I am terrified - these are my life-long savings

apt

As Reaper rightly says, currency movements are unpredictable. But it is clear that there has already been a substantial devaluation of the pound. It is likely, but not inevitable, that most of the fall has already taken place. The level against the euro is fairly close to its low-point against the major European currencies in the last sterling crisis/devaluation in the early 1990s. Also the pattern in previous sterling crises is that after a while the pound recovers some but not necessary all of its value. Again this is only likely, not inevitable. So if you are in the position that you can afford to wait before converting your money, or might not need to convert your savings at all because you decide to buy a property in Britain, then I personally would not be hurrying to put earnings in pounds into euros at the present low exchange rate plus the added cost of currency exchange fees and lower interest rates on your savings. But if I was sure I needed the money to spend in foreign currency in the next year I might be more tempted to split the money in the way Reaper suggests.

DocProc

Here's a good site to quickly check on exchange rates:

http://www.xe.com

The popular ones are in a table and you can use a tool underneath the table to compare other currencies

Fly_Baby

DocProc, thanks, that's a useful resource!

musclesza

Fly_Baby wrote: »

Reaper, Russia is in panic right now over predicted further rouble devaluation and possibly denomination, with people withdrawing their savings from banks and hastily converting roubles into dollars. So if I choose between currencies it cannot be rouble.

I feel helpless. I was never trying to be greedy, I never wanted to make money out of my savings, I have been just saving to buy a home. I feel plain cheated. I realise though that many people are in a much worse situation.

Your first question is answered - dfotn touch roubles as to whether it is Euro or Pounds - I dont know.

Things will get worse before they get better - If you went back to Russia would your husband get a job? If he stays can he get benefits?

Dont feel Cheated - you have a lot more saved than I reckon 80% of the UK - seriously most people might have a house but it is by the bank - there are few people with 70k and no debt

Fly_Baby

musclesza wrote: »

Things will get worse before they get better - If you went back to Russia would your husband get a job? If he stays can he get benefits?

musclesza, thanks for your post!

My husband will get a job if we go back to Russia - but it will probably be a very low paid one (that's the reason we moved to the UK in the first place - his profession is paid much better here).

I doubt that he will get any benefits in the UK if he becomes unemployed - I understand that the amount of our savings makes us uneligible to any of those.

ed123_2

...I think the £ will fall further (against the US $... against the Rouble differcult to say but I would think Russia would be affected more by reccession), with UK base interest rates due to hit 1% or even 0%.....the US in my view will recover first, so I would opt for US$......

EdInvestor

If you want to hedge risk by diversifyong currencies, the US dollar is probably a better bet than the Euro.This is because the Russian economy is heavily oil-dependent, and oil is priced in US$.

IMHo the OP should stop panicking and wait for things to settle a bit. In particular don't switch out of sterling right now when it's very low.There's no rush.

jamesd

You can't know what will happen but you can diversify. Many UK banks will offer you accounts in US Dollars and Euros and you can use them to reduce the variation in value of your savings.

You can also make regular buys of investments in Russia, Eurozone and the United States so that if there is major recovery your investments are also likely to increase in value. This is a better way to produce long term stability but there will be great short term variation in value.

For Russia, the oil and other commodity prices will recover as the world economy recovers so it is mostly a question of whether the government will run out of money before that happens. That seems unlikely to happen. It may be still a difficult two years in Russia as well as other countries.

refusnik

Fly_Baby wrote: »

movilogo, we come from Russia. Property prices have escalated there over the past 5 years and our savings would not be enough to buy our own place for cash there - and even less so now, with pound dropping.

Mortgage lending system in Russia is still far from perfect - you are virtually becoming a slave to the bank for 25 + years with little or no rights, and that comes with a 13-15% interest rate.

Moving to another country in such troubled times might not be a good idea. You may lose much more than just implied by the deteriorated currency exchange rates. Why not wait a few years?

Prices in Moscow have started to fall back ( http://www.irn.ru/gd/ ) and will drop like a stone as soon as property bubble unwinds and the country starts to live by its means again (oil prices collapsing.)

Have you worked out the tax implications of moving such a huge amount of money into Russia?

P.S. I am from Russia as well, live in the UK for 6 years and have savings in £ but I don't think I would be brave enough to move anywhere any time soon. Also, I don't want to take my earnings away from this country.

My personal opinion is that property all over the world (bar few places) is hugely overpriced and due to whopping correction while credit is withdrawn and people turn their attention to other investments. Cash in any reasonably solid currency might be the best idea now.

alchemistkevin

I would stay put if I were you, Russian markets are not doing too good and their currency is more likely to go down to the £ than the other way round.

£ has fallen quite sharply in the last two weeks and your money is much safer here than in Russia, keep it here while you're here and move it out when you actually need to.