||Ask Dr. Don
Foreign savings accounts
Dear Dr. Don,
Do you think it is wise to keep some
money in a Swiss bank account vs. an American savings account?
What is motivating you to send your money abroad?
Savers typically evaluate their investments by: safety
of principal, liquidity and yield.
Ignoring any offshore arguments concerning federal
income tax avoidance, the liquidity and yield will be better in
a U.S. account than it will be in a Swiss account.
That leaves safety of principal. Do you really fear
the collapse of the banking system in the United States? If that's
your motivation you need a cash stash closer to home.
banks accounts: myth vs. reality, a Bankrate feature, discusses
the ins and outs of having deposits in Swiss banks in greater depth.
The interest rates in Switzerland are low and the banks aren't really
looking for retail deposits. That means that you'll pay up for the
privilege of having a Swiss account.
If you're looking to make a currency play using
foreign-currency-denominated, FDIC-insured deposits; there are U.S.
banks that offer foreign denominated deposits.
One of these banks, Everbank,
at this writing offers 1 percent on CDs denominated in Swiss Francs
whether it's a three-month CD or a 12-month CD.
I have a prior column that discusses foreign
-- Posted: June 26, 2003