Opening a Bank Account Abroad

Moving abroad can be quite a complicated logistical operation - especially if you go to the lengths of planning every single aspect of your new life from opening a bank account abroad to canceling the milk back home before you go like all the living abroad magazines and books tell you you should!

You have to sort out a job, a new home, maybe even a new school for the children...and then when you arrive the list of tasks to be completed can seem impenetrable!  Well, hopefully the information on this site will help you get a handle on becoming an expatriate and this particular article covers opening a bank account abroad.

As an expatriate you have a few banking type decisions to make...should you keep your old bank account open, should you open a new bank account in your new country and what about the benefits of opening an offshore bank account?

Well, of course your personal circumstances may dictate the answer to one or more of these questions but as a rule of thumb here’s what we recommend: -

Should you keep your old bank account open?

If you have any financial ties back home such as ongoing mortgage payments, maintenance payments or even a magazine or satellite TV subscription then you should keep your basic domestic bank account open for maximum simplicity!

If you think you might one day wish to repatriate - even if in thirty year’s time - you should also consider retaining your account as it gives you some form of credit history for the future.

The only times you should close your account are if your bank or bank account stipulates that you cannot hold the account if you become non-resident or if you wish to take on a different country of domicile.  To change domicile is tricky and it involves cutting all ties with your previous country of domicile.  If you keep a bank account open you will most likely be ineligible for a change of domicile.

Should you open a current account in your new country of residence?

A little will depend on the country you’re living in and the stability and security of its status - i.e., if you’re living in a war torn or unstable jurisdiction where there is a chance of austerity you might want to think twice about opening a local account.  If on the other hand you’re in a stable country with proper banking regulation then there’s no real reason why you shouldn’t open a local account.

A local bank account can be beneficial or even necessary for the payment of wages and it can be really useful when you want to sign up locally for services like telephone, internet, satellite TV etc.  Once you’ve selected your banking provider the information you will need to present to open a bank account will be your passport and proof of address.  Additional information is occasionally required such as a reference from your previous bank but usually your passport and proof of address are sufficient to get you a basic current account.

It is unlikely that you’ll be offered anything other than a debit card initially as you will have no credit history with that bank which is where the next question comes in…

Would it be beneficial to open an offshore bank account?

Many offshore banking providers allow an account holder to place a certain amount of money in a secure account which they use as guarantee for a credit card.  You then have a credit limit up to the amount in the secure account and this can be of immense use to expatriates when they first arrive abroad and have various expenses to handle.

Other benefits of an offshore bank account for an expatriate include the flexibility of the account - you can bank and transact in multiple currencies, you can have one centralized place for all your banking needs and potentially rule out the need for a domestic account either back home or in your new country.

As previously stated your personal circumstances will have a strong influence on the decisions you make and if you require personalized financial advice about banking, investing, insurance and saving while living overseas please use our offshore advice form to get in touch.

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