2016 wasn’t the greatest year that we’ve seen in our life, with Brexit, Donald Trump’s surprise election win and the fall of the pound; expats everywhere were unsure what the uncertain future holds
Of course, there are negatives to each of these events, there are also positives regarding Brexit and Trump and it’s important we take the bad with the good. So with these in mind, here are our tips to manage through the turbulent year of 2017.
Mitigating The EU Brexit Fallout
The day following the EU referendum will undoubtedly go down in history as one of the most volatile days in the history of currency exchange rates and things aren’t going to get steady just yet.
If for whatever reason you need to transfer large volumes of funds, whether its sending money back home or receiving money then you should definitely consider FX options. The digital remittance service TransferGo offers very competitive FX rates and has a tiny fixed fee of 99p per transaction. Definitely one to check out.
Only commercial foreign exchange companies are able to offer these to private clients, whereas banks can’t. These options include Forward Contracts which fix the current date’s rate for the next 12 months, so if the rates do fall again, you won’t be out of pocket.
Don’t Make Rash Decisions
Try to remain calm and not make any rash decisions, you don’t need to plan your move back to the UK just yet. It’s very hard to envisage that EU members would deport expats upon Britain’s official exit of the EU.
Remember the EU members’ treatment of their own nationals who live in the UK – if mass numbers of citizens were to be deported from their countries, it would likely perturb foreign investors which would cause turmoil in the various EU economy.
In terms of the crash of the pound then I’m afraid if you’re an expat, it may be time to scrimp and save for a little, and if you’re planning a move abroad somewhere then it’s worth thinking about putting the big move on hold.
Just last year, £100 would have secured A$200 in Australia – one of the most popular destinations for British expats – however, now £100 would only return A$169.
Australia isn’t the only place affected, the expat residents of the Costa Del Sol have found themselves living in a collapsed property market thanks to the pound falling almost 20% against the Euro.
If you’re a pensioner and an expat then unfortunately, your luck is really out. Currency is a major risk right now, and with over 1.2 million people living abroad who receive a UK state pension, which is either paid into a UK bank or into an overseas account in the local currency, recipients are being advised to use income from other sources, leaving their pension untouched until the pound recovers.
Donald Trump’s presidency, as bizarre and as catastrophic as it may seem, may not be the worst news in the world for expats so it’s worth keeping an eye on the situation in America as it may bring some calm into your life.
Trump’s plans to overhaul the US. tax system would benefit American expats abroad by lowering their overall tax bill, just as it would be if they remained in the United States. US citizens who make between $48,000 and $83,000 will save around $1,000 a year with the new plans.
With these money tips, you should be able to have a healthy, happy 2017.