The best offshore saving account for me may not necessarily be the best offshore saving account for you because we all have very different saving and investing requirements and criteria.
Determining which account types suit your particular circumstances is trickier than simply looking at which financial services provider offers the highest rate of interest because there are often heavy restrictions placed on such high interest accounts which can erode the value of any interest earned for some people. This article examines some considerations you might like to make when hunting for the best offshore savings account structure.
There are such a wide range of savings accounts available both onshore and offshore and each one comes with a variety of benefits, options and criteria. Initially it’s worth determining how much you will be putting into the savings account. Will you be committing a regular amount, irregular amounts or depositing a lump sum for capital appreciation?
Some offshore saving account types are only available to those who will commit regular payments, and higher rates of interest paid on these accounts can be lost in a month where a deposit is missed for example. By being clear at the outset about the type of payment you will be making into a savings account you can avoid those that do not suit your method, amount and regularity of deposit.
Some offshore saving accounts paying higher rates of interest only pay the high rate for a fixed period after which time the interest rate earned is far lower and likely to be less competitive than other savings accounts available. Such accounts sometimes have a restriction on the number of times a year a withdrawal can be made from an account or on the notice period required for a withdrawal so that when the time comes for the interest rate to fall an investor may have to give up to three months notice for fund withdrawal.
Other catches that high interest paying savings accounts can have include paying no interest on an account in a month when a withdrawal is made or making no commitment to track base interest rates after an initial golden period during which they pay an attractive interest rate.
Savers have to be as careful as investors when it comes to their money. Financial services providers will do everything they can to get your business and very little to retain it. Once they have your money locked in for a fixed period they will not make it easy or cost effective for you to access your money. Think carefully before locking savings in to a fixed period in case something unexpected transpires in your life and results in you needing access to your money.
From personal experience one highly regarded Isle of Man based company appears to be one which makes it attractive for savers to open an account with them and incredibly unattractive for them to access their money. Fines, early savings policy encashment fees, management charges and transfer fees can erode thousands of pounds worth of savings away to nothing and when you seek to complain you may find as I did that your complaint goes unanswered.
Offshore financial services companies may be regulated but they also have many clever ways to part you from your money – permanently. Therefore when looking for the best offshore saving account take qualified independent financial advice, read all small print and think carefully about how you will be able to access your savings as and when you want or need to.
