Job Discussion Forums

fox1 · Joined: 22 Feb 2005 Posts: 268

Hi. This is a variation on the sending money home theme.

I want to send much of my savings home.

Does the Post Office (or any other method) hurt with the exchange rate? Do you lose a lot in the sending, aside from the �2500?

What do folks write as the reason for the transfer, given it's more than a token amount?

Cheers

Jon Taylor · Joined: 09 Mar 2005 Posts: 238 Location: Tokyo

It all depends where is home.

As a Brit, I will not be sending money home until the exchange rate is around the 200 mark.

Exchange rate history suggests it will go down again to the 200 mark against the pound though it may take a year or so.......

Regarding the reasons for sending large amounts.......savings will do.

kdynamic · Joined: 05 Nov 2005 Posts: 562 Location: Japan

Wow, you ask if "the exchange rate" will bite you without even saying what currency you are planning to exchange it into?? Uhhh... Well anyway, no matter which it is, it all depends on your timing. Exchange rates fluctuate.

fox1 · Joined: 22 Feb 2005 Posts: 268

Glenski · Joined: 15 Jan 2003 Posts: 12844 Location: Hokkaido, JAPAN

kdynamic · Joined: 05 Nov 2005 Posts: 562 Location: Japan

Willy_In_Japan · Joined: 20 Jul 2004 Posts: 329

I think what he means is, that aside from the money order fee, which gives a fairer rate of exchange, Lloyds or the Post office?

I havent tried Lloyds yet, but the Post office gives a very good rate of exchange. There is no gouging, except in the money order fee which recently went up 1500 yen.

may be going · Joined: 18 May 2004 Posts: 129 Location: australia

PUCK · Joined: 17 Jun 2006 Posts: 20 Location: Tokyo

In regards to exchange rates... I keep a close eye on the U.S. and Canadian rates as I have bank accounts in both countries. The past 18 months has been horrible for people working outside of those countries. I am sitting on a lot of $$ in Japan right now. If it's in my U.S. bank account I can get over 5% interest guaranteed. Close to the same in Canada. However, if I wait until the time that the exchange rate becomes more favorable, I could stand to gain huge dividends on the exchange alone. However, everyday that I wait, I lose on the 5%+ and get next to nothing in a bank in Japan. So, I lose if I wait and lose if I exchange! Any tips? At 5%, $200,000 US comes to $833.00 / month. That's enough to pay a nice chunk of one's rent or mortgage isn't it? Maybe I should send away???

kdynamic · Joined: 05 Nov 2005 Posts: 562 Location: Japan

You're sitting on $200,000 in japan earning no interest??? How did you ever get that much money in your clutches without knowing that YES you should invest it!!! You could also look into investing in Japan if you have that much capital.

markle · Joined: 17 Jan 2003 Posts: 1316 Location: Out of Japan

PUCK · Joined: 17 Jun 2006 Posts: 20 Location: Tokyo

Posted: Thu Aug 03, 2006 2:28 pm Post subject:

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shuize · Joined: 04 Sep 2004 Posts: 1270

Off the top of my head, the only reason I can think of to hold that much cash in the pathetic interest rate environment here in Japan is if you're trying to save for a down payment on a very nice house or property.

As noted above, by waiting, you're losing a fair amount of guaranteed interest income every month. But if you're willing to take that risk to speculate on the exchange rate, more power to you. Personally, I'd go with the guaranteed 7+ percent return. Of course, that may be because I've got my eye on semi-retirement and $200,000 @ 7% works out to almost $1,200 per month.

PUCK · Joined: 17 Jun 2006 Posts: 20 Location: Tokyo

Shuize, don't forget that if you go and pop your dough into the wrong oven, sometimes it will burn. You have to be really careful about currencies. Yes, I could probably open an NZ or AUS bank account and pop 150,000 in there ASAP. However, there are various things to consider. First, the currency I choose takes a dive, then I could end up losing thousands in the end. Also, in those countries, you have to pay a fairly high income tax on it. Therefore, the gains aren't as attractive as they appear.

At my US bank, the following are the current rates for CD accounts:

3 Month
(91 Day) $500.00
4.43%
4.50%
Maturity

6 Month
(182 Day) $500.00
4.94%
5.00%
Maturity

1 Year $500.00
5.00%
5.00%
Maturity

2 Year $500.00
5.00%
5.00%
Annually

3 Year $500.00
5.00%
5.00%
Annually

5 Year $500.00
5.00%
5.00%
Annually

11 Month Special Promotion $500.00
5.59%
5.60%
Maturity

18 Month Special Promotion $500.00
4.94%
5.00%
Semiannually

15 Month
Flexible CD*
(Not for IRA�s) $2500.00 ($5000.00 to open)
5.00%
5.00%
Annually

30 Month
Flexible CD**
(Not for IRAs) $2500.00 ($5000.00 to open)
4.94%
5.00%
Semiannually

If you have $100,000 or more, you can collect about 6% or almost that. This is US$ we're talking about. So not only is it a safe bet but it's also a profitable one. I'll probably grab an 11-month CD and pop another $100,000-$130,000 in it.

shuize · Joined: 04 Sep 2004 Posts: 1270

OK, then, (U.S.D.) $200,000 at 6% works out to $1,000 per month. But my overall view hasn't changed: if you're willing to take the risk, more power to you. Bigger risk means potentially bigger returns. However, I personally would not. In my case, an extra $1,000 per month could go a long way toward semi-retirement in Thailand or China.