Have you ever wondered about the secret source of financial stability? Is it a Monthly Savings Plan?
“Saving consistently is the key to wealth accumulation” Warren Buffet
Let’s Find the Best Monthly Savings Plan
A Monthly Savings Plan comes in many shapes and sizes. The best plans for savings take into account your financial situation, goals, and risk tolerance. A Monthly Savings Plan is designed to help you achieve your financial objectives, whether sending your child to university or retiring comfortably.
Living as an expat brings its own set of challenges and opportunities. Investment and savings don’t have to be one of them!
The scope of offshore investing is vast, offering numerous savings options, investment plans, and tools, but navigating it requires expertise.
When considering a monthly saving plan, it’s vital to differentiate between offshore and domestic options.
For expats living abroad, offshore plans often present unique advantages that domestic plans might not offer.
Offshore plans can provide access to global markets, potentially favourable tax treatments, and a diverse range of savings options.
The Spectrum of Savings Options
From high-yield savings accounts to investment-backed saving portfolios, the range of savings options is vast.
Each offers its own set of unique benefits, interest rates, and potential risks and potential returns.
When deciding which one is for you, consider your financial goals, time frame, risk tolerance, and how involved you want to be with your investments.
Best Plans for Saving: Why Dedicated Savings Matters
Investors Trust S&P 500 Capital Guaranteed Account
The Investors Trust S&P 500 Capital Guaranteed Account is a beacon of transparency and simplicity.
It not only provides a safety net with its capital guarantee but also boasts impressive potential for growth.
It is widely regarded as one of the best plans for savings, especially for those wanting to safeguard their principal amount while enjoying market-linked growth.
The S&P 500 plan tracks the 500 largest companies listed through the American Stock Exchange. Companies live Chevron, Apple, Amazon & Microsoft. The S&P 500 has grown at an average of 10% annually since its conception in 1957. Currently, there is over $33 Trillion invested in the index.
This plan gives you a minimum of 140% capital guaranteed protection when you invest over the medium term.
What investors like most about this plan is that you can overpay the contributions, which buys you future flexibility, unlike most other savings vehicles. If you stay one year ahead of your payments, this will allow you a full year of zero contributions in case the unexpected happens.
Ardan International: Your Flexible Friend
Ardan International stands out as a wealth platform offering a vast range of assets and investments. Their platform facilitates easier management of international financial portfolios, giving investors the freedom to choose their preferred assets.
Their main draw? Attractively low fees. However, there’s a caveat: they don’t promote or require a consistent saving habit.
Without the commitment to save regularly, many individuals fail to hit their targets, focusing too much on flexibility instead of the more significant picture of reaching your goals.
If you are 100% diligent and can trust yourself to invest every month, then Ardan is an excellent choice if you want complete flexibility from your investment platform. But, going back to Warren Buffet’s earlier point: “Saving consistently is the key to wealth accumulation”
Old Fashioned Financial Advice
Here, we will look at three different types of investments you may or may not be familiar with that could change the way you plan your finances.
Generali, Skandia, RL360, Friends Provident: A Case Study
These three investment providers are a popular choice among expats, mainly due to them being popular choices with expat advisors.
These plans have large fund ranges to choose from. Each plan has high-quality funds for your money to grow and has been the staple of the old offshore world.
However, they’re notorious for their high fees, which are very difficult to understand and are presented in a complicated way that makes them look affordable.
My advice is only to commit yourself to the minimum investment period of five years. Invest a sizeable amount to take advantage of the “allocation bonus”. The more you invest, the bigger the bonus.
This way, these plans will work well for you and will build you a sizeable pot of money that you can invest into something more complex like a Personalised Portfolio Bond on the completion of the five-year term.
Do not invest in these plans with a twenty-five-year time horizon.
Offshore vs. Domestic
- Domestic Savings Plans: Rooted within one’s country of residence, domestic savings options offer familiarity. They operate within known regulatory frameworks and are generally perceived as low-risk.
- Offshore Savings Plans: Venturing outside one’s country, an offshore savings and investing plan can offer potential tax advantages, diversification and access to international markets.
By investing in an offshore monthly savings plan, you’re not limiting yourself to a particular market or region.
You’re diversifying your portfolio, reducing risk, and potentially enhancing your returns.
The Power of Commitment
There is no “silver bullet” or “magic investment”. The success of your investment must first lie with the investor to commit themselves every month to saving an agreed amount and then maintaining continuity.
Making the Most of Your Savings: Expert Tips
- Start early to leverage the power of compound interest.
- Automate your savings.
- Review and adjust your plan annually.
- Diversify your savings and investments.
- Understand the potential of a monthly savings plan.
The Magic of a Regular Savings Calculator
The regular savings calculator isn’t just a fancy tool; it’s your roadmap to financial success.
By inputting your financial details into a financial calculator you can project your future savings and adjust your plan accordingly. A good advisor should be doing this in his regular reviews with you.
The Role of a Financial Advisor
As an expat financial advisor, I can’t stress enough the value of professional guidance. We are here to guide you through the difficulty of choosing the right monthly savings plan, helping you pick the plan that aligns with your goals.
How Flexibility in Savings Plans Affects Investments
Flexibility can be both an asset and a pitfall. While it allows for adaptability in changing financial circumstances, excessive flexibility might lead to erratic contributions, affecting the compound growth of savings. Furthermore, consistent contributions can provide a sense of financial discipline and security.
Albert Einstein once said: “Compound interest is the eighth wonder of the world. He who understands it earns it; he who doesn’t pays it”
A Monthly saving plan offers a structured approach to building wealth over time. By understanding the spectrum of options available, the benefits of regular contributions, and the features of the best plans, you can make an informed decision and secure your financial future.
With knowledge, tools, and guidance, you can harness the power of offshore investing, ensuring your hard-earned money grows. No matter where you are.
Frequently Asked Questions (FAQs)
What is the main advantage of an offshore monthly savings plan for expats?
Offshore plans often offer better tax treatments, access to global markets, and diverse investment options tailored for expats.
How do high fees impact my monthly savings plan in the long run?
High fees can erode your potential returns, especially when compounded over time.
Why is commitment essential in a monthly savings plan?
Commitment ensures consistency, which is vital for meeting long-term financial goals.
How does the regular savings calculator help my monthly savings plan?
It provides a projection of your future savings based on your current financial habits, helping you make informed decisions.
Why should I consider the advice of a financial advisor when choosing a monthly savings plan?
Financial advisors have the expertise to guide you through various savings options, ensuring you choose the best fit for your goals.