Job: Check. Accommodation: Check. Visa: Check. How about your finance? Carefully considering your banking options before moving abroad could save you money and time. Depending on your reason for moving abroad and the duration of your stay, you could be tempted to use the bank account from your home country or open a local bank account in your home country. But have you thought of an international bank account? Here is why you should consider it and what you should look out for.
Whether you're a serial expat, an entrepreneur, a retiree, or you're moving abroad for work, an international bank account is a must-have. But what differs it from your regular bank account in your home country and a local bank account in your host country? While it's advised to open a local bank account once you've settled, for example, to receive your salary or pay your bills, there are many benefits to having an international bank account. Flexibility is definitely one of them as you'll be able to access your account from anywhere at any time and withdraw money from any ATM around the globe.
Banking in any currency around the world
If you're a freelancer or a digital nomad, for example, you might be receiving payments in all kinds of currencies, euros, US dollars, pound sterlings or even yuans or dirhams. Also, as a regular traveller, you obviously won't be opening a bank account in every single country you're moving to. An international bank account can help in many ways, such as keeping different currencies in a single account whereas your bank in your home or host country would request you to choose different currencies for opening a bank account. So that saves you the hassle of managing multiple bank accounts. It even helps if you're a foreign professional or retiree abroad who's receiving revenue from different sources, such as rent, pension, etc. Another benefit is that you can convert your money easily to get the benefits of currency fluctuations.
Low money transfer charges
As an expat, you'll probably be transferring money abroad, whether to your family in your home country, or transferring the revenue you received from rent or pension to your local bank account. All this comes with a cost, so you might often have to wait for a specific moment for low rates to be able to make your transfer. With an international bank account, money transfer charges are low, so currency fluctuations won't be an issue.
It's usually tax-free
It all depends on your country of residence and the bank you're dealing with. For example, some countries impose taxes on expat remittances. By using an international bank account, you can choose the exact amount of money you wish to transfer in your host country and leave the rest as savings. As a globetrotter, the least you would want is to fall short of money in unforeseen circumstances due to income tax. However, make sure to inquire with a banking professional about tax issues beforehand.
Higher interest on savings
As an expat, you probably have some long-term plans for which you might be saving money. The good news is that having an international bank account can help you benefit from higher interest rates, especially with different currencies on it, and if you've made a fixed deposit.
Easier access to mortgage
If you've always dreamed of becoming a homeowner abroad, international banking can make it come true. In fact, you're less likely to obtain a mortgage in the first year following the opening of a bank account in your host country. Now imagine applying for a mortgage in your home country when you've been away for a couple of years. With an international bank account, you might be entitled to more competitive mortgage rates and many other benefits. But in any case, make sure to seek financial advice first.
