10 Reasons Why You Need an Offshore Bank AccountNick Giambruno, Senior Editor, International Man The truth is, theres possibly all the difference in the world. Here are the top 10 reasons why you need an offshore bank account. Reason #1: Dilute Your Political Risk Doug Casey has said over and over that the biggest risk you face today is not market or financial riskas big as those risks arebut rather the risk from your own government. Theres no doubt this kind of risk is rising in most parts of the West. Governments are hopelessly sinking deeper into insolvency. Theyre turning to the same desperate measures they always have throughout history, and its a big threat to your savings. Its only prudent to expect more bail-ins (as weve seen in Cyprus), bank deposit taxes (as weve seen in Spain), retirement savings nationalizations (as weve seen in Poland, Hungary, Portugal, and Argentina), and capital controls (as weve seen in Cyprus and Iceland), among other destructive actions. And these are just a few recent examples. If you think these kinds of things cant happen in your country, think again. According to Judge Andrew Napolitano: People who have more than $100,000 in the bank are targets for any government thats looking for money to shore up its own inability to manage its finances. A big part of any strategy to reduce your political risk is to place some of your savings outside the immediate reach of the thieving bureaucrats in your home country. Obtaining an offshore bank account is a convenient way to do just that. That way your savings cannot be easily confiscated, frozen, or devalued at the drop of a hat or with a couple of taps on the keyboard. In the event capital controls are imposed, an offshore bank account will help ensure that you have access to your money when you need it the most. In short, your savings in an offshore bank will largely be safe from any madness in your home country. Reason #2: Sounder Banking Systems and Banks Almost all of the banking systems in Western countries are fundamentally unsoundleveraged to the hilt and backed by the promises of insolvent governments. Worse, most of these banks only keep a tiny fraction of cash on hand to meet customer withdrawal requests. This means that in the event of a financial shock like another Lehman-style event, you could have trouble accessing your money. If you look to bank in a jurisdiction with low debt and a history of a stability, you can find banks that dont gamble with customer deposits (i.e., your money), are much better capitalized, keep more cash on hand, and are otherwise much more conservatively run than those in the US. Offshore banks are almost always more responsible custodians of your hard earned-savings. Reason #3: Asset Protection Maybe you think its just other people who live on the lawsuit firing line and you live somewhere else. Think again. The Legal Resource Network reports that 15 million lawsuits are filed in the US every year. That works out to a new lawsuit for one out of every 12 adults each year year after year. Unless youre exceptionally lucky, sooner or later your turn will come. Youre not going to like it. Its no fluke that 80% of the worlds lawyersover 1.2 million of themwork in the US. Thats where the action is. Your money is the trophy theyre competing for. While there is no such thing as 100% protection, an offshore bank account can help make you a hard target. An offshore bank account also protects you from being paralyzed by a lightning seizure by any government agency armed with a summary power to freeze your assets, since such summary powers cant reach beyond the US. If you ever find yourself in a wrestling match with a government agency or with a frivolous lawsuit, youll have resources you can count on. Reason #4: Currency Diversification Holding foreign currencies is a great way to diversify the risk in your portfolio, protect your purchasing power, and internationalize some of your savings. Chances are though, that your domestic bank offers fewif anyoptions to hold foreign currencies. Offshore banks, on the other hand, commonly offer convenient online platforms for you to hold foreign currencies. Reason #5: Higher Interest Rates for Your Deposits In what amounts to a war on savers, the European Central Bank and the Fed have manipulated interest rates to near historical lows. These artificially low interest rates amount to a wealth transfer from saverswho would otherwise enjoy higher returns on their depositsto borrowers. In fact, if you live in the West, theres a good chance that the interest youre earning on your savings isnt even keeping pace with the real rate of inflation. If you look abroad, though, you can find banks that pay interest rates significantly higher than what youd find at home. Reason #6: Ensure Access to Medical Care Abroad In the case youre denied or delayed treatment in your home countryan increasing possibility with the disastrous Obamacareyou may want to seek medical care abroad. In a dramatic scenario, this could be the difference between life and death. Suppose that for whatever reason, you cannot get the medical care you need in your home country and have to go abroad. That means youll have to transfer money abroad to pay for it. But if capital controls are imposed, it could be difficult or impossible to transfer funds abroad to pay for the medical care you need. This is where having an offshore bank accountwhich isnt held hostage to capital controls in your home countrycan help ensure that you always have access to medical care abroad. Reason #7: The Ability to Act Quickly When it comes to international diversification, its always better to be a year early than a minute too late. Once a government has imposed capital controls or levied bank accounts, it will be too late to take protective action. If you dont already have one, you should open an offshore bank account noweven if its a small one. Just having one availableregardless of how much money you initially put in itgives you meaningful benefits. Namely the option to act quickly and transfer more money abroad in the future, should the situation warrant it. Reason #8: Maintain Limited Privacy Americans who have an aggregate of $10,000 or more in foreign financial accounts at any time during the year must file an FBAR (FinCEN Form 114). However, if the aggregate total of your foreign financial accounts remains under $10,000 for the year, and they are not held in a trust, LLC, or other structure, you can legally maintain your privacy. Reason #9: Peace of Mind An offshore bank account is like an insurance policy. It helps protect you from unsound banks and banking systems and the destructive actions of a bankrupt government. It also makes you a hard target for frivolous lawsuits and allows you to pay for medical care abroad. Knowing that you have taken a strong measure to protect yourself from these things should give you a degree of mental comfort. Reason #10: Maximize Your Personal Freedom Having an offshore bank account gives you more options. More options means more freedom. Achieve that freedom, and it becomes very difficult for any government to control your destiny. Conclusion Its no secret that it is becoming harder and harder to open an offshore bank account. Soon it could be impossible. This is a strong incentive to act sooner rather than later to get oneeven if you dont plan to use it immediately. Even if your home government doesnt slap on capital controls or confiscate deposits, youre no worse off for having moved your savings to a safer home. In fact, youre far better off for the reasons described above. Obtaining an offshore bank account is a prudent step that makes sense no matter what. Despite what you may hear, offshore banking is completely legal and is not about tax evasion or other illegal activities. Its simply about legally diversifying your political risk by putting your liquid savings in sound, well-capitalized institutions where theyre treated best. Companion Article: Now that you know the reasons why you need to open an offshore bank account, the next question is how. It can be a daunting task but it neednt be. There are experts who know the ins and outs, from the best countries to set up your account to what to say and how much money to have readyand you can get all that information and much more in Going Global 2015. Its the ultimate primer in going international and will save you not only cash, but a lot of hassle. Check it out and get started today while its still possible. Heres 1 GREAT reason to not put money in any bank, ANYWHERE. Reason # 1 , If its not in your pocket then its in somebody elses. Why would any sane person keep money in a bank where you dont have access to if they close for all and any reason , cyber attack , bank failure whatever. You make ZERO intrest and take all the risk as a deposit is a non collateral loan to the bank. The FDIC stickers have been removed off the front doors of ALL banks , you get nothing. Take everything out now and leave enough to pay bills so when the bail ins come you dont have to be bailed out. Offshore accounts , think how much harder it will be to get your money from another country when dollar hits the fan. Is the person who wrote this article even aware of FATCA, (Foreign Account Tax Compliance Act) ? I dont see it mentioned one time. Because of this your money is not any safer overseas than it is here in the states. Offshore? Agreed! Didnt the numbered accounts in Switzerland have to pay a fine of $1.8 Billion USD because the IRS, and Fatca required the Swiss to snitch on the owners of those accounts? The reason that there is no mention of WHERE to put your money offshore in this article is because the writer of this article is advertising the book that contains all of this vital information. The government can now legally (and will) take your money to pay off government debts. Here is my solution: take your savings and buy real estate. Not in areas (like California, which have already devolved into new bubbles) but in places where prices are so low that they cant go much lower. I have recently, with my meager savings, bought 2 properties near Sedona (average list price: 900,00K): one is a 1600 Sq ft 1980 milled log house which backs to an abandoned golf course on land that is deep and fertile, supporting huge trees (up to 7ft diameters) as an oasis in the rocky desert. I am renting it out, at a very low price, to a large family and getting a 12% return. The other property is near by, an older mobile home on a very nice lot with huge trees and shade, a big carport and shed and good privacy. The mobile home is in excellent condition, ready to rent. I am buying for 32K cash and will rent it out cheap for under $500 a month, with only $125 a yr in taxes. If I can save some more I am thinking of buying a house in Costa Rica for 30-40K, with very low taxes and in a nation without a military where the police (except in San Jose) do not even carry arms. I have already lost a ton on medical marijuana stocks (down 2/3 in the last year) and have no desire to invest in the market or in the California bubble economy (which I cannot afford anyway). I may sell my Santa Cruz Mt home which I built myself if the bubble continues in the near future and re-invest in an area which where real estate is still depressed. There may be better solutions but that is my attempt to create a retirement income out of my small savings. In 2007-9, I lost 300K in inflated equity the result of 45 years of sweat equity. Buy low, sell high. Money can be wiped out overnight (I learned quickly), but livable land and homes have a lasting value. I welcome constructive disagreement. Hi Neighbor: Jeff from SJO here! I went to Costa Rica x1, and I like your idea of a home the same price as a new car here! I found it wonderful there! Thailand would also work for me! I agree with much of what you have said, and I am in a similar dissatisfied funk here in SJO. I would not, for me, go into debt, everperiod. I also know Sedona, and again, I would liquify any debt. You should work on your health, travel, relax, plan ahead. If you do not hold it in your hand, it is not yours. Though your income property sounds productive, I might encourage you to agin, liquidate, and pay cash for a place in Guanacaste, Costa Rica. You also said money can be wiped out overnight. I would still liquidate, pay cash for your own mobile home, a comfortable place in Costa Rica and wear a proverbial grin on my face, every time I met the legal ladies of Costa Rica!!! Go have fun, its time Sir! Im an RN, and those guys who postpone their desires have heart attacks and strokes when they are packing for their Dream Trip that then NEVER happens! Good Luck: You have enviable choices! obama care prevents insurances from denying care. So reason #6 is bullshit. The game as played, dont be afraid, its just castles burning Just a few moments away from cashless, Cabalian cards then do their trick, you want to purchase groceries, sorry sir, it seems we have a problem, the card issuer has blocked your account. Do you perhaps have another unblocked card; I notice that the code on your declined transaction is 666 dont release goods, call security. Hmmmm buy property overseas. no need for fbar. no way uncle sam can take as it has no jurisdiction there. nobody needs even to know it. 