Banking Challenges

We have been researching the best way to do our day to day banking while in Thailand.

The US government puts unrealistic demands on foreign financial institutions to report every baht/peso/yen that an American citizen keeps in bank accounts in a foreign country with severe penalties to the foreign financial institution if they don't comply.  This has resulted in many financial institutions in foreign countries closing and/or refusing to open accounts for American expats.

Fortunately for us we won't need to have a Thai bank account to qualify for our retirement visa and extensions to stay in the kingdom. Moving the $25K or $26K into a Thai bank account to qualify for a retirement visa raises eyebrows at the IRS.  Since we will be able to qualify for the retirement visa with letters of income from our retirements and social security rather than deposited funds in a Thai bank we won't wave the offshore accounts flag to the IRS.

Thailand, like many Asian countries, is a cash based society.  You can use debit cards and credit cards in very few locations.  Cash is King.



So, how do we get cash to live with while we are there?

ATM's are everywhere in Thailand.  The problem becomes the fees associated with each transaction.  Most charge a 150 baht fee ($5 US) for each withdrawal.  Then there is the foreign transaction fee that your home bank charges which ranges from 1% - 3%.  On the maximum withdrawal of $500 that would range between $5 and $15 per transaction in addition to the $5 ATM fee.  You can easily see that making several withdrawals per month for living expenses the fees can add up in a hurry and we would rather spend it on curry.



Enter Charles Schwab Bank and their High Yield Investor Checking account.  This is tied to Schwab One Brokerage account, which amazingly doesn't need to have a balance.  With the High Yield Checking Account we get FREE use of any ATM worldwide.  That's right.  If we are charged an ATM fee Schwab will refund it back into our account.  Cool, huh?

But wait!.....there's even more.  Schwab does NOT charge any foreign transaction fees.  WHAT!?  That's right....no foreign transaction fees either.  Hello more curry dishes.

So we opened our account with Schwab this week to get prepared for the upcoming move. We also felt it would be prudent to keep another degree of separation between the bulk of our savings and any possible problem if somehow our account got compromised.  So we are still going to have all of our deposits from our retirement accounts and social security direct deposited into our existing credit union.  Then we will electronically transfer just the funds we need into the Schwab account and withdraw them in Thailand.  And the transfer between our credit union and Schwab is free.