Teach Middle East Magazine May 2014 issue 1 vol. 1 | Page 27

Finance

DOING IT RIGHT: MULTICURRENCY
INTERNATIONAL SAVINGS PLANS
By Aaron Crotty

T

he 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 mindset 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 \