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Offshore Banking 101—It Starts With The Right “Back Home” Banking Support
By Kathleen Peddicord

In today’s world, it is possible to manage all your administrative and financial functions virtually…from anywhere.

Possible, but not always easy.

How can you be sure you’ll be able to access an account, get cash, move money, or pay a bill when you need to from wherever you happen to be atthat time? How can you make these critical functions hassle-free rather than a big pain in the neck and even, potentially, a restriction on how you’re able to live your life and move around the world?

A first key is where and how you bank “back home.”

You probably already have internet banking set up to check account balances and maybe even to pay bills online wherever you’re living now. Ifyou don't, that's the first step. Go to your bank's website and follow the instructions. If you find that your bank doesn't offer internet banking...switch banks. This is not negotiable. You don't want to relocate to another country without the ability to access your “back home” bank accounts online.

Specifically, you want to be able to move money (from one account to another or from one countryto another, via wire transfer, for example) and to pay bills remotely and electronically. These are the critical criteria, and, again, if your current bank doesn't offer these services, find a new bank that does. You can’t put yourself in a position of being required to show up at your local branch to authorize a transaction or to transfer funds from one account to another. How are you going tostop in at your bank in Des Moines to approve an account transfer if you happen to be in Buenos Aires at the time you need the transfer to happen?

Additionally, you don't want to rely on a single bank. I recommend that you divide accounts between at least two banks, both with complete and unrestricted online access.

A friend who has spent the past year relocating his life and his businessfrom California to Panama City had an experience recently that reminded me of the importance of this strategy. You never want all your eggs in one basket. This fundamental rule applies to every aspect, big and small, of your financial life. In this context, the point is that you don't want all your available cash in one bank.

My friend worked hard and carefully to organize his new life in Panamain every regard...but he neglected to diversify his available cash between two banks in the States before he departed for his new life in Panama. For some reason that he still doesn't understand, about six weeks ago, his U.S. bank reset the password for his online access. Not a big deal to the bank. They mailed the new password to my friend at his U.S. address.

Really big deal for my friend whohad no intention of being at that U.S. address anytime soon. Meantime, he couldn't access his account online. He couldn't make bill payments. He couldn't wire funds where they needed to go.

He contacted his bank and asked if he could send wire instructions by fax, as he had urgent obligations to meet. No, the bank said. They don't accept wire instruction by fax. (Most banks don't; more on thisin a minute.)

My friend was able finally to sort things out without flying back to the United States (he managed to change his password again to something that he chose over the phone), but it wasn't easy and it took several days.

Access to your cash is key. With only one bank account and ATM card, you run the risk of being unable to withdraw cash when you need it.

Why You Need MoreThan One ATM Card

My friend's story is extraordinary. However, there are more common concerns. What if, for example, you find yourself in a place where the only available ATMs don't use the same network as your bankcard? This was fairly common when ATM machines first came out. It's less of a concern today, but, still, depending where you travel, it can be an issue.

Today, both most ATMs and...