If you’re an international student or employee who’s also a member of the Harvard University community – welcome! We all know that setting up finances in a new country can be a little tricky, so here’s a quick guide to savings accounts in the US for international residents.
Benefits of Opening a U.S. Account
There’s no requirement that international students and employees keep their money in a US account, but it’s usually a good idea. Having an account in the United States will make it much more convenient to get cash when you need it and pay for dining and errands via a debit card, without international transaction fees which can add up fast. Moreover, many digital payment platforms only work with a US account – including Zelle which you can use for person-to-person payments, Hemlane which some landlords use to collect monthly rent payments, and so on. Another major benefit of opening a US savings account is that keeping an account in good standing helps you demonstrate creditworthiness, which will be important if you expect to apply for a loan or US credit card in the future.
- When to apply: There’s no harm in applying for a US account before you arrive to the country; especially if you already have a US mailing address. Indeed, since COVID, more and more financial institutions like HUECU are offering remote application processes. However, you should wait until you’re in the US and residing at a local address to order debit cards and checks – as these can only be requested and issued once you arrive in the United States.
- Leaving the US: On the other side of things, you might be thinking ahead and wondering what happens to your account when you leave the US. There’s no rule against having a US savings account if you don’t live in the country, as long as you still have a valid mailing address. Indeed, many international students and employees find it useful to maintain an American account for convenience when accessing online payment and shopping platforms that require a US savings account or credit card. And, if you move back to the US, keeping an open account in good standing will be better for your creditworthiness than closing the account.
- Taxes: Taxes are another consideration. You generally don’t need to pay money to the IRS on a US account and you shouldn’t be taxed by the US government at the time your account is closed – but always consult a tax professional if you’re handling large sums of money or have any other concerns. Do keep in mind that if you paid US income taxes and you’re due a refund, it can be more convenient to get this directly deposited into your US savings account.
Choosing the Right Account
When it comes to choosing an account, your options are truly endless! Consider what financial transactions you’ll do the most during your time in the US – whether that’s paying bills, receiving direct deposits from your employer, saving money, sending international transfers, and so on. In general, be wary of accounts with a lot of bells and whistles, that don’t offer straightforward terms and hassle-free service. Look for an account with low or zero fees, and of course, a financial institution with the ability to wire or transfer funds overseas so that even when you’re away from the US, you have a convenient way to access your money.
Steps to Open an Account
Opening a savings account is usually done in person, but since COVID many financial institutions are making it possible to do this remotely – including HUECU! You can check out the simple process to open an account remotely at huecu.org/intl/. Wherever you are, check with your financial institution for a full list of what you need to open an account. Expect to show a passport and ID card, plus you’ll likely fill out an application with details on your residence and personal information. Most accounts will be approved within two weeks of the application process, at which point you can make your initial deposit into the account via a bank transfer or international money wire. After that, there’s nothing left to do but start putting away money and making progress toward all your great saving goals.