questionshave you ever put money in a bank in a different…


I remember getting 5.25% just before the last crash. Good times.
Now I can barely get 0.8%.


Before putting any money overseas, understand what you need to do compliance-wise. There are a number of filing requirements (FBAR; form TD F 90-22.1 is the big one) and the IRS has been very aggressive of late with enforcement surrounding foreign accounts.

Additionally, as I understand it, there are reporting requirements involved if you're moving a semi-large amount of money out of the country at any given time, but I'm not in banking, so I can't speak to it.


My fiancee and I get anywhere from 10 - 12%, annually, in our Caixa savings account here in Brazil.

My Chinese bank account only got around 2%, annually, for a savings account, but I also remember their interest rates being quite a bit more reasonable than both USA or Brazil. I hope to diversify my money in both Chinese and Brazilian banks in the next few years.

If Obama gets reelected, I'm pulling my last $3K, saved in a CD in the states. Since he's been elected for the first time, my money in USD has lost quite a bit of value in comparison to Brazilian Reais and RMB, which is actual money lost for me, as I'm living abroad :/

Also, @dcalotta is correct, but there are exceptions. For example, if you marry someone who is not a US citizen. Now you have the ability to generate income, jointly, outside of the states, but keep it under his/her name, and thus our grimy government's fingers off of it.


@dmaz: I would check with your accountant :) Generally, US citizens are subject to US tax on their worldwide income, without regard to where they are domiciled... but chat with someone who knows the details of your situation.


@dcalotta: Thanks, hehe. I've also checked into this. Any income that we don't want taxed by the US government we just have paid to her alone, in her name. So, for all intensive purposes, I'm just on an extended vacation, mooching off of my wife (even though I'm actually working and just, technically, not getting paid for it). We pay enough taxes to the Brazilian government. The only downside is that I'm not paying into Social Security, but let's be honest with one another. That's not going to exist when I'm of age to collect anyway.


@dmaz: I am not looking to cheat anyone (including the US govt) out of any money. I figure if I can get roughly 10x the interest by investing overseas than what I get here, paying 30% of the interest in tax still leaves me way ahead.

For example, if I invested $100 at 8% in another country versus 0.8% here, that $8 would be taxed at 35%. That's $2.80 in tax which leaves $5.20 in actual interest. Compared to the $.80 I would have earned in interest in the states, I'm still up $4.40.

Obviously, I wouldn't bother for just $100, as the transfer fees would likely far exceed the $4.40 in profit. Nonetheless, it should scale fairly well from there.

The biggest questions from my point of view would be related to how the other country would treat the interest, as well as any requirements for investing there, and how long it would take to access the money (as well as what that might cost).


@dcalotta: I actually suspect that the amount of money I would be investing would be so small as to either not attract any attention, or end up not being worthwhile due to fees from bank transfers.

We're talking about the amount of money that a wealthy person might spend on a decent suit or a fairly nice night out on the town. Not even the amount of money a wealthy person would spend on a second car, or a middle class person would finance to purchase a new car.


@lparsons42: I've considered my options quite a bit, and what you are talking about does have a lot of credence.

For example, even if I, as you suggest, am making 2% more through having my money invested here, overseas, would it be worth it at all, if we need to high-tail it back to the states with most of our money. I haven't fully looked into the ramifications of getting over $50,000 cash back into the states, legally, but I know it wouldn't be quite as cheap as just investing a solid chunk in the states and continuing to pay taxes on it, while I'm not there. Still, based on what I've observed in business in both China and Brazil, over the last two years, no one has any confidence in Obama (he's nearly a laughing-stock, sadly), and I would be afraid to leave my money there for another four years, assuming he's still in office...


@dmaz: I've been trying to stay apolitical in this discussion, as I don't see how politics really matters in regards to this question.

However, you insist on being political with every response you write here. So please, share with us what Obama's re-election has to do with overseas business?

Anyone who is awake knows that Romney's campaign is rapidly imploding and he has no chance of winning. That said, any political observer on the international stage also recognizes that Obama's actual actions have been exceptionally conservative and pro-business so even if somehow Obama were to implode and Romney won, there is no good reason to expect that things would change dramatically.


@lparsons42: I was only talking politics as it applied to me and this topic. Someone can know everything about campaigns, and how each candidate is on the issues, but that doesn't matter when you stop and look at the actual numbers.

I'm just letting you guys who are sitting at home know how things are looking, from out here, from an international investing standpoint (which is on-topic). Looking just at the numbers, the country is in the worst shape it's been in in decades. Other countries are losing faith. I don't care if a resurrected Jimmy Carter was running against Obama, I would vote for anyone but him, because he's proven he can't help our country....which is why I'm kind of big on investing internationally right now :)


When we were vacationing on Grand Cayman a couple of years ago, my friend and I talked about opening a savings account there with whatever the minimum amount was, just so we could say "I have an offshore account in the Caymans." But I've never considered actually moving my real money out of the country. I try to buy local, support local business, even when it doesn't produce the best immediate financial results I think it is a sound choice in the long run. If everyone who had money invested in the economies of other countries were to invest that money here in the US instead, I am confident that our own economy would be much stronger.


@lparsons42: It will usually cost you a couple percent to move the money in and out of the country in exchange fees. You'll also be risking losses as the relative value of the dollar to the remote currency fluctuates. You'll pay taxes first to the country the interest is paid in and then if that's less than what you'd pay in the US you'll owe the difference to uncle sam.

If you're willing to take some risk, you're better off in a good stock/bond index fund (and you can get better tax rates if you hold them a year or more). If you want more safety look at series I savings bonds, which are currently paying 2.2% and adjust every 6 months to match inflation.


@dmaz: for all INTENTS AND PURPOSES, not intensive purposes.
Not trying to be rude, but people making mistakes like that come across as ignorant, and you don't seem to be ignorant. I've been doing something similar the last few months, moving some of my Roth IRA funds from mutual funds that are invested in US companies to those that are invested in Asian and Pacific companies. My mutual finds were 85% US companies but are now about 60% US, 30% Asian and 10% European, and that 10% European may soon get reduced to 5% if they don't get their house in order.


I can't even put money in a US bank. :(


We've got some stuff in Luxembourg. Maybe look into that? Unfortunately, I don't know much about it, just that we've got stuff in Luxembourg and it's good and safe and making baby monies there.

But why a savings account, necessarily? Why not a diversified mutual fund? I've got some stuff in a few different mututal funds and a couple bonds for security and balance. My favorite is the one I actually chose myself (fun!)--an emerging markets one with JPMorganChase. I've seen fantastic returns on that one. I actually paid for my new (used) car last month and my birthday vacation next month with the returns from the last three years on that particular fund.

Now, I know nothing from money management except for what my accountant tells me. So take my advice for what it's worth: darned near nothing but maybe a starting point or an interesting direction to research?


@kamikazeken: One of my English teachers in college mentioned this mistake, among other ones. She stated that, aside from other mistakes such as "irregardless" (which isn't a word), saying "all intensive purposes", though not the traditional phrase, has meaning that is similar to the traditional phrase, and you can use it just to grind people's gears. Thus, I like to use it :P