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inflation
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Nothing stopping you getting exposure to bonds this year if you want to. quote]
Sorry I meant to buy a house, not bonds. If I was to withdraw the money back within a year I would get back just the original amount , does not matter how much it depreciated in the time it was in, right?
Thanks Clapton, that is exactly what I was going to write - just found out an interest rate is about 2-3%.:o BUT : it would be about 4% difference from the £ one, further diminished by tax. On £10000 it would be only £400. In turn, if pound gets cheaper by 10% this year the loss is one thousand. Not a big deal of difference, but what if it falls at the same rate 10% in 6 month? Then it becomes worse... So the question is: how much will the pound devaluate against euro this year?
P.S. Who'd think in buying euro this June?! But in October I could buy it at 1,43 still... eeeehhhhThe word "dilemma" comes from Greek where "di" means two and "lemma" means premise. Refers usually to difficult choice between two undesirable options.
Often people seem to use this word mistakenly where "quandary" would fit better.0 -
justme, if you are simply saving to buy a house in the UK ( guessing that this is what you mean by " saving for a deposit " ) it would be daft to start dabbling in currencies. Put the money on deposit in the best savings account you can find and leave it at that.0
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Very good advice from cheeful.
Why do think people always they can invest and make money in things they have no idea about? People that actually know about and understand specific areas still lose sometimes!0 -
That is not about me, I'm not trying to invest or make money, just hope to protect earned few grands from depreciation.Very good advice from cheeful.
Why do think people always they can invest and make money in things they have no idea about? People that actually know about and understand specific areas still lose sometimes!The word "dilemma" comes from Greek where "di" means two and "lemma" means premise. Refers usually to difficult choice between two undesirable options.
Often people seem to use this word mistakenly where "quandary" would fit better.0 -
Generally a savings account will inflation after basic rate income tax over time. However, it all depends on what you are planning to buy.
House price inflation was 7% last year and over 20% in London and there is no low risk savings account out there that has delivered those kind of returns.
House prices in 2008 are widely forecast to be flat or even fall in some areas. Sterling is forecast to become weaker against some currencies because our Economy is seen to be stronger than the US but weaker than much of the EU/Euro area.
All these are predictions and forecasts though and not the basis for short term investment decisions.
In my view you should forget about foreign currency accounts and stick your money in the best paying UK savings accounts, using your tax free allowances where possible.
You should also think carefully about buying property in a falling market, unless you are prepared to have negative equity in the short term.
R.Smile
, it makes people wonder what you have been up to.0 -
Thanks Jon3001, I have zero knowledge in the trading area, it could be the best option but I can not deal with something I do not know.Nothing stopping you getting exposure to bonds this year if you want to. Fixed interest bonds do poorly in inflationary environments so you'd probably be looking at index-linked bonds via a fund or ETF.
E.g. iShares do an index-linked Euro bond ETF:
http://www.ishares.eu/fund/fund_performance.do?fundId=157750
Such funds appreciated rapidly in Sterling terms as GBP declined:
http://uk.finance.yahoo.com/q/bc?s=IBCI.L&t=6m&l=on&z=m&q=l&c=
Obviously you'd be assuming both the forex risk and exposure to bond markets. But it depends on what you're looking for. Even the language you used in this post sounds scary ( "exposure to bonds" etc) not to say about "assuming forex risk" - this frase made me have a goose skin.
So I bought euros at 1.319 in BoS account- it will be interesting to see where it goes from now The word "dilemma" comes from Greek where "di" means two and "lemma" means premise. Refers usually to difficult choice between two undesirable options.
Often people seem to use this word mistakenly where "quandary" would fit better.0 -
this frase made me have a goose skin.
Hmmm. A poster who can spell ( and knows the word ) " prognosticate " but has difficulty with " phrase "...
Good luck with your foreign exchange deal....0 -
are you puzzled, cheerful cat?cheerfulcat wrote: »Hmmm. A poster who can spell ( and knows the word ) " prognosticate " but has difficulty with " phrase "...
Good luck with your foreign exchange deal....
The word "dilemma" comes from Greek where "di" means two and "lemma" means premise. Refers usually to difficult choice between two undesirable options.
Often people seem to use this word mistakenly where "quandary" would fit better.0
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