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Saving Plan Overseas (for edit)

Saving Plan Overseas (for edit)

No Matter where in the world you might be, a regular savings plan can help you use your money wisely to make your future a little more certain. Invest Today!

Investing in property overseas can be a nerve-racking ordeal, but you can also enjoy good returns. Expats in Portugal for example benefit from some of the globe’s most beautiful locations and best climate conditions, but when it comes to planning for the future, there are certain considerations which may be masked by a general feeling of wellbeing amongst all the warmth and beauty. Don’t let complacency about your wealth management become a problem in later years – act now to prepare yourself for a more secure financial future.

Firstly, we must emphasise that before you ‘buy into’ a regular savings plan, or any financial product for that matter, you should seek trusted and professionally regulated financial advice. Thats why Ideal Homes is here to help you.

Over the last few years, there has been a lot of negative press and commentary about “mis-selling” of financial products, but, by educating yourself about what’s available and understanding whether certain products are suitable for your circumstances, you stand a better chance of benefiting in the long-run.

If you decide to invest in an overseas property, you can potentially benefit from alot of angles, lower upfront costs and more lenient eligibility criteria to qualify for a loan, Younger investors may need less deposit and less income to start their adventure. Generating additional cash flow in another currency exchange rate can be used to benefit your situation, However, remember that fluctuations in a foreign currency may also represent a risk. Strong capital growth and rental return. Especially in a well-located area, Portugal being top of the list.

As property is a physical asset that represents more than just minimal paper value, it has long been regarded as a good investment to protect yourself against the impact of inflation on your finances. When inflation occurs, house prices and rents increase, which is a great benefit for property investors. Personal and monetary value. As an investor, you have the flexibility to use the overseas property to suit your personal needs. The property itself can be used as a part-time residence or holiday with the added benefit of utilising the property while increasing in value with rental returns.

Tax benefits. Depending on your income, overseas property investment can have benefits at tax time. Seek an accountant’s advice for more information about any tax or depreciable items you can claim, Foreign residency. If you own an overseas property, this may increase your chance of qualifying for residency in the country. Portugal for example is now offering the Golden Visa.

Most banks and building societies provide regular savings accounts offering a higher rate of variable interest than current and basic accounts. Typically, you agree to pay in a fixed amount per month, with a limit on the savings balance accruing the higher rate of interest. Plans may be for a fixed term and/or with a fixed rate of interest.

At the end of the plan, or when you want to cash in your savings, you will get all your money back along with any interest accrued. Generally, you’ll have access to your money – some accounts may require you to save for a fixed term or you might need to give notice, otherwise a fee might be payable or you lose out on the higher rate of interest.

The downside to these savings plans is that the opportunity for growth and returns is limited.

Also sometimes known as endowment policies, you can buy this type of investment product from a life assurance company. You will be required to save a regular monthly amount in return for a lump sum at the end of the policy, backed by a life insurance payout if you die.

These plans can be used for a number of medium to long-term savings goals, including (often in the past) to buy property (endowment mortgage). They can also be used for general savings which will pay out a lump sum at a specific time.

You pay a certain amount per month into the plan – part of this payment buys life assurance, while the rest is invested into various types of assets; typically shares, government gilts and bonds, property investment funds and fixed-interest investments.

This type of regular savings plan will aim to provide greater growth than a bank or building society account, but the returns are not guaranteed and you may not get back all your savings. However, if you need to grow your money to fund your retirement or to provide a legacy, this type of plan could be more beneficial.

The tax payable on savings will depend on your personal circumstances as well as your place of residence and domicile. There could be significant tax savings to be had with a regular savings plan. However, it is important for your financial adviser to have a full understanding of your personal circumstances before tax obligations and any tax savings associated with a particular product can be established. If your retired, Portugal offers an income tax rate of 20% and 10 years of tax free pension payments.