subject: Lee Byers Guidance For Expats In Vulnerable Financial Positions [print this page] As mentioned in HSBCs Expat Economics section of their Expat Explorer Survey for 2010: The use of offshore centres for saving and investing appears to be under-utilised [by all expatriates]. This means that despite the strong evidence to suggest that expat professionals earn more than their peers back home and have greater disposable income as a result, they are remitting most of their money back onshore and missing out on the huge potential benefits available to them offshore.
At Lee Byers were well aware that you, our sagacious expatriate readership, are naturally more open to international ideas when it comes to your wealth and your finances, but sourcing independent information and support about the best methods of approach for saving, investing and banking is very difficult.
When you combine this fact with the knowledge that expatriates are much more exposed to issues that can potentially critically affect their wealth such as having no access to social support and needing a very flexible retirement plan for example its clear that expats are really in a vulnerable financial position. As a result, we at Lee Byers feel that there is a real need for expats to have relevant independent financial advice to support and guide them.
If youre a new expat, youre thinking about moving abroad or youve been abroad for quite some time but are not yet utilising the offshore options potentially open to you, this guide to getting relevant financial advice and support is for you.
How the Likes of HSBC, Lloyds International and Barclays Wealth are Trying to Help You
In spite of what you may think of the banking industry in general, the likes of Barclays, HSBC and Lloyds International, (specifically mentioned because they each offer a very broad range of products and services exclusively developed for expats), all offer one value added feature on their premier international bank accounts for expats.
Its the offering of this service which should be speaking volumes to expats everywhere!
The service in question is the offer of a relationship manager to assist the expatriate account holder with anything and everything - from making more of their money through investing, to saving tax on their money with relevant advice for example.
Now, were not nave i.e., were not suggesting that the banks offer this service just to make their customers happy! Of course they give the service as it allows their relationship managers to up-sell further products and services that the bank in question offers. These relationship managers understand the expat well, but they are not independent and as such they can only make recommendations based on the individual banks product-base.
However, this is a service offered by the banks because it is a service genuinely needed by expatriates everywhere!
I.e., as stated above, it is very difficult for the relocated individual to find independent financial advice that takes into account their tax position, their residency status, their long-term goals and short-term needs, their potential future tax and residency status and all the options open to them offshore for example. The banks do the best they canbut they are not independent.
How to Use the Expat Services on Offer from the Offshore Banks
A relationship manager can be a value added assistant to the expatriate to enable them to realise where their vulnerabilities lie for example, and to show them that there are options open to them offshore.
For example, a relationship manager can show their expat client that they are generally unsupported by any form of social security type safety net, and that if they fall ill, fall on hard times, lose their job or lose their home abroad they will be ineligible for state assistance in their new nation or back home in the UK perhaps.
This can extend to the relationship manager discussing health insurance requirements with the individual expat, their flexible pension needs, their life insurance requirements and maybe their need to have an international mortgage perhaps.
As an expatriate you can use all of this knowledge to your absolute advantage without having to definitely sign up for whatever product or solution the bank is selling. You can take the information and advice and do your own research into which providers are offering the most cost effective, best returning solution to whichever issue or challenge highlighted.
If you discover that your current bank actually will offer you the best service or solution, your relationship manager will likely fill in all your application forms and make things very easy for youbut if not, at least you have used their advice towards the best possible outcome i.e., ensuring that you have the right solution in place to meet any challenge highlighted.
Why Expats Need Independent Advice As Well
From our own experience and from the correspondence we receive from our readers, we know that expats are generally well aware of their need to self-support and also to self-educate when it comes to their financial possibilities i.e., they know that they have to take financial self-responsibility once they step outside their home nation and leave behind any social security safety net.
Fortunately the big banks are doing the best they can to further spread the word about: -
a) The positive and exciting options open to many expats offshore and b) The vulnerabilities that expats have to protect themselves against
However, it is up to each individual expat to use this knowledge to the best of their advantageand heres just one suggestion about how to do this: -
Seek out, (perhaps upon the recommendation of your peers or colleagues abroad), an independent financial adviser who specialises in giving expatriates comprehensive financial advice.
Such an individual should be qualified and regulated with their qualifications and regulation appropriate for the jurisdiction in which they are operating and advising and they should be experienced in dealing with internationally focused clients who have very differing needs and residency/taxation statuses.
Speak to your chosen adviser and go armed with self-knowledge, perhaps developed and honed with the help of your relationship manager from your bank, so that you can work with your independent adviser to find the best solutions to each of your financial challenges or goals from the entire offshore and onshore financial marketplace.
Why We Wont Recommend Any Single Financial Adviser
If you contact us directly for financial advice we cannot and will not give it we are not qualified to do so, whats more, your position as an expatriate has to be correctly identified and understood by any advice giver for the support they give you to be 100% accurate and appropriate.
We can put you in touch with an advisory if you so desire but in general, unless pushed to do so, we wont recommend any single financial adviser or advisory because we need to remain independent too.
In the past we have sought to work with regulated and qualified, independent advisers and act as a conduit for our readers to find those who can directly assist them with all of the above highlighted dilemmas. However, as there are so many advisers and advisories out there, in favouring just one or two who we see consistently delivering best advice could mean we overlook another adviser/advisory better placed to help a given individual perhaps.
We are not trying to shirk our responsibilities to you, our readers! What we are doing is arming you with the knowledge you need to go out and find the best adviser for you, and actively pursue your offshore options. You need to know that theres more to saving, investing and banking offshore than just saving tax and you need to know that as an expat you are potentially very vulnerable if you dont take financial self-responsibility.
In Conclusion
As an expat your individual financial, personal, tax and residency status combines with the fact that youve probably fallen out of the social security safety net back home, and it leaves you in the position where you have to take control of your situation, you have to take independent best advice, and you have to take action!
Use the resources available to you from your bank to your accountant, from your financial adviser to the internet and sites like Lee Byers and do the very best for your wealth status by exploring all your options rather than just remitting your disposable income into your old onshore bank or savings account.
by: Justin Lee
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