The main idea behind investing in a multi-currency bank account is maintaining the value of your hard money even during weak economic times. With this account you can easily exchange the money in a particular currency. In short, it is the most simple and easy way to diversify the dollar while having a single account number. Many banks who offer foreign currency bank account give the custo
mers an option of wide range of currencies such as US Dollars, Canadian Dollar, Euro, British Pounds, etc. Many banks even have a provision for keeping gold in the account.
Advantages:
There are numerous advantages of holding this type include:
- It is ideal for people who are involved in a lot of foreign currency payments in form of shares, dividends, selling and buying of real estate property or for people who send out money to their families in different part of the world. With this bank account you can easily wire money in and out in different currencies.
- Easy to handle as for all the currencies you have to maintain only a single bank account number and using that all the transactions in various currencies are done.
- You can convert any amount of money in a particular currency. This comes in handy when a particular currency sees a downfall in the market due to the fluctuating economy thereby it reduces currency risk and you don’t lose your hard-earned money.
- Many banks offer low conversion or exchange rates if you frequently convert in a particular currency. This feature makes transaction for business person and industrialist working across the globe easy and cost-effective.
- Such banks also give an option of depositing surplus funds without the cost of converting or exchanging them to sterling.
- In addition to this, you are also entitled to competitive interest rates against most of the currencies. However, this feature is available only for deposit account and not for current account.
Apart from these features the banks offer monthly statements, drafts, electronic transfer and foreign transfer. You don’t have to maintain a minimum account balance for such accounts. In short, you enjoy most of the features of a normal bank account and in addition to some extra b
enefits. The benefits of the foreign currency account vary from bank to bank and the cost of opening a bank account varies acro
ss the globe. Read the terms and condition of the bank before making a final decision.
Banks often incur additional costs for administrating and maintaining a multi-currency bank account and you might be charged extra in the name of banking services. And, because of this reason banks generally look for customers with higher net worth or customers who transact a lot in the various currencies. Also, American citizens who wish to have a multi-currency account have to declare this fact to the IRS that is the monitoring organization for such banks. To avoid any confusion on a later stage, it is best to get this doubts cleared from the bank.