Protect your Savings with No1 Currency Predetermined Exchange Rates
Released on: October 29, 2008, 7:07 am
Press Release Author: No1 Currency
Industry: Small Business
Press Release Summary: A forward contract is an agreement that enables you to lock into a favourable exchange rate for up to two years before you need to transfer your savings. Essentially, this means you are able to buy your currency now and pay for it up to 24 months later, thereby protecting your savings from any negative currency movements
Press Release Body: Emigrating from the UK to destinations such as Australia and New Zealand requires a large amount of time for careful research and preparation. Planning can typically take a year or more during which time currency fluctuations can often be between 25-30% According to No1 Currency. These indeterminate moves could result in huge losses against original budgeting when transferring savings abroad.
Recent market tensions have seen favourable moves in sterling against both the Australian and New Zealand dollar revealed No1 Currency. However, we only need to look back to last summer when a peak in sterling resulted in a fall in value against both the Australian and NZ$ in the region of 20% over a five to six month period. This type of adverse currency movement would clearly have a huge negative effect on the value of your savings.
Putting this example into hard cash figures, a couple planning emigration to Australia last year needed to exchange GBP150,000 to Australian dollars. At the beginning of the process in August, their savings would have secured around A$382,500. By the time they were ready to make the move in May of this year, the fall in the value of the pound had seen the equivalent value fall to A$307,500. This equated to a loss of A$75,000 or, in sterling terms, GBP36,585.
By speaking with their Foreign Currency Specialist such as No1 Currency, this type of exchange loss could have been avoided. From the moment you are aware of the approximate value and timescale of your transaction, you have an exposure to exchange rate fluctuations and the obvious knock on impact on your budgeting. This can be avoided by booking what is known as a forward contract. When entering into this contract, you are agreeing a predetermined exchange rate for a date in the future. This then allows you to concentrate on the other important aspects of your move without the worry of potentially damaging moves in the foreign exchange market.
In general terms, exchange rate fluctuations tend to be far greater in GBP-aud and GBP-nzd than many other currencies. According to No1 Currency this renders currency predications less reliable for those looking to transfer large sums of money to these countries. This again highlights the benefits of a forward contract.
David Lamb of No1 Currency explains 'A forward contract is an agreement that enables you to lock into a favourable exchange rate for up to two years before you need to transfer your savings. Essentially, this means you are able to buy your currency now and pay for it up to 24 months later, thereby protecting your savings from any negative currency movements'
Forward contracts provide an ideal solution for anyone who is planning on moving abroad. Often, transfers of savings and assets are left until the last minute, the consequences of which have been highlighted. In some cases, transferring of funds can take far longer than anticipated, especially if money is tied up in a UK property which is proving difficult to sell.
By contacting No1 Currency, your Foreign Currency Specialist, straight away these exchange rates can be fixed at a predetermined rate. Thereby, not only allowing you to lock into favorable rates but giving you the added security of knowing exactly how much you will have when you start your new life abroad.
With your savings protected from the uncertainties of the foreign exchange market, you can relax and take your time in planning the rest of your emigration to paradise.
For more information visit: http://www.no1currency.com/
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