How do multi-currency bank accounts work? What is the advantage?
Today typically a Business needs to hold accounts in more than one currency. Banks in certain countries are offering what is called a dual currency account. It is essentially 2 accounts with same account number but different currency. So One can have an account number say 123456 and have it in say AUD and USD. So the balance will always show as X AUD and Y USD. If you deposit funds [electronic, check or cash] in USD; your USD balance goes up. Likewise at the time of withdrawal you have to specify what currency you are withdrawing. Interest rates are calculated at different percentage for different currencies.  So in a nutshell it would like operating 2 accounts, with the advantage of remembering only one account number. Designate a particular currency as default currency. So if you don't quote a currency along with the account number, it would be treated as default currency. Otherwise you always quote the account number and currency. Of-course bundled with other services like free Fx Advice etc it makes the entire proposition very attractive. Edit: If you have AUD 100 and USD 100, if you try and withdraw USD 110, it will not be allowed; Unless you also sign up for a auto sweep conversion.  If you deposit a GBP check into the account, by default it would get converted into AUD [assuming AUD is the default currency]
The idea of an index is that it is representative of the market (or a specific market segment) as a whole, so it will move as the market does. Thus, past performance is not really relevant, unless you want to bank on relative differences between different countries' economies. But that's not the point. By far the most important aspect when choosing index funds is the ongoing cost, usually expressed as Total Expense Ratio (TER), which tells you how much of your investment will be eaten up by trading fees and to pay the funds' operating costs (and profits). This is where index funds beat traditional actively managed funds - it should be below 0.5% The next question is how buying and selling the funds works and what costs it incurs. Do you have to open a dedicated account or can you use a brokerage account at your bank? Is there an account management fee? Do you have to buy the funds at a markup (can you get a discount on it)? Are there flat trading fees? Is there a minimum investment? What lot sizes are possible? Can you set up a monthly payment plan? Can you automatically reinvest dividends/coupons?  Then of course you have to decide which index, i.e. which market you want to buy into. My answer in the other question apparently didn't make it clear, but I was talking only about stock indices. You should generally stick to broad, established indices like the MSCI World, S&P 500, Euro Stoxx, or in Australia the All Ordinaries. Among those, it makes some sense to just choose your home country's main index, because that eliminates currency risk and is also often cheaper. Alternatively, you might want to use the opportunity to diversify internationally so that if your country's economy tanks, you won't lose your job and see your investment take a dive. Finally, you should of course choose a well-established, reputable issuer. But this isn't really a business for startups (neither shady nor disruptively consumer-friendly) anyway. &gt;**Because if it is achievable**, it is almost certainly better than just tying the whole economy to the price of a single commodity. **If it is not achievable**, then it is almost certainly better to let the markets adjust and correct, however imperfectly, than to tie the whole economy to the whims and wishes of incompetent and politically-motivated money-printers.  So... what I'm getting from all of this, is basically how we view the possibility of a workable flat currency.  I think the possibility of whether or not a flat currency will actually work depends on many things, some more important than others. The size (and power/influence) of a country can greatly affect how a flat currency will work within that country.  If the country is large and power hungry (like ours), then a flat currency will most likely not work in the long run. It will promote greed and monopolization of wealth, but what of gold? That can't work either because a large country can't sustain itself off such an inefficient monetary system.  So... to me, it seems like extremely large countries should be split into smaller countries that can actually use flat currencies (or gold) without all of the potential for corruption.  This same sort of logic applies to our primate cousins. If a tribe of chimps gets too large, the group will split to relieve social tension.  This is a big part of why I support ideas like Cascadia.  Do you think there is a way for monetary systems to work in very large countries? "would it make sense to set up multiple bank accounts to avoid going above their thresholds?  Quite possiblly yes but you need to pay attention to the fine print. I don't know what the situation is in poland but in the UK accounts that pay high interest often have strings attached. For example the santander 123 current account pays very good interest but it has an account fee and some other requirements that are difficult to meet if you are not using it as your ""main current account"".  You need to read the terms carefully, if you go over the threshold does the lower rate only apply to money over the threshold? or does it apply to all the money in the account? Are there any other restrictions on how you use the account. Also I don't know if poland has any provisions for limited tax-advantaged savings (like the ISA scheme we have in the UK). If it does then that can add further complications. How to calculate how to maximize the profit here? Well in theory you would get the best account you can and fill it to the threshold. Then the next best account and so-on. You would move any interest paid in an account that was already full to the threshold to the best non-full account (or if the account strongly peanalises going over perhaps move an ammount of money equivilent to the interest just before the interest is paid). In practice that is a lot of work, so if the rates on the different accounts are similar you may want to leave some margin for interest or (in the case of an account that pays the lower rate on the overage while still paying the higher rate on money below the threshold) accepting that some of your money will earn slightly less than idea. Another option some accounts may offer is just to pay the interest to another account, avoiding the need to move it yourself. Finally you should check out your government's limits for compensation in the event of banks going bust. As a general rule you don't want to put more than that ammount in a single bank even if doing so would get you the best interest." To transfer US$30,000 from the USA to Europe, ask your European banker for the SWIFT transfer instructions.  Typically in the USA the sending bank needs a SWIFT code and an account number, the name and address of the recipient, and the amount to transfer.  A change of currency can be made as part of the transfer.   The typical fee to do this is under US$100 and the time, under 2 days.  But you should ask (or have the sender ask) the bank in the USA about the fees.  In addition to the fee the bank may try to make a profit on the change of currency.  This might be 1-2%.    If you were going to do this many times, one way to go about it is to open an account at Interactive Brokers, which does business in various countries.  They have a foreign exchange facility whereby you can deposit various currencies into your account, and they stay in that currency.  You can then trade the currencies at market rates when you wish.  They are also a stock broker and you can also trade on the various exchanges in different countries.  I would say, though, they they mostly want customers already experienced with trading. I do not know if they will allow someone other than you to pay money into your account. Trading companies based in the USA do not like to be in the position of collecting on cheques owed to you, that is more the business of banks.  Large banks in the USA with physical locations charge monthly fees of $10/mo or more that might be waived if you leave money on deposit. Online banks have significantly lower fees.  All US banks are required to follow US anti-terrorist and anti-crime regulations and will tend to expect a USA address and identity documents to open an account with normal customers.   A good international bank in Europe can also do many of these same sorts of things for you. I've had an account with Fortis. They were ok, there were no monthly fees but there were fees for transactions.  In some countries I understand the post even runs a bank.  Paypal can be a possibility, but fees can be high ~3% for transfers, and even higher commissions for currency change.  On the other hand, it is probably one of the easiest and fastest ways to move amounts of $1000 or less, provided both people have paypal accounts. Are there banks where you can open a bank account without being a citizen of that country without having to visit the bank in person? I've done it the other way around, opened a bank account in the UK so I have a way to store GBP.  Given that Britain is still in the EU you can basically open an account anywhere.  German online banks for instance allow you to administrate anything online, should there be cards issued you would need an address in the country.  And for opening an account a passport is sufficient, you can identify yourself in a video chat.  Now what's the downside?  French banks' online services are in French, German banks' services are in German.  If that doesn't put you off, I would name such banks in the comments if asked. Are there any online services for investing money that aren't tied to any particular country? Can you clarify that?  You should at least be able to buy into any European or American stock through your broker.  That should give you an ease of mind being FCA-regulated.  However, those are usually GDRs (global depository receipts) and denominated in GBp (pence) so you'd be visually exposed to currency rates, by which I mean that if the stock goes up 1% but the GBP goes up 1% in the same period then your GDR would show a 0% profit on that day; also, and more annoyingly, dividends are distributed in the foreign currency, then exchanged by the issuer of the GDR on that day and booked into your account, so if you want to be in full control of the cashflows you should get a trading account denominated in the currency (and maybe situated in the country) you're planning to invest in. If you're really serious about it, some brokers/banks offer multi-currency trading accounts (again I will name them if asked) where you can trade a wide range of instruments natively (i.e. on the primary exchanges) and you get to manage everything in one interface.  Those accounts typically include access to the foreign exchange markets so you can move cash between your accounts freely (well for a surcharge).  Also, typically each subaccount is issued its own IBAN. What you are asking about is called Interest Rate Parity. Or for a longer explanation the article Interest Rate Parity at Wikipedia.  If the US has a rate of say zero, and the rate in Elbonia is 10%, one believes that in a year the exchange rate will be shifted by 10%, i.e. it will take 1.1 unit of their currency to get the dollars one unit did prior.  Else, you'd always profit from such FOREX trades.  (Disclaimer - I am not claiming this to be true or false, just offering one theory that explains the rate difference effect on future exchange rates. Atm machine and my Credit Union account. Low fees (often zero, if the machine is on any of the same networks) and decent exchange rate, and no need to carry cash or traveler's checks to be exchanged. Alternatively, pay by credit card, though there is a foreign transaction fee on that. A proper commercial bank will charge lower fees for currency exchange than most other banks .. and banks will charge less than places that just do currency exchange. Actually, I've usually found that the best way to get currency is to use the atm/credit-card networks and withdraw money from my own bank.