Savings in EURO

LB15 wrote: »

I am searching for irish saving accounts but the interest rates are terrible. Any advice on how to store this money as euros where I will also be earning interest and not getting charged?

Best place to get a good rate of interest on Euros, fee free, is in your dreams...

Here in the real world, we know that the interest rate from the European Central Bank is negative 0.4%, and banks can get finance from overnight lending at 0.25%. So banks do not welcome customer deposits at much higher rates than that.

Individual banks within the Eurozone may have the appetite to take deposits from local customers to finance their lending operations, to whom they could pay a better rate in the hope that they can sell on other services (credit cards, mortgages, personal loans). A bit like here in the UK where some banks and building societies will offer rates on a short term basis on limited amounts of money as a marketing tool. However, if you live here in the UK rather than in the Eurozone, the banks there are not going to be signing you up for the special promotional rates with the intention of cross-selling you a credit card and value-added services when you pop into their local branches.

My Euro cash is with Citi, in an account that pays zero. Within my S&S investments I do have investment funds that invest into European businesses (and other businesses from around the world), but that is a longer term thing, rather than just for holiday and travel money.

If you are holding the Euros as a longer term thing on some vague idea of maybe returning back to Ireland someday, it is a little shortsighted to keep the money in cash: where you get pretty much zero interest rate, it costs you to maintain the account, and inflation will erode the spending power of your money. So if this is for the long term, use S&S investment funds.

If instead it is short term, then recognise that what your account is doing for you, is not acting as a moneysipinner but instead is protecting some of your cash from a devaluation of sterling so you'll still have those Euros when your pounds are each only wotth one Euro or some other number lower than today. That's the only real function of a non-interest-paying account in a country you don't visit and a currency you don't spend day to day.