Wealth management expert Daniel Butcher explains why a Luxembourg-based “assurance vie” bond is the best investment option for expats looking to grow lump sums or create income.
When Daniel Butcher’s British expat client came to him with €200,000 to invest, he advised her to take out an assurance vie policy in Luxembourg over any other country in Europe.
While there are many assurance vie products in France and other European countries, none offer French residents the same kind of flexibility and protection for a lump sum that the Luxembourg-based option provides.
While bank accounts in France are protected by the Fonds de Garantie des Dépôts et de Résolution (FGDR), the FGDR will only cover up to €100,000 per person per bank in case bankruptcy and assurance vie even less at €70,000.
Luxembourg Assurance vie, however, benefits from a triangle de sécurité (security triangle) formed through protection from the bank, the insurance company, and the Commissariat aux Assurances (CAA), giving the policy holder a “super privilege” status.
This means that as well as being better protected than any other scheme, the protection offered is without limit.
“Multimillionaires, as well as day-to-day investors, use Luxembourg Assurance vie for that reason,” said Daniel Butcher, assurance vie specialist and founder of DTB Wealth Management. “Basically, investing in Luxembourg policies means that your capital is protected and no one will ever be able to stop you taking your money and walking away with it even in the event of a crisis.”
Another major advantage of taking out a Luxembourg-based assurance vie policy is its wide-ranging flexibility. With the right help and advice, Daniel’s client will be able to tailor-make a policy that matches her needs.
“She can choose the asset manager, the currency, the language, the beneficiary (in case of death) and even have two separate lump sums in the same policy with them both managed differently,” said Daniel. “Going for a Luxembourg policy, is definitely the safest and soundest solution in Europe if you have a lump sum and wish to increase your capital or generate an income.”
Another advantage of this policy is that should his client decide to return to the UK at any point, the Luxembourg assurance vie simply transforms into an offshore bond, with the tax advantages that go with it.
“At DTB Wealth Management we work with all Luxembourg policies and invite those interested to get in touch so we can help find the best assurance vie products for our clients’ needs.”