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Dollars, roubles and euro

The desire to accumulate wealth is a natural instinct shared by people across the world. Whether the aim is to ensure a more secure future for you and your loved ones, or for a specific purpose such as the funding of your children’s education, or even that luxury car or retirement villa you have always dreamed of owning; saving towards a goal is a common feature of modern life.

For most people, the only way to achieve their goals is to save for them and a convenient way of doing this is on a regular basis. Although we all know it is something we must do to achieve our goals, the hardest part can actually be making that start, changing our mind-set from a ‘spender’ to a ‘saver’.  With regards to saving regularly, no two months financially are ever the same, so how do we cultivate the habit?

As expatriate professionals in the UAE, the financial benefits of living offshore can help with this transition to financial stability. Today’s global environment demands a savings vehicle which is tax efficient and capable of maximising returns, whilst also allowing the widest possible flexibility so that, as your circumstances or objectives change, your investments are free to change with you.

When selecting a financial product, a bespoke investment plan can be made on your behalf and tailored to your needs. When it comes to recommending a jurisdiction, the preferred locations are the Channel Islands (Isle of Man, Jersey, Guernsey). Why is this? There are two main reasons. Firstly, for tax efficiency, any investments held in these jurisdictions can remain to grow free of taxation, even if you return to a taxable jurisdiction. Contributions can still be made for the entirety of the plan, from wherever you are in the world. Secondly, security is key. We all work hard for our money, right? So protecting our hard earned savings is vital. The channel  islands offer protection like no other jurisdiction in the world, where most worldwide jurisdictions would insure customers against a set figure (Eg. UK banks £85,000) the Channel Islands have in place ‘government backed investor protection’, this means all life assurance companies would insure protection of up to 90% of entire holdings including growth.

How is growth achieved? In order to gain ‘real returns’ (returns above inflation, which is currently around 3% worldwide) investing into world class funds proves most popular. What is a fund? A fund pools together money from many individuals. A designated fund manager then uses the pooled monies to invest into a broad range of assets. The aim is to help you grow your money and if required, provide you with a regular income. By collating your investment into a fund with thousands of other investors you have access to investment opportunities that may not be available to individual investors.

Despite the above advice it is important to bear in mind that every individual is different and advice needs to be tailored to those individual needs. For example, although our savings objectives may be similar, it is important to take account of areas such as currency choice, attitude to risk and ultimately the jurisdiction in which each individual intends to retire. Once these areas are explored properly the appropriate vehicle can be chosen.

By Aaron Crotty

For additional information, you can contact Aaron Crotty at a.crotty@gwm-intl.com