There have been several discussions, especially on South African expat forums, about financial emigration. The initial thoughts of most anyone considering this course of action is one of apprehension and fear. After all, financial emigration sounds so final. It seems like you are cutting those few remaining ties with your home country something which, understandably, makes you anxious.

There are, however, several reasons why financial emigration may be a suitable option for you. And despite what you may think, financial emigration does not affect your South African citizenship, nor does it bar you from making and moving money from South Africa. So here are a few things which may make you reconsider financial emigration.

 

Financial emigration does not affect your citizenship

Irrespective of where you are in the world, you are still a South African. Making the decision to emigrate financially will not affect your citizenship status. It simply implies that you are no longer a financial resident of South Africa ­ which means a different set of exchange control rules will regulate how you move money out of the country.

You can still make, and move money from South Africa

Financial emigration does not bar you from making money in South Africa or moving money out of the country. If you have assets left in South Africa, they can still generate an income, but your finances will, from now on, be regulated by a banking institution via a capital bank account (previously known as a blocked account). This account does not ‘block’ your money ­ it simply means you now have a single account through which your money can flow easily, out of South Africa.

If you have a retirement annuity, it’s your best choice

If you have a retirement annuity in South Africa, you can surrender it and transfer the funds offshore, irrespective of your age, for a significant financial boost. In most cases, early surrender of a retirement annuity is not an option for South African expats who haven’t financially emigrated. But if you’re starting a new life abroad, chances are you probably don’t have surplus cash lying around. By surrendering your retirement annuity you have the freedom to spend your money to assist your move or you can reinvest the money offshore to earn interest in a stronger currency.

If you’re planning on staying abroad ­ financial emigration makes sense

For those who’ve opted for permanent relocation, financial emigration simply makes sense from an administrative point of view. A capital bank account simplifies your finances back home as the account is managed by a single banking institution. You will no longer have banking fees linked to online accounts or cards and you won’t have multiple accounts to manage remotely.

If you’re still wondering how financial emigration will affect you, why not talk to a finglobal consultant about your needs. Our initial consultation to you is free of charge, which means we’ll give you sound advice on your financial options after which you can decide on a course of action.