We take a look at why many expatriates in Vietnam invest offshore, the advantages it offers and how you can ensure that you get the right advice to make informed decisions about whether an offshore investment is suitable for you.
Offshore investing for expatriates in Vietnam
An important aspect of financial planning is investing for the future. If you are an expatriate in Vietnam and you want to get the best out of your money, it makes sense to consider an offshore investment. People often assume that offshore investing is the preserve of the super wealthy, or even that it is illegal, however, it simply means investing your money in a location other than the one in which you live.
Why invest offshore
If you are working in Vietnam, it is unlikely that you will be contributing into a pension fund. You do therefore need to ensure that you are on top of your own financial planning and saving and investing a sufficient proportion of your income to attain a comfortable retirement.
Offshore investing can play an important role in your plan and bring many advantages. These include:
1. Broad choice of investments
Whatever you want to achieve, whether you are risk averse or have an adventurous outlook, there are investments out there to meet your requirements. From lump sum investments to regular savings plans, multi-asset to bespoke portfolios; there is a huge choice of products for expatriates to maximise the potential of their savings. We strongly advise you speak to a financial adviser who is a cross-border specialist based in Vietnam to ensure you have considered the risks as well as the upside, and that you are aware of any fees, commission and other expenses related to individual offshore investments.
2. Security
There are risks to investing in Vietnam. A major consideration for expats is the well-known problem of getting money out of the country. In addition, 2021 has been a particularly volatile year as Vietnam has gone from being one of the best performing economies in the early days of the pandemic to recording negative growth for the first time since 2000 in Q3. We advise expatriates to save in an internationally respected jurisdiction where investments are covered by a robust legal framework and a compensation scheme. At Infinity we only recommend products in the safe offshore jurisdictions of Jersey, Guernsey and the Isle of Man.
3. Ability to diversify and mitigate risk
Diversification is a cornerstone of financial planning because it helps spread risk. Offshore investing facilitates this, enabling investors to diversify geographically as well as by asset, currency and sector.
4. Tax advantages
Many offshore products are designed to structure your investments to grow your wealth while minimising tax. Depending on your personal circumstances, you will have access to legitimate investment opportunities which are more tax-efficient than those in Vietnam or your country of domicile and the potential for tax-free income on retirement.
5. Flexibility
As your circumstances change, you can reduce, halt and restart contributions into an offshore retirement vehicle whenever you wish. You also have the flexibility to invest in different currencies and manage currency risk.
As an investor, you will be aiming to protect your money and grow your wealth to prepare for retirement. To find the best way to do this taking into account your financial goals, risk profile and status, talk to a financial adviser about how best to invest offshore. A professional can also help you choose whether to opt for a simple wrapper or whether a trust or company might be a better option.
Contact Infinity in Vietnam today at vietnam@infinitysolutions.com for further advice on investing offshore.
A leading provider of expat financial services and wealth management services across Asia.
