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I love to simplify my finances and have been ever since online banking started. Automated payments, savings, and rent deposits from my tenants make my life so much easier. But there is one thing I can’t do: having just one bank account. I need my French account to pay my taxes and receive birthday gifts from my mum :). International bank number one is in the UK, I get rent money on that one, the occasional freelance work payment, and pay all my bills and taxes on my UK property. International bank number two is in Guatemala. I have a US dollars account there, to add to the fun. Because the Guatemalan currency is something few banks deal with, I can’t really have all my banking under one roof.
The good part is that if a bank fails me, I still have a few more institutions to turn to in order to retrieve part of my funds. I can also spread the currency fluctuation risk between US dollars, British Pounds and Euros. During the year, if the Euros come to a high, I will transfer some of my savings into Pounds, then do the reverse operation once the Pound is high. I can lose money on those transfers too, but thanks to a financial institution that has tight spreads, that is rarely the case.
Are expats bank accounts worth it?
In France, I used to have an expat bank account that cost $30 per month to use. It came with a debit card that had no withdrawal or foreign exchange fees, and you could receive your salary in a foreign currency, or wire funds abroad for free. Considering every ATM withdrawal abroad would incur a charge of $10 or more, it was very well worth it when I was country hoping. It also allowed me to avoid opening a local bank account. I could just withdraw small amounts at a time, which was also a safer option.
Now that I am more rooted, I have chosen to open a local bank account. I can wire some funds from my European accounts, and keep local currency for my everyday needs. I still rely on a UK credit card with no withdrawal fees for big purchases, to enjoy the 50 days interest free shopping, and keep my accounts open for the reasons mentioned earlier. But I need the local bank for small transactions, like paying the workers on my house with a check and not having to go withdraw lots of cash to pay them.
Something that was not available in Guatemala was that a bank that had branches in Europe offers expat services. You can do this if your high street bank has branches abroad, they will help you set up a bank account and get you all ready to go before you even move to your new country. It took me about a month to get my account sorted here, and I wish they had had that option to get my credit and banking history over and facilitate my application.
This ease of life is well worth the expat account fees, although if you stay somewhere long term you should look into local banking.
I really appreciate the insight into ex-pat life! It’s something that always has interested me. While you do mention some of the difficulties that come with ex-pat banking, it’s truly remarkable what we can do in today’s day and age. I particularly like that you are able to spread around your currency risk, since I don’t think people take that into consideration as much as they should.
Indeed you can do so much now with online banking and the like, pay your bills in a matter of minutes instead of sending a check over the ocean. The little bumps on the road are really nothing compared to 20 years ago.
Interestingly, I have an French bank account, and then countless Australian bank accounts (savings, mortgage, credit card, shares). I love that the French account EMAILED me personally when I was overdrawn – that would never ever happen in Australia – they’d just lay the fees on! It costs me to keep the BNP Paribas account, but given my life’s goal is to return to living in France, it seems worth it. That, and being back in France every two years seems to make it worthwhile in the short term – I love being able to use it at CDG RER station, where my Australian cards are often stubbornly rejected!
yes we aren’t big on interest/debt.. There is a warning you can put on most accounts if you are under say $20 euros, they will email you too, that is pretty neat.