Your Pension Overseas - how much is it really worth?

Smart_FX

A lot of people recently approached me to find out how best to maximise their UK pension overseas.

:exclamati Common problem - with the rate of Sterling/Euro weakening in past months, UK pensioners living abroad receive less and less for their years of hard work.

But, do they deserve to be victims of current recession?

What can pensioners abroad do about their monthly pension dropping in value?

Firstly talk to the currency specialists (lots of them in the market) and find out how you can protect your pension's value. All currency specialists can fix the exchange rates for longer periods (couple of years) to protect pension against fluctuations.

Secondly, find out how much it cost you to transfer your pension from your UK bank to overseas bank account on the monthly basis. (usual charges are between £20 - £25).

Thirdly, compare this charge with the currency specialist firm and calculate savings per year on the transfer fee only. (some currency firms charge between £5- £15 depending on the value of transfers).

Lastly, find out the differences between exchange rates that your bank offers and currency specialists. Sometimes these are nearly 4%.




Here to Help and Save Money

dunstonh

spam reported.

Smart_FX

Excuse me I am not spaming

dunstonh

No of course you are not. Now why would I have got the idea that you are?

Smart_FX

All what I am trying to do is make people aware that there are other options on how to save money.

You would be surprised how many unaware people are out there.

I am more than happy to discuss it with you. Perhaps you know people who may consider saving of £240 a year significant. (average yearly saving on bank transfers).

EdInvestor

You are breaking forum rules. Suggest you get rid of the links in your posts, otherwise they will be deleted.

dunstonh

It is against board rules to ask people to contact you as well.

Smart_FX

being new here is not that easy... you hear comments and critics from every angle.

have some merci

purch

You are breaking forum rules

And posting incorrect and incomplete information.

If you need to hedge an exchange rate risk you can quite easily and economically do so for periods far in excess of 1 year.

Smart_FX

Purch it is correct that you can do it for couple of years

But saying that it is not advisable to do it for such a long time as the interest rates in different countries change at least 4 times a year, which as got impact on the currencies also.

But fair enough, I changed my statement.

But you are right you can do it, but industry standard is becoming 1 year. Currency companies are otherwise exposed to greater risk longer the period of fixing is.

purch

Do you have a clue what you are talking about ??

Purch it is correct that you can do it for couple of years

Couple of years ??

The FX Markets have been around for decades, and you have been able to trade well out into the future for 50+ years.

Medium Term prices are extremly liquid out to 5 years, and easily tradeable out to 10 years in major currency pairs.

Can you explain what you mean by:

But saying that it is not advisable to do it for such a long time as the interest rates in different countries change at least 4 times a year, which as got impact on the currencies also.

How does that fit the scenario you are suggesting ?

As a FX professional you will be aware that:

A) Interest rate movements have no effect on exchange rates except in the effect they have on the underlying economies
A FX trade that fixes/hedges an exposure forward is only influenced by the exchange rate and interest rates at the time of the trade, not after the trade.

Currency companies are otherwise exposed to greater risk longer the period of fixing is

What does that mean ?

If a currency company enters into a Forward FX trade with a counterparty they are hardly going to leave the trade uncovered are they ? A properly hedged position will leave no risk at all.


By the

the currency specialists

I assume you are referring to the parasites who leech off the liquidity and pricing created in the wholesale markets by professional interbank traders ??