When you’re busy globetrotting with a glamorous expat job, the last thing you want to worry about is how to open a bank account as an expat.
But, as you already know, having an international bank account is critical to supporting your expat lifestyle.
In today’s article, we’re going to help you navigate the tricky process of opening expat bank accounts.
What is expat banking? It’s basically international banking for employees who live and work outside of their home country. Expats are usually high earners with large salaries and lofty relocation packages. Banks know this and want them as clients, so some create entire expatriate banking divisions to serve them. Other banks, however, couldn’t care less.
Unfortunately, opening an account as an expat isn’t always an easy task. Whether or not you can access the best expat banking options will depend on a few important factors. For example, which part of the world you’re in, the documents you have available, how much you can deposit, your income, if you have a pre-existing relationship with the bank, and several other factors.
Expat banking can also be painfully annoying to set up and can come with major constraints. For instance, the bank might have limits on how many transactions you’re allowed to send per month.
You also might not be able to make transfers to certain countries or currencies. Customer service might be slow, non-existent, and reps may be unable to speak English (unless, of course, you’re an expat in a banking hub like Singapore or Switzerland).
Another downside is that, if you’re not careful, the fees can be painfully expensive and impossible to avoid. And then, when you leave the country, closing or transferring your account can come with even more headaches and sometimes unexpected tax consequences.
If you’d like to get a head start on account opening as a non-resident then download our FREE Non-Resident Banking Starter Guide right now!
If you choose your banking relationships carelessly and aren’t aware of the pitfalls, you could end up with tons of problems and paying thousands in unnecessary fees.
But don’t worry, when you open the right expat bank account, you can reap some serious benefits and actually make money.
In this article, we’re going to show you how to find and open a bank account as an expat. We’ll do this by explaining the biggest banking considerations for expats and the specific benefits and advantages that you should be looking to acquire. And we’re going to share one of our favorite expat banking jurisdictions that we think all expats should have on their radar.
Read on to get started with opening an expat bank account today…
That depends. The first question you need to ask yourself is…
Do you need to open the bank account before or after you arrive in the country?
Your answer to this question will dictate your banking options and which banks will accept you. This will determine fees, service quality, which documents will be required for account opening, and how much money you’ll have to deposit.
Simply put, if you need to open a bank account before arriving in your new country, your options could be limited. This is because opening an account remotely has become extremely difficult and not all banks allow it. In fact, most banks that allow remote opening for lower-level retail customers are often lower quality. Better banks will usually only allow remote opening in special cases. The bank may also require a higher minimum deposit or balance and charge additional fees.
Many expats want to have various home and life essentials set up arranged before they arrive in a new country. This can range from an apartment and cars to schooling for their children. This might also include setting up basic public services, like the internet, water, gas, and electricity.
But these living necessities in foreign countries almost always require a local bank account.
In this case, you will likely want to open a local bank account remotely. If you’re an expat in this situation, stay tuned, because we’ll outline a remote account opening option for you below.
If you’re one of the lucky expats that get to visit their new country before relocating, then you need to plan carefully. More specifically, , you need to take advantage of the trip from a banking perspective. In such instances, we strongly recommend choosing your desired banks before and then opening the best expat bank account possible during the visit.
Of course, you’ll still need to know which bank to choose, which documents to provide, which branches and bankers to contact, and which account opening strategies are best for expats in that particular country. But we’ll help you get started with all of this below.
There are a few common reasons that attract expats to open more international, expat-friendly accounts. We already shared a few of these above.
Expats have a unique set of needs, concerns, and requirements when it comes to banking that most people who live in their home countries never have to deal with or even consider. How a bank deals with your particular set of expat-centric needs ultimately dictates which bank will be best for you. So, with this mind, we’ll cover a few more expat-specific challenges that often get overlooked when choosing a bank in more detail.
One of the most obvious reasons for wanting to open a bank account as an expat is to receive your salary. And, it makes sense. Many expats want to have their salary available in the country where they live and pay expenses.
In other cases, your employer may tell you to open a local bank account. This is because some companies will only deposit salaries in local bank accounts or certain countries. Companies may require their expats employees to be paid via their local bank accounts for various reasons. These can range from anything from tax efficiencies, cost savings, or operational convenience.
While most accounts will happily receive your money, you should pay careful attention to the fees. At the very least, you should check the fees for inbound transfers and currency conversion.
Many banks catering to expats increase fees significantly higher than they would normally charge local clients. If you’re not careful, this can take a big chunk out of your monthly salary.
With this in mind, be sure to ask your banker for a clear list of all fees related to your account before the account is opened. This should include all fees related to inbound and outbound transfers. It should also include any recurring fees for account maintenance, monthly reporting, and more.
Lastly, be sure to ask if there is a fee for closing the account. This is one fee that can end up costing you significantly later on.
Just because you can receive money in your account doesn’t mean that you’ll be able to send it out whenever and wherever you like. Unfortunately, there are often restrictions and limitations that many expats only discover after their account is open.
For instance, they discover that their bank (or the country) restricts outgoing transactions in certain currencies, charges absurdly high conversion or transfer fees, requires them to physically come into the branch to make an outgoing transaction, or won’t sync to services like Transferwise.
These inefficiencies waste a lot of your time and money. They can also make it difficult and expensive to send money to your home country. For instance, as an expat, you might have expenses back home that you still need to pay. If your expat bank account doesn’t allow you to do this cost-effectively (or at all), you have a big problem.
So, before you open a bank account as an expat, you need to make sure the account you’re choosing isn’t going to give you problems and cause a world of pain.
Naturally, you will also be looking to use your expat bank account to pay for expenses locally. This might include fixed monthly expenses as well as payments for everyday items such as groceries, restaurants, or transport.
While many people will use credit cards from their home country to cover local expenses, this isn’t always economical. Depending on the card you have and the policies of vendors in your host country, you might have problems. For instance, your credit card company might end up charging extortionate foreign exchange fees for purchases made in local currency. They could also charge you additional fees for foreign transactions.
Another problem that expats run into in some countries is that local service providers can’t accept foreign credit cards. For instance, in Panama, many delivery services and local service providers only accept locally-issued credit and debit cards..
If any of the situations above happen in your host country, then you should get a local debit or credit card to replace the card from your home country. But not all banks will offer this to you. And depending on which country you are in, some banks will even require you to have a certain type of visa to be issued a debit card. Ultimately though, whether or not you need a local debit or credit card will depend on your needs and the country you are in. Regardless, make sure that the bank you’re opening an account with actually offers such services.
As a well-travelled member of the professional world, there’s a strong chance that you’re investing a portion of your salary. Whether your investments are managed by a professional advisor or you manage your investments yourself, you need to make sure that your expat bank can transfer money into your investment accounts.
This is a common problem that most expats don’t realize until it’s too late. For instance, the first time they try to send a large sum of money to their overseas investment account, they’ll discover that the transaction is blocked, that there are enormous fees attached, or that the bank requires them to come into the bank to execute the transaction.
Not talking to your banker before making an abnormally large outgoing transfer is almost always a bad idea.
Account opening procedures are slowly starting to become more standardized internationally. But the process can still vary dramatically from country to country and bank to bank.
When it comes to the specifics of the documents required to open an account, most banks will have their own particular requirements. So it’s important to know what these are before applying or visiting a branch to open the account.
Many of the documents that expats have to provide to the bank will be from foreign countries. And this is where many expats get tripped up in the opening process. Many don’t realize that the bank needs to verify the authenticity of these documents. And each bank has its own specific procedures for authentication.
For this reason, you will want to know what types of authentication are required before you start compiling documents. This is important as the process can be a costly and time-consuming process.
As for the minimum deposit and balance requirements, these can often be negotiated directly with the banker opening your account. So be sure to ask beforehand.
If you’re not sure how to approach the banker, we’ll be releasing the Ultimate Guide to Expat Banking in the coming months, which will explain the process for you. This will also include the process for identifying banks with the best fee structures and services specifically for expats.
As promised, we’re going to share one of the best places to open a bank account as an expat. But before doing so, we want to introduce a relatively new concept, which is opening an international expat bank account instead.
Most expats open a new bank account every time they move to a new country. Local accounts are useful and are sometimes necessary but opening and closing accounts every time you move to a new country is time-consuming and expensive.
Ideally, you want to have at least one international bank account with reasonable fees that you can use for transactional banking and keep over the long-term, no matter which country you move to next.
Over the years, we’ve seen a growing number of banks in traditional banking jurisdictions making moves to meet the needs of expats and location-independent individuals. These offshore banks often tailor their offerings to appeal to the very unique needs of their international clients.
The Isle of Man is an interesting banking jurisdiction for a number of reasons. Including the fact that it’s economically sound and has a relatively stable currency. But on top of that, it has a long history of providing banking services to non-residents and international clients.
Today, there are a number of international and UK banks that operate from the Isle of Man. Although, we do not recommend banking with many of them.
Like most banks in the UK and Europe, many banks in the Isle of Man have subpar financials. And as far as their liquidity is concerned, well some of them make our analysts a bit uncomfortable.
However, there are a couple of strong options. And, if you choose the right bank (and bank account) in the Isle of Man, you can capture all of the key benefits that expats look for in a bank.
We outline the entire step-by-step process for getting the best bank account and all of the expat banking services you need in our premium report Banking in the Isle of Man: Expat Bank Account Opening.
If you are already a GlobalBanks Insider and you’re looking for expat banking services, we strongly recommend reading this report now in the members-only Intelligence Reports section of the website.
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