What to do with euros?

Birdwell

Hi,

I'm an EU citizen who's been living for a couple of years in the UK. As such I've got savings in euros in my home country, ~20k€ in the equivalent of a cash ISA (tax-free, safe, instant access... and paying a whooping 1%/y). I've been reviewing my finances and decided I want to keep some of it accessible for whne I'm visiting home, but get the rest working a bit harder for me.

The problem is I can't open a new bank or investment account back home as I'm no longer a resident (same way as UK banks require you to be a UK resident). If I want to transfer some of that money in the UK I'll have to pay exchange fees, and given the current exchange rate that's not a good idea anyway.

Have you any other tip to offer?

ermine

Birdwell wrote: »

I want to keep some of it accessible for whne I'm visiting home, but get the rest working a bit harder for me.

There are two issues here. One is that some of the the value of your savings is probably going to be destroyed deliberately by government policy through the ECB doing QE. In the UK we've already been through some of that - I had funds in a global stock market index in 2009-12 and most of the 20% nominal rise was in fact the value of the pound being deliberately destroyed rather than me being a great investor.

And the other is you want to make a return on your capital. I would guess that the far greater hazard is the value of your money being destroyed by ECB QE. You could consider hedging some of your money - some of the companies in this article offer solutions for expats which also describes some of the high-level picture.

You way want to consider that we have an election in May, uncertainty may damage the value of the pound. Greece, on the other hand, may damage the value of the Euro in the short term.

Your biggest problem is forex shifts - the changes possible there will probably dwarf any interest you make on your money in a low interest-rate environment.

ColdIron

Birdwell wrote: »

If I want to transfer some of that money in the UK I'll have to pay exchange fees, and given the current exchange rate that's not a good idea anyway.

Given the current GBP/EUR exchange rates I'd say this was a [STRIKE]better[/STRIKE] worse time than most. You can't avoid transfer fees but if you look around for some fx comparison sites you ought to be able to minimise them

coyrls

ColdIron wrote: »

Given the current GBP/EUR exchange rates I'd say this was a better time than most.

To change Euros to Sterling? Surely not.

[Deleted User]

Don't transfer the money to the UK because the Euro is too low. I'm in a similar situation but with much less cash than you. I'm stuck. Can you use online banking on your euro account? See if you need to buy anything cheaper in the continent and buy from your EU account.

ColdIron

Hmm. you are right, I was thinking of it from a buying Euros with GBP PoV, apols

mad_rich

What are your medium and long-term plans?

If you plan to return to your home country, there's little point in switching everything to £. (All things being equal, you'll lose out twice in conversion.) On top of that, the prospect of selling € when the currency is at such a low seems silly unless you need to.

(Having said that, you may decide that you want to hold some of your portfolio in £, but that would have to be a strategic decision.)

Are there any similar forums from your home country where you can ask this question? While the folk on here are helpful, we probably won't have enough specific knowledge about the financial industry in your country to offer good advice. (It might be that there's a way to open savings/ investment accounts, for example.)

[Deleted User]

ColdIron wrote: »

Given the current GBP/EUR exchange rates I'd say this was a better time than most.

What? :eek:

Birdwell

ColdIron wrote: »

Given the current GBP/EUR exchange rates I'd say this was a better time than most. You can't avoid transfer fees but if you look around for some fx comparison sites you ought to be able to minimise them

Ah ah no, as others have pointed out I'm interested in getting some euros into the UK

Birdwell

mad_rich wrote: »

What are your medium and long-term plans?

If you plan to return to your home country, there's little point in switching everything to £. (All things being equal, you'll lose out twice in conversion.) On top of that, the prospect of selling € when the currency is at such a low seems silly unless you need to.

If only I knew... I'm 25 and single. If tomorrow I meet the woman of my life, I'll spend the rest of my life here; if however I get offered a great job in say Australia or Brasil, I might well take it. (and if UKIP gets its say, I might be deported ).

I do plan to stay the next few (3-5) years in the UK.

Birdwell

ciaccino wrote: »

Don't transfer the money to the UK because the Euro is too low. I'm in a similar situation but with much less cash than you. I'm stuck.

Are you saying I should just wait then?

ciaccino wrote: »

Can you use online banking on your euro account? See if you need to buy anything cheaper in the continent and buy from your EU account.

If I'm buying stuff from the EU, wouldn't it make more sense to use a UK credit card? I actually already started paying some of my EU holiday arrangments on my UK (commission-free) card, but will use my home card for cash and smaller payments.