We are finally trying to save more than we spend to stave off financial meltdown, as a result better paying offshore savings accounts are becoming fashionable
Well, it was only a matter of time before the time bomb that was the UK economy imploded and Brits realised that they couldn’t live off the fantasy of property based equity forever. Unfortunately the implosion has been devastatingly catastrophic, and thanks to the government compounding the situation with bank bailouts, the average British household is now so far in debt it’s not funny.
This debt is an unattractive legacy that will be passed on to our children unless we learn how to pay back the loans, pay off the credit cards and save for a rainy day rather than trying to live way beyond our means just because the value of our home is rising – on paper at least.
Thankfully both Britons living onshore and those who have expatriated to escape the mess that is the UK’s balance sheet have realised the value of saving, and offshore saving accounts have suddenly become very fashionable, so much so that they have even been researched and written about in the popular financial press.
In a recent article, LoveMoney.com compared the advantages and disadvantages of offshore and onshore savings accounts. They highlighted the potential risks and rewards associated with both the onshore savings accounts and the offshore alternatives, which are of course available to expatriates and British residents alike. Note, if you do offshore your money and you’re tax resident in the UK, you have an obligation to declare your offshore financial assets to HMRC. The article came out in favour of onshore accounts for onshore Brits, despite the offshore savings accounts offering higher rates of interest.
We would say that as everyone’s savings objectives are different, because everyone’s risk profile is different and because we are all individuals, take professional advice before you select a savings account. What’s more, expats should certainly look at saving and investing offshore – because they have the potential of achieving additional advantages over and above ‘just’ the interest rate. Additionally you can genuinely get better rates of interest offshore – at the moment there are potentially attractive one year fixed deals available from the likes of the Anglo Irish Bank in the Isle of Man or even the Alliance and Leicester in the Isle of Man. But you need to look into the stability of the jurisdiction you favour, any compensation schemes in place and also the terms and conditions of the account before you choose it.
All that said, the evidence speaks for itself, offshore saving accounts have suddenly become more fashionable and the savings rate among Britons alone virtually trebled at the end of last year as suddenly we’re all becoming aware that our debts are spiralling, our job security is dwindling and we really do need something in the bank to support us in the event of a rainy day. Thankfully sanity is prevailing again and everyone from expats to British based workers are stashing more away than ever in a bid to provide themselves with some security in this increasingly insecure financial environment.
If you’re concerned about your debt levels versus your saved wealth, or you want to get better returns on the money you have spare to squirrel away, make sure you speak to a financial adviser as soon as possible. The longer you delay, the longer it will be before you have financial peace of mind.
source: www.shelteroffshore.com
