One of the most frequent questions we get asked by clients is whether or not they should wait for the exchange rate to improve before moving their money offshore.
The simple answer, of course, is that you should always leverage the best exchange rate. The hardest part, of course, is knowing exactly when the exchange rate will be most favourable. If it were as easy as that, most people would be managing their cross-border finance themselves, as there would hardly be any need for specialists.
Learning from your mistakes
If the past few months are anything to go by, there really are no safe bets when it comes to South Africa and the world’s economy. After the Chinese economic slowdown in 2015 shook up international markets, South Africa faced an earthquake of our own as President Jacob Zuma kickstarted a period of political confusion with the axing of our finance minister.
The world is in flux – with refugee crises, political upheaval, splits and mergers and widespread uncertainty. Some of the biggest economies worldwide are in various stages of reform,and unfortunately third world countries draw the short straw. The fact remains – the worse off your economy at present, the less adept you will be as a country to survive financial shakeups.
The best financial advice for anyone who wants some stability is undoubtedly to play it safe and stow your money in the safest place. That, of course, undoubtedly leads to the conclusion that ‘elsewhere’ is much safer than South African shores. We’ve learned from our mistakes and accepted that sometimes it simply makes more sense to act soon and play it safe.
Say what you will about our beautiful land – the same does not go for the Rand. Irrespective of whether or not you find yourself on South African shores or living abroad – our local currency simply is not leading the pack at the moment, and analysts believe this will be the case for some time to come.
But won’t the South African economy recover?
Of course South Africa could make an economic comeback, and there definitely are, and will be investment opportunities for the financially savvy individuals. But you need to ask yourself whether you have to knowledge and money available to make that gamble.
The second factor you need to consider is whether you plan to retire within South African borders or not. If you are living abroad, the smart choice would undoubtedly be to transfer your retirement savings offshore for reinvestment in a stronger currency. Even if you do plan to return to South Africa one day – your retirement will be yours at no tax. As a local, of course, there are foreign investment opportunities which will allow you to enjoy the Safa sun while earning foreign interest.
The conclusion? Move your money now!
If you ask most expats, the time to move is sooner rather than later. Knowing where to start is another matter altogether.
But cashkows.com can help you out in four easy steps:
- Find out if you have any unclaimed policies and retirement annuities that you can cash in, simply register for a FREE report.
- A cashkows.com licensed financial consultant will contact you, discuss your personal needs and offer you appropriate advice.
- Should you engage the services offered, cashkows.com provides a turn-key solution to facilitate the total process from start to finish. All services are rendered in-house ensuring that your personal information is protected at all times.
- Once your money is in your bank account in South Africa, you can then decide when to exchange your Rands into foreign currency and remit it offshore.
Rather be safe than sorry. Get your finances in order – cashkows.com can help you out.