Off shore banking

IE_sciteacher
Posts: 38
Joined: Wed Feb 27, 2019 10:05 pm

Re: Off shore banking

Post by IE_sciteacher »

As a fellow Canadian I will share what I do. I have three accounts, 1. Normal Canadian Bank Account, 2. American currency account at my Canadian bank (get paid mostly in USD) 3. Foreign Bank account in the country I live in for daily living expenses.

I am a non-resident and still have the bank accounts, DL and one credit card. As Hallam says, a few minor ties like this are not a concern. Balances in the account 1 and 2 are usually less than 5K USD with regular deposits into my investing account with IBKR. I have funded the IBKR account from both accounts 1 and 2 without any problems.

To move money around the world I predominantly use Wise.com (formerly transferwise). Super easy and very good rates. I am not crazy about using them as a bank to store my money but have no problem with them moving it between accounts.

If you are just getting started with this, I recommend joining Andrew's Facebook group as there is a ton of great advice and Andrew often chimes in with suggestions/advice.
just.the.truth

Re: Off shore banking

Post by just.the.truth »

IE_sciteacher wrote:
> As a fellow Canadian I will share what I do. I have three accounts, 1.
> Normal Canadian Bank Account, 2. American currency account at my Canadian
> bank (get paid mostly in USD) 3. Foreign Bank account in the country I live
> in for daily living expenses.
>
> I am a non-resident and still have the bank accounts, DL and one credit
> card. As Hallam says, a few minor ties like this are not a concern.
> Balances in the account 1 and 2 are usually less than 5K USD with regular
> deposits into my investing account with IBKR. I have funded the IBKR
> account from both accounts 1 and 2 without any problems.
>
> To move money around the world I predominantly use Wise.com (formerly
> transferwise). Super easy and very good rates. I am not crazy about using
> them as a bank to store my money but have no problem with them moving it
> between accounts.
>
> If you are just getting started with this, I recommend joining Andrew's
> Facebook group as there is a ton of great advice and Andrew often chimes in
> with suggestions/advice.

Really appreciate this advice. Thanks so much. I'm not on Facebook, but I've read several of Hallam's books. I'm currently reading The poor Expat, which is where I got the idea of using Saxo as my investment platform (for some reason ISR isn't letting me post the correct title. Not sure why). I contacted Saxo, and they've told me that I can send money to my Saxo account right from my country of residence, i.e. where I'm working and living. You're the 3rd fellow Canadian to mention that, about not having issues with a few secondary ties. I currently have an account with Scotiabank, and 1 credit card too. That's reassuring, thanks.

Are you keeping the balance of your Canadian accounts under 5k because you're using them as emergency funds etc.?

70% of my salary is paid in USD as well. In fact, the school I work at recommended that I open a USD account at my Canadian bank for transfers (I use Scotia). Is this necessary, or are there any benefits to doing this? I've been paid in USD at most of the schools I've worked at and never had any issues sending money to Canada. Just wondering...

Thanks again.
IE_sciteacher
Posts: 38
Joined: Wed Feb 27, 2019 10:05 pm

Re: Off shore banking

Post by IE_sciteacher »

just.the.truth wrote:
> IE_sciteacher wrote:
> > see post
>
>
> Are you keeping the balance of your Canadian accounts under 5k because you're using
> them as emergency funds etc.?
>
> 70% of my salary is paid in USD as well. In fact, the school I work at recommended
> that I open a USD account at my Canadian bank for transfers (I use Scotia). Is this
> necessary, or are there any benefits to doing this? I've been paid in USD at most of
> the schools I've worked at and never had any issues sending money to Canada. Just
> wondering...
>
> Thanks again.

Keeping Canadian accounts under 5k as somewhat an emergency fund but also to pay off monthly CC bills (flights and travel) and to be able to easily transfer money to friends and family back home to pay for presents or stuff like that. Usually the account is around 2.5K as I try and put the money into my investing account promptly to reduce the chance of spending it on stuff. No legal/tax reason just my "work flow".

I have the USD account as I have a bunch of family in the states and when visiting its easier to have a USD bank card. So not required to have the USD account but with my personal situation it helps. Having a USD account might save you money on conversion fees, something to look into. How much is the bank taking for converting the USD to CAD on an incoming transfer? If its is a number you can live with or is comparable to the fees/hassle of opening a USD account at your Canadian Bank there is probably less of a need.
Helen Back
Posts: 242
Joined: Fri Dec 28, 2012 4:16 pm

Re: Off shore banking

Post by Helen Back »

My Canadian account rarely has more than $1000 in it. It's purely for paying a couple of bills and Amazon Prime. If I do need to buy something I use Canadian credit card and transfer funds to pay it off. I haven't been in my current country long, so don't have a credit card yet.

I was with SwissQuote in Luxembourg before, but they asked me to close the account when I moved to my current country. That's why I moved to Saxo in Hong Kong.
Helen Back
Posts: 242
Joined: Fri Dec 28, 2012 4:16 pm

Re: Off shore banking

Post by Helen Back »

My Canadian account rarely has more than $1000 in it. It's purely for paying a couple of bills and Amazon Prime. If I do need to buy something I use Canadian credit card and transfer funds to pay it off. I haven't been in my current country long, so don't have a credit card yet.

I was with SwissQuote in Luxembourg before, but they asked me to close the account when I moved to my current country. That's why I moved to Saxo in Hong Kong.
just.the.truth

Re: Off shore banking

Post by just.the.truth »

> Keeping Canadian accounts under 5k as somewhat an emergency fund but also to pay off
> monthly CC bills (flights and travel) and to be able to easily transfer money to
> friends and family back home to pay for presents or stuff like that. Usually the
> account is around 2.5K as I try and put the money into my investing account promptly
> to reduce the chance of spending it on stuff. No legal/tax reason just my "work
> flow".
>
> I have the USD account as I have a bunch of family in the states and when visiting
> its easier to have a USD bank card. So not required to have the USD account but with
> my personal situation it helps. Having a USD account might save you money on
> conversion fees, something to look into. How much is the bank taking for converting
> the USD to CAD on an incoming transfer? If its is a number you can live with or is
> comparable to the fees/hassle of opening a USD account at your Canadian Bank there is
> probably less of a need.

That's very similar to my own plan!

I think you make a good point about mitigating any losses through converting USD to CAD by having a USD account. I thought about your setup and adjusted mine slightly. I'd like to have 3k in CAD and 3K USD as emergency funds, as well as my credit card. The remainder I will transfer directly to my SAXO account from Egypt (They accept this apparently).

As for the USD account, I'm with Scotiabank, and they offer a USD daily interest account. It only costs 1$ if you can't keep a 300$ minimum in the account. Otherwise there are no associated fees. The only caveat is the "daily interest" aspect of the account. I would like to avoid that so it doesn't affect my non-residency in any way. I'm sure there are options though. I just need to do more digging...

Cheers!
Last edited by just.the.truth on Tue May 03, 2022 11:37 am, edited 1 time in total.
just.the.truth

Re: Off shore banking

Post by just.the.truth »

Helen Back wrote:
> My Canadian account rarely has more than $1000 in it. It's purely for
> paying a couple of bills and Amazon Prime. If I do need to buy something I
> use Canadian credit card and transfer funds to pay it off. I haven't been
> in my current country long, so don't have a credit card yet.
>
> I was with SwissQuote in Luxembourg before, but they asked me to close the
> account when I moved to my current country. That's why I moved to Saxo in
> Hong Kong.


I had also considered this as well, only sending money back to Canada when I need to pay my credit card etc.
I was going to contact SAXO about regular contributions, and residency requirements if you move country, since we as international teachers are fairly nomadic. Thanks for answering my question. lol

This is the link I found, where you can check the residency requirements to see if you are eligible to contribute from your country of residence:

https://www.home.saxo/accounts/openacco ... penaccount

Interestingly enough, they don't allow clients residing Yukon, Ontario and Newfoundland & Labrador.
PsyGuy
Posts: 10789
Joined: Wed Oct 12, 2011 9:51 am
Location: Northern Europe

Comment

Post by PsyGuy »

I wonder what their rational for that is?
Heliotrope
Posts: 1167
Joined: Sun May 13, 2018 1:48 am

Re: Off shore banking

Post by Heliotrope »

> Interestingly enough, they don't allow clients residing Yukon, Ontario and
> Newfoundland & Labrador.

Are you sure?
If you select 'Canada', and then 'Yukon', it seems you can just go ahead and proceed with your application.
I assume they would either not give 'Yukon' as an option to select, or inform you you can't open an account after choosing 'Yukon'.

I haven't gone further than the second screen because otherwise I might end up having an account at Saxo (plus I'm not from the Yukon territory), so maybe the reveal doesn't happen until later in the process.
just.the.truth

Re: Off shore banking

Post by just.the.truth »

Heliotrope wrote:
> > Interestingly enough, they don't allow clients residing Yukon, Ontario and
> > Newfoundland & Labrador.
>
> Are you sure?
> If you select 'Canada', and then 'Yukon', it seems you can just go ahead and proceed
> with your application.
> I assume they would either not give 'Yukon' as an option to select, or inform you you
> can't open an account after choosing 'Yukon'.
>
> I haven't gone further than the second screen because otherwise I might end up having
> an account at Saxo (plus I'm not from the Yukon territory), so maybe the reveal
> doesn't happen until later in the process.


I think I had mentioned this specifically as per the link I linked to my previous comment:

https://www.home.saxo/accounts/openacco ... penaccount

"Please be aware that due to local legislation we do not accept retails clients from Yukon, Ontario and Newfoundland & Labrador."

There is no second screen. That statement appears when you select Canada as your country of residence.

Moving along, I am not residing in Canada, so this is a moot point for me. I just found it odd.
Heliotrope
Posts: 1167
Joined: Sun May 13, 2018 1:48 am

Re: Off shore banking

Post by Heliotrope »

Ah, 'retail clients', so wouldn't affect (most) teachers anyway.
But odd indeed, although 'local legislation' means at least it's not Saxo policy.

Most people I know (the ones that know their stuff) slightly prefer Interactive Brokers to Saxo, but both are apparently good options.
PsyGuy
Posts: 10789
Joined: Wed Oct 12, 2011 9:51 am
Location: Northern Europe

Discussion

Post by PsyGuy »

@Heliotrope

No, retail clients would be the vast majority of ITs, they arent commercial clients. Just as an IT that went shopping for a shirt at H&M would be a retail customer, so is an IT shopping for banking or investment products a retail customer.
just.the.truth

Re: Discussion

Post by just.the.truth »

PsyGuy wrote:
> @Heliotrope
>
> No, retail clients would be the vast majority of ITs, they arent commercial
> clients. Just as an IT that went shopping for a shirt at H&M would be a
> retail customer, so is an IT shopping for banking or investment products a
> retail customer.

I think you're right. Nevertheless, that's irrelevant to what I had originally asked. I am interested in finding out about how and where I should save my money, etc. But I do appreciate all and any relevant advice.

Most of the people "I know", are well published and respected authors like Andrew Hallam, who points out in the Mill. Expat, that at the end of the day both Saxo and Interactive Brokers are both decent choice, albeit for different reasons. Saxo has higher commissions (I believe) but apparently it's a trade off for certain insurance policies they offer against your investments. Also, Hallam states this doesnt really matter at the end of the day, and he shows 20 years projections with those fees factored in. But hey, what do I know. ;-)

Great book for any expat!
PsyGuy
Posts: 10789
Joined: Wed Oct 12, 2011 9:51 am
Location: Northern Europe

Discussion

Post by PsyGuy »

That doesnt make these authors positions and opinions published in their books accurate or correct or future proofed. Financial advice that isnt extremely generalized tends to become outdated quickly. What once was good advice can change quickly with a simple change in policy from an investment firm. Government regulations and rules can change the landscape from good to bad just as quickly. Whats good advice in general can be less good or even bad advice under specific conditions that a mass market book cant address individually.
Projections isnt seeing the future at best its a good estimate of trends that get worse the further out they are extrapolated, at worse they are a bad coin flip or spin of the wheel.
just.the.truth

Re: Discussion

Post by just.the.truth »

PsyGuy wrote:
> That doesnt make these authors positions and opinions published in their
> books accurate or correct or future proofed. Financial advice that isnt
> extremely generalized tends to become outdated quickly. What once was good
> advice can change quickly with a simple change in policy from an investment
> firm. Government regulations and rules can change the landscape from good
> to bad just as quickly. Whats good advice in general can be less good or
> even bad advice under specific conditions that a mass market book cant
> address individually.
> Projections isnt seeing the future at best its a good estimate of trends
> that get worse the further out they are extrapolated, at worse they are a
> bad coin flip or spin of the wheel.

You make a very valid point. I guess that's why he writes updated editions. lol

What would you recommend?
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