Transferring money to overseas banks for personal use

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Topic Author
Nowisee
Posts: 15
Joined: Sun Mar 03, 2019 8:18 pm

Transferring money to overseas banks for personal use

Post by Nowisee »

Advice about which method to transfer and keep money in overseas bank.

There’s a lot of smart and experienced people on here and I’ve enjoyed spending hours reading various threads.
If you can take the time to help me look at this from the right or different perspective(s) so I can see it differently and make a logical decision I would be greatly appreciative.

You’re required to put money (800,00 baht or approx. $27,500) in a foreign countries banking system (Thailand) for immigration purposes. It needs to be in the bank for about 5 months at which time you can use half of it, the other half must remain.

It can be in USD in a FCD account (Foreign Currency Deposit) or it can be in the local currency in a savings or fixed deposit account.
Both carry fees, but not enough to make a big difference.

The FCD account has 0.15% APY, the savings accounts can pay up to 1.6%.
Transferring the money in, the local bank charges 0.25% of the amount, maximum 500 baht ($16) and transferring using SWIFT, Charles Schwab no charge.
Transferring the money from the FCD account to the savings account (for local currency spending) is pretty easy and fee free.
Transferring the money out into USD is a 1% fee.
Transferring the money (outward remittence) is 0.25% on the amount, no maximum. $27,500 = $70 approx.

Would you transfer the money in as local currency and take the hit on the exchange rate? I ask this because currently the baht is strong to the USD and at 30.30 and seems to be going down. Oct/Dec it was about 33 baht to the USD.
OR
Transfer it in as USD, park it there until either you leave the country and take the money back out or until the the baht weakens (rises) and comes closer to 33 or higher, at which time you could move it over to the savings account.
In the past, I have transferred money in to make larger purchases $5000, but I have never transferred money out. Worse case scenario I take it out in USD and hand carry it to USA.
There is the acknowledgment, whether you use this money, a credit card or a debit card, you’re still converting at the current exchange rate when you spend.

I’d love to hear thoughts and ideas and engage in some dialog and answer any questions.
codedude
Posts: 70
Joined: Thu Jan 26, 2017 9:15 pm

Re: Transferring money to overseas banks for personal use

Post by codedude »

Nowisee,

You can figure out the costs of a particular strategy.

But what is more important is - taxes and reporting.

Taxes: Assuming you are a US taxpayer, any year you have at least one bank account in an overseas bank in which the balance at any time during the year is over $10,000, you need to report all your overseas bank accounts with an FBAR filing. The filing itself is easy, the penalties for not doing in a timely fashion are high.

Reporting: If you decide to hand carry any amount over $10,000, you need to report it to US customs and possibly Thai immigration. Failure to do so can land you in trouble.
sfnerd
Posts: 208
Joined: Tue Apr 08, 2014 1:16 am

Re: Transferring money to overseas banks for personal use

Post by sfnerd »

What bank are you using?

I live in Bangkok. I work here, so no holding requirements for me. For the 800k THB, I would just transfer it to THB here, and hold it in Baht in a bank like SCB or Citibank Thailand. You are probably going to be using a lot of it, and the baht is pretty stable in general. Keeping dollars here doesn't make a lot of sense if you're American, as you will have much lower fees back home. Just keep the 800k here in baht and keep everything else in the US. It's good to be a bit diversified if you live here, because as mentioned, the baht has been strong against the dollar. Of course, which way it goes in the future is anyone's guess. I keep about a million baht (30k USD) in baht at any given time, which covers upcoming expenses for a while.
Topic Author
Nowisee
Posts: 15
Joined: Sun Mar 03, 2019 8:18 pm

Re: Transferring money to overseas banks for personal use

Post by Nowisee »

sfnerd wrote: Sat Sep 14, 2019 11:13 pm What bank are you using?

I live in Bangkok. I work here, so no holding requirements for me. For the 800k THB, I would just transfer it to THB here, and hold it in Baht in a bank like SCB or Citibank Thailand. You are probably going to be using a lot of it, and the baht is pretty stable in general. Keeping dollars here doesn't make a lot of sense if you're American, as you will have much lower fees back home. Just keep the 800k here in baht and keep everything else in the US. It's good to be a bit diversified if you live here, because as mentioned, the baht has been strong against the dollar. Of course, which way it goes in the future is anyone's guess. I keep about a million baht (30k USD) in baht at any given time, which covers upcoming expenses for a while.
I've been using Bangkok Bank 7 years. I live in Chiang Mai.
Definitely, I keep it all in the US and diversified in other asset classes.
You work here so your income is paid in baht. It would makes sense that you keep it in baht.
I'm trying to avoid the hit on the exchange when I send a larger amount ($27,500) over.
Most of my purchase are taken care of using credit card, I do an ATM pull 25k baht for cash spending money about every 2 months.
The money I would use is currently in a MMA earning 2%, no fees.

Why does keeping it in USD here not make sense?

Thanks
sfnerd
Posts: 208
Joined: Tue Apr 08, 2014 1:16 am

Re: Transferring money to overseas banks for personal use

Post by sfnerd »

Because usually the dollar accounts here have big fees. Extra on the way in (in addition to your bank's fees) and on the way out (usually 1% plus). Often the banks have other maintenance fees and such. I'm not sure about Bangkok Bank, but Citi has fees unless you hold a large sum there, many million THB.

Since your expenses are in THB, I would just keep the money in THB there, and transfer in at a low fee using your bank or Transferwise (this used to be really cheap inbound to Thailand; I transfer the other direction though so it doesn't work for me).

This way you have low fees and some local currency exposure. And you don't have the risk of the USD continuing to depreciate, which might put your holding requirement at risk.

Wat dee khrap :)
Topic Author
Nowisee
Posts: 15
Joined: Sun Mar 03, 2019 8:18 pm

Re: Transferring money to overseas banks for personal use

Post by Nowisee »

Sa wad dee khrap

No charge SWIFT using Schwab, BKB inbound fee is .025% max 500 baht. Transfer to baht account free, outbound transfer .025% no max. The 1% only applies if you want to take out USD. No other fees except maintain $250/month.

Valid point about my expenses and for this I will transfer from USD to Baht as needed and the risk of the USD depreciating and the immigration requirement actually going below the 800k.
Using BKB linked with Citi back to Schwab.
It's the large (800K baht) transfer that I want to avoid...with the thought of a weakening baht back up to low or mid 30s. I'm also considering this being my last year here, so I will never spend 800k in a year, don't care if my balance falls below the 800k and transfer the rest back in USD and not have to convert first (taking a second hit on exchange).
Maybe do half and half. :)
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