Cash Savings in Turkey

Susan_Lea

I have been advised to put cash into the Turkish arm of QNB as the interest rates are high. Has anyone any experience of this bank and is the cash protected?

Malthusian

Advised by whom?

The interest rates are high for a reason, because the Turkish lira loses its value notoriously quickly. Unless you are going to be living in Turkey and using the money to buy stuff in lira, it's terrible advice.

fwor

Susan_Lea wrote: »

I have been advised to put cash into the Turkish arm of QNB as the interest rates are high. Has anyone any experience of this bank and is the cash protected?

Who advised you to do this, and why?

Do you know what the current inflation rate in Turkey is? (Hint: some projections for the coming year suggest that it will be ten times the UK inflation rate). You need to account for this when comparing interest rates.

eskbanker

Who advised you to do this and on what basis?

There are many reasons why saving in other countries is a really poor idea, even if foreigners are actually permitted to open accounts there - see this thread for example: https://forums.moneysavingexpert.com/discussion/5838916/can-i-open-a-savings-account-abroad

AnotherJoe

were you advised to do that by one of the inmates when you visited a secure unit? If not, you should take them to one anyway and in the meantime remove all sharp implements from their home.

redux

A year ago the Turkish lira was worth about 18 pence. Now it's around 13.5 pence. Last summer it nearly touched 11 pence.

Are you ready for nervous breakdowns as you watch it seesaw up and down, but more down than up?

quirkydeptless

I did try storing my cash savings in Turkey, but it all was burnt to a crisp at Christmas, so I'm not doing that again!

Voyager2002

Of course, a dollar account with a bank in Turkey might indeed offer high interest... but with the possibility that the bank (and the money) might not be there when it was time to withdraw. More exciting than a thriller on Netflix, but probably more expensive as well.

dealer_wins

OP dont ask for medical advice from that person if you like being alive!!

londoninvestor

Malthusian wrote: »

Unless you are going to be living in Turkey and using the money to buy stuff in lira, it's terrible advice.

People who do live in Turkey and buy stuff in lira are also pretty keen to have their savings in hard currency and avoid lira!

Aretnap

Why Turkey specifically? There are plenty of countries with higher interest rates than the UK. Why not Brazil, or Russia, or India?

Of course the catch with all these countries is that high interest rates tend to go hand in hand with high inflation and devaluing currencies. So you might get a better headline rate, but after a year your savings will probably have diminished in value, both in pound terms and in terms of what they can actually buy with them. Overall the expected real rate of return is little different from a UK bank, and you are also exposed to the risk of short term currency fluctuations, over and above the expected long term decline of the Turkish Lira (or whatever). There ain't no free lunch to be had.