Moving to Italy for a year but salary in dollars..

prsnbx

Hi, this is a tricky one for us to solve.

Our family is moving to Italy for about a year. My wife is being paid her salary in two lump sums. Half before we get there and half mid way through our stay. Her salary will be in dollars and a not insignificant amount.

Our question is what is the best thing to do with this?

My gut instinct is to have it paid into a stirling account with reasonable (hah) interest rates. Maybe open a Natwest ( ? the one with no debit card charges) account and top it up when we need it.

But would we be better converting a significant sum into Euros straight away, in the hope that we will get a better exchange rate?

We'll need a reasonable percentage of her salary whilst we are over there but maybe not all of it. So it may make sense to stick it somewhere safe in the UK and tap into that when we need it.

WRT Italian bank accounts we want to find one that doesn't charge us a fee and has good ATM coverage. My assumption is that having an Italian account when we are over there would be advisable. No idea on them yet though.

Can anyone offer any pointers?

My feeling is that whatever we do we are going to be left speculating on Euro/Dollar/Sterling exchange rates.

TIA, Dan

benjus

Nationwide is the one with free withdrawals, not NatWest (they charge almost 5%!)

As I see it, it comes down to deciding whether to convert the Dollars to Sterling or Euros. Personally I would probably do what you suggested - have it all converted to Sterling (find a good Forex company to get a good exchange rate) and use a Nationwide card to access the money. Unfortunately you don't get any interest with Nationwide, so you would have to shuffle the money around between accounts if you want to earn interest.

I don't know about Italy but in other European countries it's quite common to be charged for using an ATM in a bank other than your own, so the Nationwide card has a great advantage over local cards. You will probably need an Italian bank account to pay for utilities etc, but you can just get the cheapest, most basic one possible (perhaps without an ATM card) and use the Nationwide card for everything.

Of course, depending on how exchange rates change this option may prove not to be a good choice - unfortuately there's no way to know in advance whether you're better off converting to Sterling or Euro. You're right in your last sentence - any choice you make (even if you decide to leave the money in a Dollar account) will be affected by movements in exchange rates.

inspector_monkfish

moving to Italy?
Paid in US Dollars??

hmmm...

do you work for the New York m@fi@??


sorry,
you are right, it seems whatever you do, you are at the mercy of the exchange rates.
One day they can be in your favour, the next day they can be agaist you - but i would imagine it will all even out over the space of a year...

buddabing!!

spiro

You also need to think about taxation. If you are going to be out of the country for a year it may be better to get all the salary paid in one country to avoid having the complexity of doing tax returns in two countries. Logically get it all paid in Italy and then anything you bring into the UK is tax free. Need to advise UK authorities before you move.

prsnbx

Thanks for the replies so far.

The tax issue is another whole subject we have to deal with. The UK tax office appear to be saying that we are not liable to pay tax as we will be out of the UK for the majority of the tax year.

However, the Italian tax year runs from Jan to Dec. And we won't be in Italy this tax year or next tax year to qualify to be resident.....

Maybe I need a financial advisor??

dan