Section 3

Benefits of Internationalizing Yourself

This void may also be a result of the lack of demand for the need to know. Rich, internationally diversified individuals have long exercised the offshore angle, but only now does it truly make sense for smaller investors with less capital and less diversified portfolios to consider the same possibilities.

Here are some of the numerous reasons and benefits why an investor today needs to consider investing from offshore. Each individual will recognize advantages that will fit their own circumstance.

Investment Opportunities

International investing is more than purchasing shares in an international mutual fund. Americans often diversify their portfolio internationally by simply investing in an American managed mutual fund that invests in foreign or foreign and U.S. companies. A small investor can benefit from international investments in this way and rest well, knowing that professional managers with knowledge of foreign opportunities and risks are at the helm of their investment. These funds are well publicized in the United States and include names such as Dean Witter World Wide Investment Trust; Fidelity Overseas Fund; Financial Group Pacific Fund; G.T. Pacific Fund; Kemper International Fund; Keystone International Fund; T. Rowe Price International Recovery Fund; Prudential-Bache Global Fund; Putnam Global Growth Fund; Scudder International; and Templeton World Fund. Returns fluctuate with the economy, but 6 percent to 15 percent annually are common, or double to better what U.S. banks are paying American CD holders.

Now for the but. There are funds located and managed from all over the world. Some of these funds produce returns upwards of 60 percent and more per annum. Most Americans have probably never heard of these funds. Why? As stated previously, there are three strong reasons.

1. It is not worth the trouble and expense for foreign companies to expand operations into the U.S. market due to heavy regulations (i.e. SEC).

2. They cannot meet strict SEC and other U.S. governmental regulatory bodies to offer their investments in the states. This does not mean these are not good investments, but they do not meet the United States government's idea of acceptable standards.

3. If more Americans realized that greater returns are possible, in some cases sizeable annual returns, whether investing in CDs, stocks, bonds, or whatever, they would likely be inclined to move their money out of fragile U.S. banks and U.S. systems that Americans are forced to accept. Therefore, many of these foreign investment opportunities are not legally permitted to advertise in the United States and are not promoted here. That is why, for example, the popularity of U.S. managed international and global investment funds.

As an offshore investor these common barriers disappear. Utilizing an offshore corporation for investments turns the American investor into a global animal. This rare breed can invest in international funds, companies and banks that might otherwise be prohibited to other Americans.

Here are a few sources for funds and investment opportunities that cater to foreign readers, but should be explored by American investors.

In the U.S. or Canada, write or call:

International Herald Tribune
850 Third Avenue
New York, NY 10022
U.S. Toll-Free (800) 882-2884
Canada Toll-Free (800) 535-8913
or FAX (212) 755-8785

A daily international newspaper published in English and available through better U.S. bookstores or by subscription. Although a French paper, there is an edition printed in New York. Aside from daily investment advertising, the Saturday-Sunday issue quotes major funds from around the world and their phone numbers and addresses for contact. An invaluable publication for the international investor.

Other interesting publications include:

International Fund Investment (quarterly)

International Herald Tribune, Simon Osborn
181 Avenue Charles-de-Gaulle
92521 Neuilly Cedex, France
or FAX 33 1 46 37 21 33

London's daily financial newspaper:
Financial Times

FT Publications
14 E. 60th Street
New York, NY 10022

The International: A Worldwide Guide Personal Finance
Write for free subscription:

The International Boundary House
91 Charterhouse Street
London EC1M 6HR, United Kingdom

Offshore Financial Review (monthly)

Greystoke Place, Fetter Lane
London EC4A 1ND, United Kingdom

The Economist (weekly magazine)

The Economist Newspaper, Ltd.
10 Rockefeller Plaza
New York, NY 10020

Fund Management International

IBC Limited
Bath House, 56 Holborn Viaduct
London EC1A 2EX, United Kingdom

Confidentiality and Secrecy

In the U.S. there is no financial privacy. Scores of records are maintained on every American by computers. This information is seldom used by others to your benefit. The offshore investor is immediately protected from preying eyes, information snoops, government intrusion and other unwarranted and unwelcome invasion of your privacy. Total confidentiality is secured in numerous ways with the use of an offshore corporation and foreign bank account.

Asset Protection

By investing through your own offshore corporation you gain superior asset protection. All the investments and other assets of the corporation are removed from reach of U.S. and foreign creditors, lawsuits and seizures. In order to implement any legal proceeding the instigating party would have to initiate proceedings in the country of incorporation, bearing the full expense of their action, and then discover that the claims being made may not be recognized by the tax haven courts.

Tax Reduction

Although every U.S. citizen is obligated to file a tax return with the U.S. government regardless of where they live or where the income or profit is derived, they can substantially reduce their tax liability through international tax planning. One interesting note to ponder is that U.S. citizens living abroad are exempt from tax on the first $70,000 of personal income.

Avoid Unnecessary Government Bureaucracy

Citizens are usually the subjects of their own government's regulations, taxes, bureaucracy, dwindling liberties, and more. Every reader is capable of making their own list of inherent drawbacks. But the offshore investor, even if physically living in the United States as a U.S. citizen, can attain greater freedom, privacy and control over their business, financial and investment sides of life by simply choosing to manage these aspects through one of a handful of excellent offshore bases.

These are just a few of the more significant reasons for going offshore. Other motivating factors include capitalizing on international developments, profit from emerging business opportunities, experiencing foreign cultures, justify international travel, expose yourself to new ideas, minimize risks to shaky financial institutions and governments, comfortably prepare for the future.

Start today by contacting CRA. We provide incorporation, management and other business support services in all major tax havens and banking centers worldwide. Telephone (702) 243-1950, fax (702) 243-6896 or email: info@craofamerica.com.