Protecting our money with brexit currency drops
Kevinweav
Posts: 1 Newbie
As no deal becomes more likely and sterling likely to drop again as a result, what can we do to protect the value of our savings? Are international saving accounts an option? Bonds? Gold? We're really worried that our savings might crash in value with the pound and want to protect what we have rather than look to grow it. Ready access is also a requirement. Looking forward to hearing what you might suggest.
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Rather than trying to protect yourself in the event of 'No deal', make sure that it does not happen. Write to your MP and ask all your friends to do the same.0
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As no deal becomes more likely and sterling likely to drop again as a result, what can we do to protect the value of our savings? Are international saving accounts an option? Bonds? Gold? We're really worried that our savings might crash in value with the pound and want to protect what we have rather than look to grow it. Ready access is also a requirement. Looking forward to hearing what you might suggest.0
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Do you take lots of foreign holidays ? Other than that what's the issue? If your Pounds are worth say 10% less Euros or Dollars what effect will have on you ? In the bigger picture expect a one off hike in inflation but most of that's baked in already with the Pound having fallen and as and when Brexit actual occurs I'd expect to see a rise in the Pound. Which similarilly won't affect you much either0
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Depreciation of sterling also affects the price of imported goods, and imports are about 30% of UK GDP.0
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If you live in the UK, save £ in the UK and spend £ (primarily) in the UK, why would you consider that sterling dropping would cause a loss in value of your sterling savings in any meaningful sense? Sure, they might not buy as many € or $ when you go on holiday, but holiday spending money doesn't really seem like a valid reason for currency speculation (aka gambling) with large chunks of savings that wouldn't be affected by forex fluctuations anyway....
With this scenario, I can empathise with the OP’s fears. I am not yet considering wheelbarrow futures but perhaps Chequers is actually starting to look like a decent option.0 -
I agree with this in regard to currency speculation however, any drop in the value of Sterling would fuel inflation, at least in the short term. This in turn would erode the value of savings. But the uncertainty may also affect the value of investments, the traditional safer protection against inflation.
With this scenario, I can empathise with the OP’s fears. I am not yet considering wheelbarrow futures but perhaps Chequers is actually starting to look like a decent option.
A lower pound would increase the value of investments unless you've invested very very badly.0 -
AnotherJoe wrote: »A lower pound would increase the value of investments unless you've invested very very badly.
PS. Just realised that I have digressed from the subject of the thread which is the value of Sterling post Brexit, not the value of investments.0 -
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If you have a globally diversified portfolio a fall in Sterling should see the value of your investments go up. A fall in Sterling will make imported goods cost more so inflation might be the biggest worry to most people. Also a cheap pound will make UK exports less expensive which might go some way to offsetting having to trade under WTO tariffs if there's no deal........but even if the UK is out in March 2019 I bet there will be some deal done on a transition period as the UK having to deal under WTO rules with the EU and the rest of the world would mean a decade of issues for trade as the UK hurries to renegotiate all the EU treaties currently in place. I assume the EU deals would be the starting point, but I can't imagine that the UK would get quite as good a deal when dealing with the EU, USA, Japan, China etc because we are smaller..........“So we beat on, boats against the current, borne back ceaselessly into the past.”0
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Wouldn’t the continued uncertainties surrounding Brexit reduce the value of investments?0
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