How much does it cost to open and maintain an offshore bank account? Many people want to have one to diversify risks (what if your account back home is suddenly frozen?), but there are a lot of those unaware of the costs involved. Some prospective offshore bank account holders tend to overestimate them, while others are influenced by some widespread misconceptions.
In this post, we will discuss the costs you will have to incur to set up an offshore account. We are the experts at the International Wealth portal who help people open bank accounts (and set up companies) in different countries, and we want our customers to make informed decisions. You can read a more detailed article on our website or contact us to open an offshore bank account today.
Table of Contents
Offshore Account: Basic Ideas
Far-sighted people open an offshore bank account to:
- Diversify their assets
- Improve their investment portfolio
- Protect their capital
These are just the most widespread goals.
When you enter the world of offshore banking, keep in mind that the traditions, requirements for customers, as well as initial deposit amounts, may differ greatly from those you are used to. It means that you have to be first of all well-informed to weigh all the pros and cons.
You will need to read the information on the bank’s website, some articles on our portal, or just get in touch with our agent who will give you all the details of what the process is like. We want our customers to make a decision they will never regret, even if this is a negative decision.
The Internet is full of misconceptions and agents that will not reveal the whole costs involved to you. Never trust the ads that promise to open an account overnight at no price. Banking services cost something – at the stage of opening and afterward.
Opening a Foreign Account: Costs
There are four items of expenditure that make up the overall cost of opening an offshore bank account:
- Agent’s services
- Account setup
- Administrative and technical costs
- Account maintenance
These are the general costs that every bank will require. If there are some special fees associated with a particular banking institution, we are sure to inform you about them.
Now let’s discuss each item in detail.
Let’s approach the issue in a straightforward way – why should you use the agent’s services if you can contact the bank directly online?
However, there are some hoops an agent will help you jump through – just because he or she does so every day. Let’s look at the challenges you may avoid:
- Some banks will require a personal visit – and you will have to plan a trip to the country unless you have an agent who knows how to open an account online (using a local representative)
- You will need to attend an interview with the bank employee to open an account. The agent will either prepare you for the questions or answer them instead of you.
- Mistakes in documents are the common reason why you may be turned down, and an agent will thoroughly check them before submission.
- An agent is a 99% guarantee of successful account opening – and if you venture on your own and fail, you will have to start the procedure all over again and waste time and money.
The conditions that offshore banks offer may differ a lot: some of them charge more for opening and have lower commissions afterward, while others have a low application processing fee and higher commissions, making account maintenance more expensive in the long run.
You will usually incur the following expenses:
- Application processing fee (from 150 to 2,000 US dollars)
- Translation and legalization of documents
- The costs associated with traveling to another country (unless you use the agent’s services)
- Courier services (you need to send the documents safely)
Administrative and Technical Costs
These costs are not connected with opening a foreign account, so they may come as an unpleasant surprise to you. However, we at International Wealth want you to be aware of all details in advance. The exact list depends on the country and the bank. Overall you may need:
- Some countries (like EU members) may need your registered address to send documents and bank cards.
- You may need a local SIM card to be able to seamlessly manage your account using a mobile app.
- Courier costs if the bank decides to send some documents to you.
- Taxes. What are the tax consequences of setting up an offshore bank account? They do exist in some countries, and you will have to study the laws to find them out or rely on the agent.
A bank account usually requires some regular payments to be kept operational, and here are the typical fees charged by banks:
- A monthly service fee that may range between 0 and 1,000 US dollars
- Outgoing payments usually come at a fee
- Currency conversion is not free, either
- If your account is inactive, you may have to pay a minimal amount
- You will have to pay a certain amount for account closure
The exact amount payable depends on a particular bank’s rates and on the activities you are going to carry out with the help of your bank account. This is the reason why our specialists will offer you to fill out a questionnaire and ask additional questions to recommend the most profitable option.
By Way of Conclusion
How much money do you need then? As you see, the exact answer depends on many factors, and we can give it after analyzing your situation.
When you look at different offers, always remember that banks never provide services for free. So if they open an account for a negligible fee, it means that they will charge larger commissions later on. On the other hand, such larger commissions may be charged for the possibility of making faster and more secure transactions, which may be precisely what you need.
We will analyze your priorities together and help you make the right decision. In general, a personal account comes at a lower cost than a corporate one. And corporate accounts may differ as well: the one opened for a high-risk company (like the one engaged in forex activities) will always cost more than an account for a low-risk entity (that engages in IT services).
No matter what your priorities are, we will help you. Follow the above link to contact International Wealth experts today!