Home › Forums › Financial Markets/Economics › Moving money to another country for better interest rates
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March 11, 2014 at 7:54 AM #771736March 11, 2014 at 8:36 AM #771737
all
Participant[quote=spdrun]Define “good” — if you’re making the salary of an average middle-class American family in a country where per capita income is 1/3 that of the US, you can live like a king.[/quote]
More often than not the infrastructure will be less developed and consequently the standard of living. You would still be subjected to rolling blackouts when they happen.
Further, you might be making 3x what an average person is making, but that won’t make things more affordable. The energy, cars, electronics, even food and clothing are likely more expensive. The housing cost is what’s making the difference, but mostly because locals will settle for less. You can achieve the same in the US if you are willing to go multigenerational.
One other thing that is usually more affordable is live entertainment – theaters, concerts, movies…
Keep in mind that there will still be a lot of locals making (or at least spending) more than what you can spend, especially if you want to live in more desirable parts of the country and you likely won’t be living as a king.
March 11, 2014 at 3:47 PM #771750kev374
Participant[quote=Jazzman]Currency risk is one the biggest investment risks you can take IMO.[/quote]
but isn’t remaining in the dollar a currency risk in and of itself?? The rupee has already fallen a huge amount in the past couple of years, but the dollar has still done somewhat ok but in the face of huge upcoming challenges facing the country (that everyone seems to summarily dismiss) how is the currency going to fare?
Our current debt is $17 trillion and rising, entitlement spending is set to rise due to an aging population, $1 trillion education bubble is set to pop, healthcare spending set to rise due to increased socialized healthcare, rising costs and a population getting sicker by the day as we focus on treatment rather than prevention… does not look good to me.
March 11, 2014 at 6:39 PM #771755joec
Participant[quote=kev374][quote=Jazzman]Currency risk is one the biggest investment risks you can take IMO.[/quote]
but isn’t remaining in the dollar a currency risk in and of itself?? The rupee has already fallen a huge amount in the past couple of years, but the dollar has still done somewhat ok but in the face of huge upcoming challenges facing the country (that everyone seems to summarily dismiss) how is the currency going to fare?
Our current debt is $17 trillion and rising, entitlement spending is set to rise due to an aging population, $1 trillion education bubble is set to pop, healthcare spending set to rise due to increased socialized healthcare, rising costs and a population getting sicker by the day as we focus on treatment rather than prevention… does not look good to me.[/quote]
Currency risk tends to apply more if you don’t live in the country like the OP wants to park money into Rupee…
Reason being is say if the price of bread is now $100 a loaf, you’d assume all wages are now inflated as well since the dollar is worthless.
For the Rupee, if the Rupee weakens like that, if you spend in Rupee, it’d be ok (maybe), but if you need to “cash out” the Rupee investment to dollars, you’ve now turned 100 dollars to say 1 dollar.
Very bad risk and I feel unless you really are insanely wealthy or know what you are doing from previous work experience, you’re better off not playing this game against other people who are much more well connected/educated/does it full time, have inside benefits, etc…
March 12, 2014 at 10:10 AM #771795Jazzman
Participant[quote=earlyretirement][quote=Jazzman][quote=earlyretirement]I know this isn’t applicable to the OP as you aren’t an ex-pat but I thought this would still be interesting to post.
IRS filing for US expats is antiquated, which is why so many Americans living abroad don’t bother with it. I’m sure the IRS would agree and welcome changes to the requirement. The allowance before you owe Uncle Sam tax is reasonably generous, and there is probably no requirement from your foreign employer abroad to provide the IRS with data, so you might be able to get away with filing your own returns. If leaving the US for good, watch out for the exit tax.[/quote]
I agree it’s antiquated. I guess you could complain but who would listen? Yes, the allowance as you mention (foreign earned income tax exclusion) is quite good. $97,600 for a single person or you can legally structure it if you are married and own your own business to double that to $195,200 if you get 2 salaries for you and your spouse.
I lived abroad for many years but I’d never leave the USA for good…. we have it too good here compared to other countries.[/quote]
Living abroad broadens one’s horizons, and can make you see your home country in a different light. I’ve lived in the US for ten years and in other countries for shorter periods. That has lead to a curious unraveling. I tend to see not so much countries, but enforced boundaries (borders if you will), often through wars, organized by a collective group bound by laws that a few so-called elected (or otherwise) individuals have drawn up. The US is a perfect case in point. A young country that imposed the rule of law and property rights on a land, previously without those structures. The US is a legal entity, with a cultural focus on business and the resulting life style. Certain freedoms are a part of that package, helping to inspire a love of one’s country, that the Founding Fathers knew was needed to glue together a multicultural society. You cannot love a country. That is an illusion.
The post war decades in the US seemed very much in keeping with the ethos of individualism, egalitarianism, and evenly spread prosperity. More recent events, however, seem to echo pre-WWII periods, which have eery parallels to much that was (is) wrong with Europe, the wellspring of earlier American historical development. Whether you believe social thinking evolves or not, old models that were once the backbone of a society can erode bringing with it change that breeds conflict and social unrest. Perhaps, the only thing that keeps mankind on his toes is the certainty of uncertainty.
Sometimes I feel the only thing keeping me here is the tax climate, and the Hawaiian climate:) Like you, I would never give up my (non-US) passport, but that is as as much for sentimental reasons. The Bush tax cuts could of course be reversed, and if health care costs increase as is widely anticipated, that could be the tipping point. The lack of investment opportunities seems universal, but when all said and done, you go with where your spirit and wallet feel the most comfortable. There is no “national” preference in my view, just survival.
March 12, 2014 at 12:51 PM #771800enron_by_the_sea
Participant[quote=kev374][quote=Jazzman]Currency risk is one the biggest investment risks you can take IMO.[/quote]
but isn’t remaining in the dollar a currency risk in and of itself?? The rupee has already fallen a huge amount in the past couple of years, but the dollar has still done somewhat ok but in the face of huge upcoming challenges facing the country (that everyone seems to summarily dismiss) how is the currency going to fare?
Our current debt is $17 trillion and rising, entitlement spending is set to rise due to an aging population, $1 trillion education bubble is set to pop, healthcare spending set to rise due to increased socialized healthcare, rising costs and a population getting sicker by the day as we focus on treatment rather than prevention… does not look good to me.[/quote]
If you check out India’s deficits and debts as percentage of GDP ( esp. after adding off-the-book subsidies, state deficits etc.) you will find that the picture is not terribly different over there either.
March 18, 2014 at 6:57 AM #772011earlyretirement
Participant[quote=Jazzman][quote=earlyretirement][quote=Jazzman][quote=earlyretirement]I know this isn’t applicable to the OP as you aren’t an ex-pat but I thought this would still be interesting to post.
IRS filing for US expats is antiquated, which is why so many Americans living abroad don’t bother with it. I’m sure the IRS would agree and welcome changes to the requirement. The allowance before you owe Uncle Sam tax is reasonably generous, and there is probably no requirement from your foreign employer abroad to provide the IRS with data, so you might be able to get away with filing your own returns. If leaving the US for good, watch out for the exit tax.[/quote]
I agree it’s antiquated. I guess you could complain but who would listen? Yes, the allowance as you mention (foreign earned income tax exclusion) is quite good. $97,600 for a single person or you can legally structure it if you are married and own your own business to double that to $195,200 if you get 2 salaries for you and your spouse.
I lived abroad for many years but I’d never leave the USA for good…. we have it too good here compared to other countries.[/quote]
Living abroad broadens one’s horizons, and can make you see your home country in a different light. I’ve lived in the US for ten years and in other countries for shorter periods. That has lead to a curious unraveling. I tend to see not so much countries, but enforced boundaries (borders if you will), often through wars, organized by a collective group bound by laws that a few so-called elected (or otherwise) individuals have drawn up. The US is a perfect case in point. A young country that imposed the rule of law and property rights on a land, previously without those structures. The US is a legal entity, with a cultural focus on business and the resulting life style. Certain freedoms are a part of that package, helping to inspire a love of one’s country, that the Founding Fathers knew was needed to glue together a multicultural society. You cannot love a country. That is an illusion.
The post war decades in the US seemed very much in keeping with the ethos of individualism, egalitarianism, and evenly spread prosperity. More recent events, however, seem to echo pre-WWII periods, which have eery parallels to much that was (is) wrong with Europe, the wellspring of earlier American historical development. Whether you believe social thinking evolves or not, old models that were once the backbone of a society can erode bringing with it change that breeds conflict and social unrest. Perhaps, the only thing that keeps mankind on his toes is the certainty of uncertainty.
Sometimes I feel the only thing keeping me here is the tax climate, and the Hawaiian climate:) Like you, I would never give up my (non-US) passport, but that is as as much for sentimental reasons. The Bush tax cuts could of course be reversed, and if health care costs increase as is widely anticipated, that could be the tipping point. The lack of investment opportunities seems universal, but when all said and done, you go with where your spirit and wallet feel the most comfortable. There is no “national” preference in my view, just survival.[/quote]
Excellent post. Just out of curiosity Jazzman, if you had to move somewhere else…where would you opt to move if you left the USA?
March 18, 2014 at 6:40 PM #772047UCGal
Participant[quote=earlyretirement][quote=Jazzman][quote=earlyretirement][quote=Jazzman][quote=earlyretirement]I know this isn’t applicable to the OP as you aren’t an ex-pat but I thought this would still be interesting to post.
IRS filing for US expats is antiquated, which is why so many Americans living abroad don’t bother with it. I’m sure the IRS would agree and welcome changes to the requirement. The allowance before you owe Uncle Sam tax is reasonably generous, and there is probably no requirement from your foreign employer abroad to provide the IRS with data, so you might be able to get away with filing your own returns. If leaving the US for good, watch out for the exit tax.[/quote]
I agree it’s antiquated. I guess you could complain but who would listen? Yes, the allowance as you mention (foreign earned income tax exclusion) is quite good. $97,600 for a single person or you can legally structure it if you are married and own your own business to double that to $195,200 if you get 2 salaries for you and your spouse.
I lived abroad for many years but I’d never leave the USA for good…. we have it too good here compared to other countries.[/quote]
Living abroad broadens one’s horizons, and can make you see your home country in a different light. I’ve lived in the US for ten years and in other countries for shorter periods. That has lead to a curious unraveling. I tend to see not so much countries, but enforced boundaries (borders if you will), often through wars, organized by a collective group bound by laws that a few so-called elected (or otherwise) individuals have drawn up. The US is a perfect case in point. A young country that imposed the rule of law and property rights on a land, previously without those structures. The US is a legal entity, with a cultural focus on business and the resulting life style. Certain freedoms are a part of that package, helping to inspire a love of one’s country, that the Founding Fathers knew was needed to glue together a multicultural society. You cannot love a country. That is an illusion.
The post war decades in the US seemed very much in keeping with the ethos of individualism, egalitarianism, and evenly spread prosperity. More recent events, however, seem to echo pre-WWII periods, which have eery parallels to much that was (is) wrong with Europe, the wellspring of earlier American historical development. Whether you believe social thinking evolves or not, old models that were once the backbone of a society can erode bringing with it change that breeds conflict and social unrest. Perhaps, the only thing that keeps mankind on his toes is the certainty of uncertainty.
Sometimes I feel the only thing keeping me here is the tax climate, and the Hawaiian climate:) Like you, I would never give up my (non-US) passport, but that is as as much for sentimental reasons. The Bush tax cuts could of course be reversed, and if health care costs increase as is widely anticipated, that could be the tipping point. The lack of investment opportunities seems universal, but when all said and done, you go with where your spirit and wallet feel the most comfortable. There is no “national” preference in my view, just survival.[/quote]
Excellent post. Just out of curiosity Jazzman, if you had to move somewhere else…where would you opt to move if you left the USA?[/quote]
I think Jazzman bought a 2nd home in France and lives part of the year there.
March 19, 2014 at 12:14 PM #772092ParticipantThat’s right, I bought a second home in the Dordogne. If I left the US, I’d probably go to the UK. It’s as close as you can get to living in the US in term of tax, business environment, legal system, etc. The Antipodes are closer to a west coast life style. Remove the unfavorable French tax environment, and I’d choose the Cote D’Azure which is still the number one destination hands down. If I could create the perfect place, it would be a small country that minded its own business, had health care, a low tax environment, warm weather, rich culture, and lived within its means. I’d be watching some of the Eastern European countries like Slovenia, and Croatia to see how they shape up in a decade or two. Mexico, Costa Rica, Belize, Panama all suffer varying degrees of security risk. Bali and Dubai are interesting possibilities. Tax havens such as Bermuda, Monaco, Andorra, etc are great if you are super rich, but are mostly geographically isolated with the exception of Monaco, where you have to live in a condo. Many countries are now offering residency for cash. Hawaii is the US, but is not contiguous so in a sense I have left the US. It is, I believe, the only state where whites are not the majority. Asians out number whites 2 to 1, and it makes for an interesting, exotic mix. The life style is fantastic, and has all the benefits of being part of the US. I paid $400 property tax last year. Food, electricity, water are expensive though. Honolulu is a nice little city and Oahu has more choice than the other islands. Since there is no perfect place, splitting one’s time between two places is a possibility.
March 19, 2014 at 1:16 PM #772095FlyerInHi
GuestGiving up your US passport is a process and not easy… you have to go the embassy/consulate to formally renounce citizenship. Only a few hundred people do so every year, I believe.
Most expats just live abroad and keep citizenship.
March 19, 2014 at 1:33 PM #772096Guestjazzman, you’re a such 21st century world citizen.
I agree with almost everything you said.
Dubai sucks. All modern made-up and not much culture. Singapore is so much better. From there you can travel low-cost around the region (like spend a weekend in Ho Chi Minh city and return). If you wanted a big house, for much cheaper, you could live in Johor Bahru, across the border.
I was surprised the percapita GDP in Singapore is now $61,000 and real estate is through the roof. One of my college friends from Singapore, at the time, didn’t want to go home. Now he’s glad he was forced to return (because of scholarship agreement).
March 19, 2014 at 5:32 PM #772099ParticipantI’ve heard Singapore is expensive. The Switzerland of the East. By across the border, I guess you mean Malaysia? Have friends there but KL is hot and not cheap either. Dubai is just an address for many I guess. At one time Manaco apartments were empty with just several telephones on the floor so I’m told. Cyprus and Malta are Med islands and offer an alternative. Chile get good expat press. South Africa is an amazing country but security is an issue.
March 20, 2014 at 10:00 AM #772117GuestI now commute from Las Vegas because of tax reasons, I wanted to invest in property and when Vegas crashed, I had my opportunity. It’s my bonafide residence but it doesn’t feel like “home.” I’d rather be in HI, but alas one must make sacrifices.
I read some about Chile but never visited. There is a growing tech industry serving Latin America. Chile seems to have a good future ahead. Great climate.
March 20, 2014 at 10:09 AM #772118
CoronitaParticipant[quote=FlyerInHi]I now commute from Las Vegas because of tax reasons, I wanted to invest in property and when Vegas crashed, I had my opportunity. It’s my bonafide residence but it doesn’t feel like “home.” I’d rather be in HI, but alas one must make sacrifices.
I read some about Chile but never visited. There is a growing tech industry serving Latin America. Chile seems to have a good future ahead. Great climate.[/quote]
Hi Brian, good to see you again… Legally dodging taxes I see 🙂
March 20, 2014 at 10:38 AM #772119Participant[quote=FlyerInHi]I now commute from Las Vegas because of tax reasons, I wanted to invest in property and when Vegas crashed, I had my opportunity. It’s my bonafide residence but it doesn’t feel like “home.” I’d rather be in HI, but alas one must make sacrifices.
I read some about Chile but never visited. There is a growing tech industry serving Latin America. Chile seems to have a good future ahead. Great climate.[/quote]
A commute to SD? Las Vegas did have some good deals two years or more ago. It’s hard now to make the numbers work, but I’m hopeful there will be some sort of correction there. Funnily enough, the number one destination for Hawaiians, both when moving to the mainland, or on vacation is Las Vegas. I can’t figure that one out. Maybe there are parallels??? -
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