pension alone will provide you with the money to have a quality retirement. With an aging workforce, diminishing returns, and fewer workers to contribute into state pensions, depending entirely on such a vehicle to provide you with a quality retirement is not the best idea.

While there are risks associated with investing offshore, and there may be increased complexity when managing an offshore portfolio (not to mention tax implications), I believe the benefits are too tantalizing to ignore. Also, there are risks even when one invests in familiar investment vehicles in their home country. There’s no way to completely eliminate risk, but with the right strategy and right knowledge, in addition to the correct team of advisors (financial and tax), one can reap huge benefits investing offshore.

The Need for an Expat Personal Finance Blog

Posted on Written by

Despite what many people may think of us and the seemingly lavish lifestyles we are supposed to be living, we expats are a neglected lot, especially when it comes to obtaining good, relevant, and free (or cheap) advice on personal finance.

Performing a search for “personal finance for expats” online provides precious little that we can use. There is certainly not, at least that I have found, a knowledge base in a blog format where expatriates can go to read up on personal finance as it relates specifically to them.

Finally, advice such as “invest in an index fund” seems insulting to our intelligence, given that we probably could have figured that out by ourselves, and more importantly, because it ignores the array of investment options around the world. Indeed, there are numerous investments out there that many people have never heard of of, and we would be doing ourselves a disservice by not exploring and investigating what those options are. Because just as life as an expat requires flexibility, an open mind, courage, and an inquisitive mindset, investing as an expat requires those same qualities if one intends to be successful at developing a solid financial future.

Perhaps you work at an overseas office of your company, and are looking for ways to save for your retirement, as you are not very happy with the state pension plan of the country you live in.

Or perhaps you have started your own business and are now living overseas. You are excited but also apprehensive about this change in your life, and are worried about how you can invest money, now that you are living overseas.

Or maybe you are a perpetual traveler, sailing the seas of the world, climbing the tallest peaks known to humankind, or hopping from one island to another, taking in all that life has to offer.

Whatever your situation is as an expat, if you are interested in saving and investing, then this blog will be useful and applicable to you and your situation.

Many personal finance bloggers and experts seem to be writing from a position where they cannot truly understand the situation facing us expatriates. While I am not a financial planner and don’t claim to know everything, I am writing to you as a humble expat who has lived and worked on three different continents, and someone who has first-hand experience of the challenges faced by expats. Additionally, being a tax advisor specifically serving the expat market, I believe I am positioned to offer advice to other expatriates, especially as it relates to foreign taxation and its various implications.

Throughout my life and travels, I have found that many expatriates have little or no idea how or where they can save and invest money overseas. This blog is intended for them.

Copyright © 2019 Quantage, LLC