Are Swiss Bank Accounts Really Worth It?

Swiss bank accounts are not a great benefit to account holders investors, or money managers in so far as today's increasingly globalized financial markets offer the same or similar benefits in many other places for similar costs. Not only do most developed countries have functional banking systems of their own, they may also offer better deals, banking policy, incentives and yields to stay competitive.

Additionally, Swiss banks do not offer the localized banking services that quite often meet the needs of the community they serve. Consequently, local banks outside of Switzerland, may be just as affective in delivering banking services to their community as are Swiss banks to the International Banking Community. Furthermore, geographically, politically and culturally, domestic banks and banking services are likelier to be easier to access in terms of logistics, communications, and services such as loan processing.

Advantages of Swiss bank accounts

• Services 

Swiss banking and financial services are a major part of the Swiss economy. It has traditionally been known for banking security for decades. This makes Swiss banking a sought after service for those seeking security of their financial assets. As per the reputation of Swiss banks, investors can generally expect to have their money treated professionally, with dignity and with respect when in the hands of a Swiss bank.

• Yield 

The Yield on a Swiss money market account can be as high as 5% on U.S. Dollars according to http://swiss-bank-accounts.com. This yield is pretty good as far as dollars are concerned as money market accounts in U.S. markets don't earn nearly as much as this.

• Privacy 

Due to the privacy laws which are still in place in Switzerland, one can generally enjoy privacy of financial information to the extent that such privacy does not amount to suspicion of criminal activity.

• Security 

Switzerland is a politically neutral country for the most part. Since it does not overtly ally itself with any foreign power or force, its assets are somewhat protected from a political clash of nations that could involve the demise of economies. In other words, if one's own country is politically unstable, a Swiss bank account may be a wise choice.

Disadvantages of Swiss bank accounts

Having illustrated some of the advantages of Swiss bank accounts, there still are a few disadvantages that can be associated with them. These disadvantages can be considered significant enough to outweigh the benefits of Swiss banking if one is a foreign investor.

• Low yield standard accounts 

The standard Swiss bank accounts have considerably lower yields than the money market accounts in foreign funds. For this reason, it may not be beneficial to invest in Swiss Francs unless their purpose is as a potential hedge against another currency.

• Inconvenient 

Even with a globalized world that is connected via internet and low cost long distance communication, having assets on another continent, country or across an Ocean can be a legal, taxation, and bureaucratic headache.The enhanced banking service available at Swiss banks may simply not outweigh the convenience of banking locally.

• Comparable investment yields 

While a Swiss money market account may yield more in US. Dollars than an American money market account, a similar yield can be achieved through other investment vehicles such as Certificates of Deposit. The money may be tied up for a little longer, but loans can be taken out against CD's and CD's aren't 100's-1000's of miles away.

• Privacy not unique

Privacy is an important part of Swiss banking law, but it is also a general principal for many other banks in other countries. The privacy and legal protection offered to customers of non-Swiss banks, may find their privacy protection is suitable as is. Additionally, off shore accounts in the Caribbean and other global locations offer comparable privacy regulations.

Summary

For the most part, a Swiss bank account can be thought of as a premium bank account with special service and treatment but not much more than that. The interest yields can be obtained through other investments and the fees for services provided by Swiss banks may reduce the benefit of such yields. 

What's more the privacy Swiss banks are so noted for can be compensated for with such tools as credit agency freezes, cash expensing, and localized private banking. Unless someone has specialized or unique banking needs a Swiss bank account is generally not necessary and/or worth it by common banking standards.

Sources:

1. http://swiss-bank-accounts.com/e/banking/general/interest_currencies.html
2. http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=43349
3. http://switzerland.isyours.com/e/banking/faq.html