Escape Artist
  • Features
    • Interviews
    • News
    • Field Notes
    • Trending
  • Your Escape Plan
    • Finance
    • Real Estate
    • Second Citizenship
    • Events
    • Shop
  • Destinations
    • Europe
      • France
      • Germany
      • Italy
      • Portugal
      • Scandinavia
      • Spain
      • United Kingdom
      • Rest of Europe
    • Central America
      • Belize
      • Costa Rica
      • El Salvador
      • Guatemala
      • Honduras
      • Nicaragua
      • Panama
    • Others
      • Africa
      • Asia
      • Australia
      • North America
      • South America
  • Travel Tips
    • Know Before You Go
    • Packing List
    • Food + Culture
    • Health + Wellness
  • Subscribe
Escape Artist
  • Features
    • Interviews
    • News
    • Field Notes
    • Trending
  • Your Escape Plan
    • Finance
    • Real Estate
    • Second Citizenship
    • Events
    • Shop
  • Destinations
    • Europe
      • France
      • Germany
      • Italy
      • Portugal
      • Scandinavia
      • Spain
      • United Kingdom
      • Rest of Europe
    • Central America
      • Belize
      • Costa Rica
      • El Salvador
      • Guatemala
      • Honduras
      • Nicaragua
      • Panama
    • Others
      • Africa
      • Asia
      • Australia
      • North America
      • South America
  • Travel Tips
    • Know Before You Go
    • Packing List
    • Food + Culture
    • Health + Wellness
  • Subscribe
👤

THE NUMBER ONE SOURCE FOR EXPATS, DIGITAL NOMADS, AND DREAMERS.

This field is for validation purposes and should be left unchanged.
  • Finance

Understanding Offshore Pension Plans

  • BY Don Halbert
  • February 9, 2014
Total
0
Shares
0
0
0

Understanding Offshore Pension Plans

As an expat, it’s possible that you’ve been approached by someone about an offshore pension plan either by phone or email.  These plans are also known as unit-linked life insurance plans.  They’ll claim that they can substantially improve your financial situation.  Should you be considering this as an option?

 

What is an offshore pension plan?

Offshore pension plans are basically a combo of insurance with an investment strategy.  Part of your money will go to the life insurance policy premium while the rest is invested in other equities.  Once your money, along with many others, is collected, the insurance company will create a fund pool to invest in various markets, similar to a mutual fund.

Features include the ability to switch between funds during the policy, top-up facilities, changing the level of protection, extra riders to increase returns, options to surrender, and tax benefits.

 

What does an offshore pension plan cost?

This will vary greatly depending on the options and coverage you choose.  Of course, according to most plans’ marketing material, you’ll get great returns and they say that it only needs to grow .4% to break even.  However, this doesn’t include any fees paid into the plan, any external charges, or take into account any problems with the plan, like missing a payment.  Some of the plans even promise bonuses that will credit money back into account.  While these seem lucrative, they mostly serve as a distraction from the enormous fees that the funds take.

To get an idea of the charges that will be accrued, take a look at the terms and conditions of the contract.  This will outline the fees and commissions that will be taken from the account.  As a word of warning:  your agent will receive a large bonus – called an “override” – for signing you up on this plan, hence why they can try to oversell you on them.

From the beginning, your contributions will be “locked up” until the end of the term.  The problem is that since the commissions and fees are paid upfront, the surrender fee winds up being larger than any earnings. And even if the trust is based in a tax haven, your policy will be taxed based on where you are a resident.

 

Should I invest in an offshore pension plan?

In short, probably not.  BBC recently did an investigation on these kinds of pension plans and found that even though the agents claimed pension fees were only 1.5%, they often wound up costing almost 80% of the investor’s contributions.

If you’re looking to invest while living abroad, always stick with a cost-efficient and simple plan, not something that someone has to sell you on.

Here is probably the most extensive ebook on Everything You Ever Wanted To Know About Eliminating Your Taxes, Protecting Your Assets And Regaining Privacy Over Your Life And Investments. It is called The Ultimate Guide To Going Offshore.  

I hope you enjoyed reading this article: Understanding Offshore Pension Plans. If you have any questions, please contact our office HERE.

I’ve included some great articles for you to read, enjoy!

When Things Go Wrong: Healthcare Abroad in the EU

How to Secure Your Financial Data

An Offshore Haven For Crashing Hong Kong Investors

 

If you’re considering traveling or moving abroad, be sure to explore your healthcare options. Visit International Citizens Insurance to learn more and get a free quote.

Total
0
Shares
Share 0
Tweet 0
Pin it 0
Related Topics
  • insurance
  • investment
  • offshore
  • pension plan
Previous Article
  • Your Escape Plan

5 Ways Vacation Improves Kids Health

  • BY EA Editors
  • November 9, 2013
View Post
Next Article
  • Food + Culture

Typical Food In Paraguay

  • BY EA Editors
  • September 11, 2014
View Post
You May Also Like
The Tale of the Tael - A timeless store of value across centuries
View Post
  • Finance
The Tale of the Tael’s: A Hard Lesson about Hard Money
  • BY Michael Checkan
  • September 24, 2025
Craggy cliffs and quiet harbors frame life in the Isle of Man
View Post
  • Your Escape Plan
Life and Opportunity on the Isle of Man
  • BY Aneesa Marufu
  • September 19, 2025
Central America’s strategic position is reshaping the global offshore banking map
View Post
  • Plan B
The Future of Global Finance Runs Through Central America
  • BY Luigi Wewege
  • September 17, 2025
Global Diversification Tips from Experts
View Post
  • Plan B
Staying in One Country Could Be Your Biggest Financial Risk
  • BY Isha Sesay
  • September 3, 2025
Low-Tax Countries to Save Money in 2025
View Post
  • Plan B
Where Expats Are Moving to Keep More of Their Money
  • BY EA Editorial Staff
  • August 27, 2025
Belize Offshore Banking
View Post
  • Plan B
Why Belize’s Waters Run Deep in Offshore Banking
  • BY Luigi Wewege
  • August 20, 2025
International Banking Structures
View Post
  • Plan B
Tax-Friendly Banking Solutions for International Investors
  • BY EA Editorial Staff
  • August 13, 2025
View Post
  • Interviews
Meet the Legal Strategist Guiding Portugal’s New Wave of Expats
  • BY Isha Sesay
  • July 19, 2025
Trending Posts
  • 1
    • Mexico
    Top 10 Things to Know if You’re Moving to Mexico
    • September 26, 2025
  • The Tale of the Tael - A timeless store of value across centuries 2
    • Finance
    The Tale of the Tael’s: A Hard Lesson about Hard Money
    • September 24, 2025
  • Hungarian Citizenship by Descent Journey from Amercia 3
    • Second Citizenship
    Our Journey from America to Hungarian Citizenship
    • October 1, 2025
  • Abkhazia jewel of Soviet summer escapes 4
    • Field Notes
    Secrets of the Soviet Riviera
    • October 3, 2025
  • Summer in Lapland: Lapland’s wild landscapes glow under the endless Arctic sun 5
    • Field Notes
    Before the Snow Falls in Lapland
    • September 29, 2025
InterNations
Know Before You Go
  • Expat Child Syndrome 1
    • Wellness
    The Untold Story of Expat Kids
    • October 6, 2025
  • Abkhazia jewel of Soviet summer escapes 2
    • Field Notes
    Secrets of the Soviet Riviera
    • October 3, 2025
  • Hungarian Citizenship by Descent Journey from Amercia 3
    • Second Citizenship
    Our Journey from America to Hungarian Citizenship
    • October 1, 2025
  • Summer in Lapland: Lapland’s wild landscapes glow under the endless Arctic sun 4
    • Field Notes
    Before the Snow Falls in Lapland
    • September 29, 2025
  • 5
    • Mexico
    Top 10 Things to Know if You’re Moving to Mexico
    • September 26, 2025
Learn More
  • About us
  • Contact
  • Advertise
  • Subscribe
Why Subscribe

The newly imagined Escape Artist brings you fresh content with a global focus, and sharp, up-to-the-minute coverage of the joys, challenges, and opportunities of life abroad.

For a limited time, we’re offering a special discount on all subscription deals, so be sure to lock-in these incredible savings and start receiving top-notch travel and expat content today!

Sign up for the EA Newsletter

Get important news delivered directly to your inbox and stay connected!

This field is for validation purposes and should be left unchanged.
Escape Artist
  • Terms & Conditions
  • Privacy Policy
  • Cookies Policy
  • Disclaimer

Input your search keywords and press Enter.

Newsletter Subscription
Our Spring Sale Has Started

You can see how this popup was set up in our step-by-step guide: https://wppopupmaker.com/guides/auto-opening-announcement-popups/