With this fact in mind a greater number of people are taking time away from their studies and careers nowadays and spending a period of time travelling or working overseas.
If you're considering taking a similar path this article will help you get your head around managing your money when travelling, living or working abroad - once your finances are in order you can spend the whole of the rest of the time having fun, exploring the wider world and meeting many new faces!
Even if you're planning a prolonged period of expatriation you should keep your local bank account open. You can then manage money and expenses back home more easily if needs be, and maybe even send some of your overseas income back home to pay off student loans or to save up for a house purchase one day in the future. Furthermore by keeping your account open you're keeping your credit history alive which is important if you ever plan to re-settle in your home country and maybe one day apply for a mortgage or credit card.
Next up you might like to think about opening an offshore or international bank account. Possibly your bank offers such account services in which case everything just got even easier! HSBC for example offers domestic accounts all over the world and they also offer offshore accounts to expatriates and professionals living or working overseas for a period of time.
An offshore bank account will allow you to access your money wherever in the world you're located, you can have access to money from ATMs around the world, you can have instant access to your account status online or over the phone and you can bank in multiple currencies. Furthermore you can easily transfer funds around the world and have one simple, central bank
account structure that allows you to manage all of your financial needs from one centralised location.
To reduce ATM and credit card fees consider opening an account with one of the major financial institutions that have ATMs all over the world and who are recognised around the world. The benefits of going with one of the world's leading financial institutions is that their credit cards are more universally accepted, they partner with many local banks around the world and customers enjoy lower or no charges at any of their ATMs which can be found all over the world. Always check out the charge structure on any account though just to ensure there are no hidden fees.
As an expatriate you're entitled to take full advantage of the offshore world and save money offshore thus enjoying better interest rates, having access to more interesting financial products and benefiting from interest payable on savings and investments being made gross, i.e., before the deduction of tax. If you're going to be earning more than you need to live on when working overseas you should consider taking full advantage of this fact and saving as much as you can while you can benefit from the offshore advantage. You will increase your savings power and give yourself a good financial start over and above your peers back home.
Please note that you may still be liable for taxation on income derived from and interest earned on any offshore savings and investments and international taxation advice should be sought from a financial adviser or an accountant.
About the Author
Rhiannon Williamson is a freelance writer whose many articles about investing and finance have appeared in publications around the world. She is currently working in conjunction with deVere and Partners the world's largest independent financial advisory firm.
Written By: Rhiannon Williamson