Offshore Savings Accounts and Interest Rates

An assumption can often get us into trouble – for example, if we assume that the weather in the Mediterranean will always be warm and sunny and we relocate to Cyprus and discover that actually, in the winter it’s cold and it rains, such an assumption will find us wet and miserable!

When it comes to money matters – any assumption can be highly costly!  For example, if you assume that an offshore savings account will offer you the best interest rates simply because it is offshore, you could well be barking up the wrong tree.

Some offshore savings accounts offer more dire rates of interest than you can actually get by staying onshore – and they lure you in to taking out such an account with the taxation saving advantages that you may be able to prosper from with such an account!  The moral of the story therefore is that when it comes to your money, it matters so much that you really need to look closely to make sure you’re getting the best deal for your wealth.

At the time of writing there’s a bit of a war going on between the international divisions of the so-called high street banks such as HSBC, Barclays, Lloyds TSB etc.  All want to win new business because they need your money in their coffers to make their balance sheets look healthier.  This means that they are all offering something in the way of an interest rate incentive.

You have HSBC’s Online Bonus Saver Account where the standard rate available is boosted if you make no withdrawals for a set period of time by 1.00% on the GBP accounts (AER of course), 0.50% on USD accounts and 1.00% on EUR accounts.  Such a boost can make a real difference to you money.  Barclays Wealth on the other hand has a deal whereby you can earn up to 5% AER (4.89% gross) variable for 12 months with their Monthly Saver account.  Again – there are withdrawal and deposit restrictions.

From Lloyds TSB there are term deposit accounts on offer as well as bonus savings accounts – and so clearly, as stated, they all want your business.  But is the high street the best place to go for your savings?  Well, that all depends on a number of critical criteria.  For example, where are you living, where do you want to save your money, in which currency would you like to save, how much access would you like to have to your wealth, how long can you tie your cash in for, are you making regular payments or saving a lump sum?

You see, it’s not so easy to just go out there and pick an account off the shelf that will necessarily meet all of your criteria for it!  To add to the complexity is one simple fact – none of the financial institutions are in the business of always offering the best, most preferential rates to anyone through popular forms of advertising.  It’s true!  Every single financial institution that we’re aware of regularly makes the best accounts available only to a limited number of individuals – and they make the accounts available only through financial advisers.

You see, it’s a symbiotic relationship whereby the banks or finance houses offer the best independent financial advisers the best rates – they then go out and get new customers.  The customer benefits from the best account, the financial adviser benefits from gaining commission and the financial institution benefits because they get new customers without having to do much of the leg-work at all – that’s done by the financial adviser.

So you see, when it comes to offshore savings accounts and interest rates, you might assume that you’ll find the best rates from the leading banks – but that may very well not be the case.  You may have to dig so deep to find an account that suits you, and even then you may still come up short.  Our advice to you therefore, is seek the services and advice of an adviser – find out what sort of interest rates they can get you at the moment.  You may very well be surprised and positively impressed by what they have on offer!  To that end, complete our offshore advice form and find out what the best savings interest rates are today.