Home » Good News For UK Expats Moving Abroad As Sterling Continues To Strengthen

Good News For UK Expats Moving Abroad As Sterling Continues To Strengthen

by Simon Hilton, senior foreign exchange consultant at World First and official Expat Focus foreign exchange partner

When a new year arrives, it can be tempting to set ourselves goals that we want to achieve in the coming 12 months. These could range from small things like keeping fit, learning a language or eating more healthily, to big ambitions like moving abroad, buying a house or getting a job overseas.

For those with such goals in mind, or people already living or working abroad, the exchange rate is all important, as it determines how far their money will go when buying a property or sending money home, for example.Well, we’re now more than a month into the new year, and if you’re still standing by your resolution to move abroad, now may just be the perfect time to do it. Your pounds will now go further than they have done for a long time, and you’ll get more for your money.

The recent strength of sterling has coincided with an improvement in the performance of the UK economy over the last few months, and a stream of favourable news coming out of the UK. We found out a few weeks ago that UK unemployment had fallen to 7.1% in December, and it’s data such as this that has helped sterling to its current high level and enables expats looking to buy overseas to get a better property than they would have done, say, just a year ago.

Taking a look at the current exchange rates alongside the rates from 12 months ago, it’s clear to see that your money will now buy you more. At the end of January 2013, the GBPEUR exchange rate was at 1.1733, whereas at the end of January this year, it sat at 1.1659. Back then, £200,000 would have got you €233,180, but now, that same amount is worth €242,600 – a difference of over €9,000. Furthermore, at no point in the last year has the GBPEUR rate been higher. In fact, over the course of the last year it’s twice been down as low as 1.15 (March and August), further highlighting how far your money goes now. Transferring £200,000 when the rate was at that level, you’d have got €230,000 – that’s nearly €13,000 less than you’d get now. These dramatic fluctuations could make all the difference when it comes to determining whether you can afford that house abroad that you always wanted; it could be the key to securing your dream home.

GBP’s also looking strong against the US dollar right now, with GBPUSD having recently come close to a 32 month high. If you were transferring pounds into dollars now, £300,000 would get you around $497,000. A year ago, the same amount would have been worth about $472,000 – a $25,000 difference in the space of a year.

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That’s 25,000 reasons to consider using a currency broker for your international transfers. While you could go it alone and try and wait for the best rate, it’s also advisable to protect your funds in case the market move against you. One of the most popular methods is to fix a level in advance while the going is good, for a currency transfer in the future. Then, should the exchange rate go against you in that time, you won’t lose out, having already agreed an exchange rate. This is also helpful when budgeting, as you’ll always know what you’ll pay.

If you’re a UK expat looking to buy in Europe or in the US, and you need to make regular transfers to pay for property maintenance or a mortgage, a currency exchange company will enable you to set up an automatic transfer so you don’t have to lift a finger when it comes to making a payment. Plus, if there’s a particular rate you were hoping to achieve, you should be able to sign up to rate alerts that let you know the moment it is available.

The decision to move or buy abroad is a huge one, with so many things to consider. But right now, with sterling strength on your side, there may never have been a better time to take the plunge.

Simon Hilton is a senior foreign exchange consultant at World First specialising in assisting private clients and companies with their foreign exchange transactions. Simon is authorised by the FSA to offer foreign currency options. Contact Simon today for a free, no-obligation currency transfer quote.

World First transacted over £4.7bn for their 40,000 clients in 2012 and have a 2A1 credit rating from Dun & Bradstreet – the highest possible rating for a company their size. As well as tailored hedging solutions designed to protect you from adverse market movements, they also offer excellent service. Winner of the Client Focus Award at the 2012 National Business Awards, they provide personal service with a dedicated dealer, and a regular transfer service, which is perfect for mortgage or rental payments.

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