Offshore savings

moregiantsteps

Hi,

I'm a UK citizen but based outside the EU, and have some sterling savings that I'd like to try to at least beat UK inflation with.

I understand that as a non-UK resident it will be next to impossible to open a UK savings account. Can anyone recommend an offshore account, though, that would give a reasonable return (preferably inflation-plus) on a one-off sterling deposit, as well as being reasonably protected (e.g. by a Guernsey / IOM / Jersey regulatory guarantee or similar)?

I've seen a Barclays Wealth account that offers around 5% variable AER, but it requires monthly deposits, so the actual "yield" across 12 months would be far less than 5% on the whole amount. Any thoughts would be greatly appreciated!

Many thanks!

Jonbvn

I think you will struggle to beat inflation at the moment.

A quick search turns up several AIB accounts which I would not touch with a bargepole.
http://www.moneysupermarket.com/savings/offshore-accounts/

Loughton_Monkey

Since it is perfectly legal for us UK residents to use offshore banks, I think you would find us all using them if there were such a thing as "Inflation proof" savings. We would even use them if they paid a shilling more than the miserable 'onshore' rates despite not being full inflation-proof.

So forget the idea completely. With inflation as it is, the only way you will 'beat' it (on savings) is to buy a 5 year (or longer) fixed rate. But most of us don't because we know that base rate, savings rates, and inflation will adjust considerably over that period.

To beat inflation, you need to turn to an Investment product. Even then, you are not guaranteed to beat inflation. It just gives you a good chance in the long term (10 years or so).

If you resort to an investment product, then I would give you a strong recommendation not to do it through a bank.

DavidHayton

Loughton_Monkey wrote: »

Since it is perfectly legal for us UK residents to use offshore banks, I think you would find us all using them if there were such a thing as "Inflation proof" savings. We would even use them if they paid a shilling more than the miserable 'onshore' rates despite not being full inflation-proof.

Agreed! But I think the OP was looking at offshore accounts because it is difficult/impossible for a non-resident to open a UK-based account unless they physically visit a branch.

I don't have any experience of using offshore providers, but it shouldn't be too difficult to trawl through the websites (HSBC, Barclays, etc etc) to see what they are offering and how to apply. But remember that offshore accounts are unlikely to be covered by any government protection schemes so do take into account the state of the bank itself. So I would agree with Jonbvn and avoid AIB at all costs.

David

barak

Loughton_Monkey wrote: »

Since it is perfectly legal for us UK residents to use offshore banks, I think you would find us all using them if there were such a thing as "Inflation proof" savings.

Somehow I doubt if we all would, even if such products were available, because as DavidHayton says the protection is just not as solid as with UK licensed institutions. :undecided

LillythePink

DavidHayton wrote: »

Agreed! But I think the OP was looking at offshore accounts because it is difficult/impossible for a non-resident to open a UK-based account unless they physically visit a branch.

I don't have any experience of using offshore providers, but it shouldn't be too difficult to trawl through the websites (HSBC, Barclays, etc etc) to see what they are offering and how to apply. But do remeber that offshore accounts are unlikely to be covered by any government protection schemes so do take into account the state of the bank itself. So I would agree with Jonbvn and avoid AIB at all costs.

David

Places like Guernsey, Jersey, IOM etc have their own protection schemes in place now. They are not covered by the UK one.

We have a large number of banks operating here (Guernsey) both mainstream ie Barclays, HSBC, Lloyds etc and other foreign banks and so will IOM & Jersey.

DavidHayton

LillythePink wrote: »

Places like Guernsey, Jersey, IOM etc have their own protection schemes in place now. They are not covered by the UK one.

We have a large number of banks operating here (Guernsey) both mainstream ie Barclays, HSBC, Lloyds etc and other foreign banks and so will IOM & Jersey.

Sorry, I didn't mean to imply that the CI and IoM are the wild west of banking services.

I appreciate that Guernsey has a protection schemes in place, but would it work if the worst happenned? To put it another way, how would the 60,000 residents of Guernsey react should they be asked to compensate rich overseas investors because a dodgy foreign bank had gone belly-up? The Icelanders weren't keen when it was their own domestic banks.

My point was that I would be happier investing in HSBC(Guernsey) than XYZ(Guernsey) where XYZ was a foreign bank known to be "in difficulties".

David

Loughton_Monkey

DavidHayton wrote: »

Agreed! But I think the OP was looking at offshore accounts because it is difficult/impossible for a non-resident to open a UK-based account unless they physically visit a branch.

Understood that he cannot use UK banks. But he did want to 'beat UK Inflation'. I stand by my assertion that he will not find Offshore banks that will 'beat' UK High Street (& Internet), let alone beat inflation.