Retiring with Cash
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Retiring with Cash
How safe are Cambodian banks? I am thinking of retiring in Cambodia, after having worked in Korea for the last 25 years, and have a substantial amount of cash. With extremely high interest rates be offered by Cambodian banks would it be utterly foolish to put say US $200,000 or $300,000 in term deposits? I need to take my money out of Korea and would prefer not to put in a bank in my home country Canada. Is it even possible for me to open account on a 1 year regular visa? Please note I am not real comfortable with putting my money into stocks or bonds. I'm quite conservative in this regard.
Thank you!
Thank you!
Good question Wallace, and one that is often raised. At the end of the day it will depend on your attitudes to banks in general and Cambodian banks in particular.
I personally have no problem with Cambodia's banks and MFIs, and am currently in the process of doing what you are doing: shifting chunks of cash to take advantage of the relatively high interest rates. I'm aware of several 440ers who sleep fine at night holding six figure sums here.
You will find that the very highest rates are paid by the MFIs like Prasac. Some of our more business-oriented posters regularly say that they think the MFIs are better run and managed than the banks. It's certainly something I'm looking into to.
As to your question re accounts on a 1 year regular visa. No problem. The only one Im aware of that requires jobs etc is ANZ, but they generally offer the lowest rates on the market.
I personally have no problem with Cambodia's banks and MFIs, and am currently in the process of doing what you are doing: shifting chunks of cash to take advantage of the relatively high interest rates. I'm aware of several 440ers who sleep fine at night holding six figure sums here.
You will find that the very highest rates are paid by the MFIs like Prasac. Some of our more business-oriented posters regularly say that they think the MFIs are better run and managed than the banks. It's certainly something I'm looking into to.
As to your question re accounts on a 1 year regular visa. No problem. The only one Im aware of that requires jobs etc is ANZ, but they generally offer the lowest rates on the market.
MFi will get you 10% ++ on that amount. Enough to live on.
Rated R for Ricecakes
As far as I know, too, you can negotiate the Cambodian national rate of taxation at source on the interest rather than the higher rate applied to foreigners with a 1-year visa/housing/work contract etc.
RobW wrote:As far as I know, too, you can negotiate the Cambodian national rate of taxation at source on the interest rather than the higher rate applied to foreigners with a 1-year visa/housing/work contract etc.
Easily done. I get the taxed at the lower rate. I simply told them I was a resident here, showed them my visa and they changed the tax rate on their system immediately.
On ricecake's point re getting 10% interest, that would be at one of the smaller MFI's and likely only on riel term deposits over up to 2-3 years maturity. Nothing wrong with that of course, but the risk factors need to be considered. The key one would be currency risk if you wanted your return in USD, but my sense is that the dollar riel relationship has been pretty steady over the last few years, and - of course - you could gain as well as lose.
Don't be tempted to much... Most banks in Cambodia do not publish any yearly reports, or reports published are from 2011/2012, so judging them is hard if not impossible. If I were you I would send some handy cash to Cambodia, say 50.000$, spread it amongst several banks (AMK, Saphtana, ACLEDA, ANZ, Canadia), and keep the rest in a save foreign bank. Don't forget a major bank like ACleda only offer like 0,5% on a simple savings account.WallaceScott wrote:How safe are Cambodian banks? I am thinking of retiring in Cambodia, after having worked in Korea for the last 25 years, and have a substantial amount of cash. With extremely high interest rates be offered by Cambodian banks would it be utterly foolish to put say US $200,000 or $300,000 in term deposits? I need to take my money out of Korea and would prefer not to put in a bank in my home country Canada. Is it even possible for me to open account on a 1 year regular visa? Please note I am not real comfortable with putting my money into stocks or bonds. I'm quite conservative in this regard.
Thank you!
High interest rates means high risks as well.... How high is hard to judge here.
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Another point maybe worth considering from a risk standpoint is staggering your fixed deposits over quarterly terms, 3 months, 6 months, 9 months a year. You'll sacrifice a bit of return but will also allow you to gradually withdraw should you feel the need.
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Check out VisionFund for good rates and a safe (for Cambodia) risk profile. As scobie said, probably better run than a bank, full accounts are available etc.
My only concern would be depositing in KHR to get that extra % - I would not want to take the FX risk that there is some kind of crisis (political, revolution, coup, whatever) that drives a devaluation in the KHR Riel.
Stick to USD in my view unless you are comfortable with the currency risk.
My only concern would be depositing in KHR to get that extra % - I would not want to take the FX risk that there is some kind of crisis (political, revolution, coup, whatever) that drives a devaluation in the KHR Riel.
Stick to USD in my view unless you are comfortable with the currency risk.
??? - in which case you were lucky. Most financial institutions in Cambodia require that either 1) you have a current work contract or 2) have already been in the country for 182 days before offering the residents' rate.scobienz wrote:RobW wrote:As far as I know, too, you can negotiate the Cambodian national rate of taxation at source on the interest rather than the higher rate applied to foreigners with a 1-year visa/housing/work contract etc.
Easily done. I get the taxed at the lower rate. I simply told them I was a resident here, showed them my visa and they changed the tax rate on their system immediately.
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Great to know you're not exploiting loopholesscobienz wrote:Easily done. I get the taxed at the lower rate. I simply told them I was a resident here, showed them my visa and they changed the tax rate on their system immediately.RobW wrote:As far as I know, too, you can negotiate the Cambodian national rate of taxation at source on the interest rather than the higher rate applied to foreigners with a 1-year visa/housing/work contract etc.
ירי ילדים והפצצת אזרחים דורש אומץ, כמו גם הטרדה מינית של עובדי ההוראה.
I'm not exploiting loopholes. I have a work contract, the right visa and I am tax resident here, all of which entitle me to qualify for the lower tax rate.vladimir wrote:
Great to know you're not exploiting loopholes
Had they asked to see them, I could have shown them. But they didn't.
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