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Savings in $$ Is it worth waiting for the exchange rate to drop?
curlygal82
Posts: 1 Newbie
I have a bit of a weird situation. Basically I have a baby with a US citizen and we are no longer together. I live in the UK with our child, and he lives in the USA.
My ex is talking about sending over some money - say $450 or so for arguements sake to help with raising our baby. However, to do a wire transfer from his account to my UK one would cost him over $50 a month, and would eat up quite a chunk of what he wants to send. He is suggesting instead that he send the money to an old US account I have, and I withdraw it from ATM's as and when I need it. I've looked into it, and I can change the address to my address here in the UK without any problems, so its not like he would be able to access the money.
As it stands I'm not used to getting the money and don't rely on it at all. If he does send it (this is all if's here) I would seriously consider leaving it in there in $ to build up as savings, until such a time that the exchange rate alters and then I would transfer it in one lump sum into my UK account. I'm wanting to save for a mortgage and hope to have a nice deposit in 4/5 years or so, so I wouldn't really need it until then.
Anyway, I was just wondering what people predict will happen with the $ in the next few years? I know no-one can give definates, but in your opinion is it likely that it will drop back to a reasonable rate (say closer to $1.5 to the £) or would I better off pulling the money out every month from an ATM and paying it into a savings account here? Also, are there any tax or money laundering implications I need to consider with all of this?
Any advice would be appreciated as I'm a bit clueless with it all! Thanks!
My ex is talking about sending over some money - say $450 or so for arguements sake to help with raising our baby. However, to do a wire transfer from his account to my UK one would cost him over $50 a month, and would eat up quite a chunk of what he wants to send. He is suggesting instead that he send the money to an old US account I have, and I withdraw it from ATM's as and when I need it. I've looked into it, and I can change the address to my address here in the UK without any problems, so its not like he would be able to access the money.
As it stands I'm not used to getting the money and don't rely on it at all. If he does send it (this is all if's here) I would seriously consider leaving it in there in $ to build up as savings, until such a time that the exchange rate alters and then I would transfer it in one lump sum into my UK account. I'm wanting to save for a mortgage and hope to have a nice deposit in 4/5 years or so, so I wouldn't really need it until then.
Anyway, I was just wondering what people predict will happen with the $ in the next few years? I know no-one can give definates, but in your opinion is it likely that it will drop back to a reasonable rate (say closer to $1.5 to the £) or would I better off pulling the money out every month from an ATM and paying it into a savings account here? Also, are there any tax or money laundering implications I need to consider with all of this?
Any advice would be appreciated as I'm a bit clueless with it all! Thanks!
0
Comments
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Hi,
As you say, no one knows what will happen with the £/$ FX rates. I have seen report from HSBC that indicates sterling will drop to $1.8 within 18 months???
It is clear that based on purchasing power parity (PPP), sterling is over valued against the $. I would suggest that you do your own research into the complex issue of FX markets. Here's your starter for 10:
http://en.wikipedia.org/wiki/Big_Mac_Index
http://seekingalpha.com/article/26635-burgernomics-profiting-from-the-big-mac-index
HTH.In case you hadn't already worked it out - the entire global financial system is predicated on the assumption that you're an idiot:cool:0
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