Unconventional Asset Protection Strategies: Different Ways Offshore Accounts Can Help
Overseas banks, in some cases, have developed a bad reputation for being situated in countries that are thought of as tax havens. Those who’re unaware of how these banks operate are under the impression that these institutions simply exist for people who’re looking to defraud their governments and hiding their true income in order to evade taxes.
However, as more people get educated on the subject, the image of these institutions is improving and people are now beginning to see them as legitimate and safe entities.
There are plenty of benefits to opening bank accounts overseas; asset protection being the primary one. Opening a bank account in a foreign country can secure your money and keep it from being accessed by local courts.
Businessmen across the globe use these accounts to carry out international transactions. Investors have plenty of more business opportunities which they may not have had previously. EU residents and Americans that are unhappy with the rates offered in their local banks can enjoy the high returns of offshore banking.
What Offshore Banks Accept US Clients?
You’ll need to do some research to find out which banks are open to doing business with US clients. The US laws demand that foreign banks working with their citizens provide consistent reporting. But even with all the extra procedures, there are overseas banks that are willing to accept American clients.
Whenever you do decide on a bank, don’t wait too long to open an account just in case you’re hit with a lawsuit or a judge is looking into your assets.
What Does Offshore Banking Entail?
When you set up a bank account overseas, it is often referred to as offshore banking. An offshore bank is any bank that’s situated outside the depositor’s country of citizenship. Due to the secrecy that encompasses these banks, they’ve earned a dubious reputation.
As more people learn about offshore banking, it’s now being used by everyone. From wealthy businessmen to expats who move around frequently, offshore banking is being used by everyone today.
Asset Protection Benefits of Banks Overseas
There was a time when offshore banks were notorious for having drug dealers and money launderers for clients. Of course, not all offshore accounts are owned by criminals but that is definitely what some government agencies want you to think.
Due to terrorism and drug trafficking, the banking industry has had to implement various checks and balances to ensure that they aren’t being used for criminal activity. Financial institutions all over the globe have agreed to be more transparent. If suspicious activities do happen, it’s understood that these institutions will cooperate fully. Because of these added measures, the transactions in these banks aren’t as discrete as they used to be.
Offshore Banking + Asset Protection Trust
The increased transparency of offshore banks has not affected their ability to protect your assets. Although the sharing of information has made it difficult to conceal assets that are stored in foreign financial institutions, it still doesn’t give other governments access to your accounts. Your country’s laws do not apply to your offshore accounts.
If you’re ever in a situation where a judge tells you to bring your money back, the foreign bank should provide you with protection.
With your assets in an overseas bank and overseas legal tools, creditors that are out for your money will be forced to follow foreign laws. If they do want to take your money from you, they’ll have to begin a long and expensive process.
Offshore accounts have many more layers of protection which makes them more secure.
Here’s a great article on Why You Need A Second Passport
Advantages of Offshore Accounts
Businesses that deal with international clients benefit greatly with offshore accounts. Offshore banks offer payroll services for organizations that have suppliers and staff in multiple countries. The international exchange of goods is incredibly costly. However, many foreign banks provide special services to such businesses allowing them to carry out transactions at a lower cost.
Offshore accounts don’t just benefit businesses with international transactions; they offer numerous growth opportunities for local businesses too. If an opportunity does present itself, it will be easier for you to take advantage of it; seasoned businessmen know the importance of jumping on opportunities faster than their competition.
Divide and Conquer
Keeping your personal assets far from your business assets will ensure that creditors can’t access them. A creditor may find their way to your business assets, but your personal assets will remain secure.
If the creditor is determined to get your personal assets, they’ll have to file a different case. Setting up an LLC in a friendly jurisdiction will allow you to store your business assets in an offshore account and provide you with an extra layer of protection.
Offshore Banking and Additional Income Opportunities
A diversified portfolio allows you to withstand any fluctuations in the business environment. Depositors can access international investment opportunities through offshore banking. This is especially true for places like Singapore and Switzerland that are considered financial centers. An offshore bank account serves as a gateway to investment opportunities that boost your income in the long-run.
Best Location for Offshore Banking
Each location comes with its pros and cons when it comes to offshore banking. The location you choose will depend on your needs. That being said, some places do provide more protection than others. When you’re searching for the best offshore bank for your needs, make sure that the country you’re considering is politically stable.
Both, European and Asian banks are a great option to set up an offshore account. Politically neutral countries like Switzerland and Hong Kong are also good choices.
If you’re ready to retire, you might want to look at Chile. Here is a fabulous article on the benefits of living in Chile.
For more information on asset protection, offshore banking, offshore incorporations and offshore gold and silver storage, check out Expat Money Show’s podcasts. In our podcasts, we provide entrepreneurs with all the knowledge they need to grow their wealth by taking advantage of overseas financial institutions.
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About The Author
Mikkel Thorup is the host of The Expat Money Show podcast and the author of #1 Best-Selling book Expat Secrets on Amazon. He has spent nearly 20 years in continual travel around the world, visiting more than 100 countries including Colombia, North Korea, Zimbabwe, and Iran.
His goal is to help Expats like you to generate additional streams of income, eliminate your tax bill, and take advantage of offshore structures so you can travel the world freely and never have to worry about money again. For more information on his legal (but creative) tax strategies for Expats watch this free video.