sophia

Hi guys

Not wanting to show myself up as thick here, but I've read a couple of threads complaining about the currency exchange from £ to $'s and vice versa and I'm a bit confused...

Lets suppose I have an exchange rate of $2.5 to the £ (Obviously I'm hoping it'll be MUCH better, but for ease of conversion lets use this) and I've got £100,000 to exchange..this gives me a princely sum of $250,000 right? So if I then buy a house for that amount and then 5 years down the line decide I don't want to stay in Oz, surely when I do the exchange back into sterling I'll get pretty much the original amount back (give or take a bit depending on the exchange rate at the time)....So why then are people complaining about the weak dollar??? If you've got £100,000 in one currency, surely you've still got £100,000 but in a different currency???

hmmm, it sounds right to me, but am I missing something...or are they???

confused sophia xx

dougp

As far as the money you take with you is concerned, that's absolutely right. Where you lose out is on savings, pensions etc. that you may accumulate in $. Savings of, say $25,000 would be a nice little sum in Australia, but would be reduced to £10,000 if you came back to the UK. If you had stayed in the UK in equivalent circumstances you may have saved £25,000 in the same time.

Solution - don't come back!

sophia

ABSOLUTELY!!!

Thanks doug,

I sort of get it now...I guess your money doesn't go as far the other way around, but then I'm not doing this to make money I want a complete lifestyle change

love sophia xx

iancurtis

Good point Sophia but lack of money can really mess up your lifestyle. We both have good jobs here in the UK, with a lovely home and great friends but we work really hard just to pay the bills. We have hardly any spare cash at the end of the month and we don't live extravagant lifestyles - our money goes on the basics - mortgage, cars, petrol, food, etc. So we have no money left to do the things we want to even if we had any spare time (which we don't as we're working all the time to pay the bloody bills !!!!)

I can't see a way out of this staying in this country. Indeed as we plan to have kids in the near future, it'll just get worse with less money coming in and more money to fork out.

So for us, moving to Perth immediately frees us from the 'work - pay bills - work - pay bills' cycle as, with the money we'll get from selling the house in the current climate, we can afford to purchase a really nice home outright and have money left over to get a second-property to rent out as an investment. In one quick move, we've removed the financial stranglehold from around our necks and set ourselves up nicely for the rest of our lives.

Then we can actually relax and enjoy being with each other and our children without that constant drain on our time and resources.

I think some longtime ex-pats in OZ underestimate the affect this one-time financial uplift can have on your life.

newstartnz

We wouldn't be going to NZ quite so enthusiastically if we had to rely purely on money coming in from job income there. Based on our research of likely earning power there and what we expect to budget for outgoings, we'd feel pretty poor, however great the lifestyle. Thankfully we both worked bl**dy hard all our lives and always saved instead of blowing everything on fast cars, clothes and holidays and so will have a bit of extra capital to lean on if need be.

TomK

But doesn't this really show that the economy in the UK is good in many ways? You have been able to save a lot of money (by owning a house), enough for two properties in Australia. Something perhaps not many peope in Australia could do themselves.

Gareth W

On this board, a lot of aspects of British life get criticised (as you might imagine seeing as its a forum for people wanting to leave the country !) but the economy doesn't get slated much.

It seems to me that the British economy is in pretty good shape - certainly if measured by unemployment and inflation rates. The most commonly mentioned "downsides" to GB life tend to be more like :-

Declining public services (NHS, roads schools etc)
Crime rate and/or drugs issue
Weather
Over emphasis on work, mortgage, keeping up with the Joneses.

I'd guess that most people are not going to Aus/NZ to make money but to enjoy a higher standard of living in the broader sense.

sophia

Hi guys

thanks for the responses. Good to know I'm not stupid!!

Ian, I agree with you, we bought our £50,000 2 bedroom house in Wakefield 5 years ago. We had a good income between us and seemed to spend our money on bills, mortgage, life insurance etc etc etc...we do not have an extravagant lifestyle...on the contrary but we never seemed to have money left over for savings or holidays or anything remotely luxiourious. To put it mildly we were fed up with the constant work to pay bills cycle and wanted more from life.

Since we had to deal with my illness and the birth of our son our priorities have changed significantly and we do not want our son to grow up thinking that this mad frenetic lifestyle we all seem to aspire to in the UK is "normal".

We can afford to buy a house outright and have some money in the bank in Australia which is something we'd never achieve here (well, perhaps when we're old and grey) plus our son can grow up with, hopefully a much more balanced approach to life than the one we seem to be pushing here in the UK...and the best thing of all is that we will be able to afford for ME to bring up our son and not a stranger, which is all I ever wanted as a mother.

It is good to know however, that I'm not missing anything and we do not suddenly "lose" a third of our money should we ever decide to come back to the UK!!

love sophia xx

newstartnz

I reckon more of us than just you have had an experience that puts life into new perspective. For me - typical multinational manager working hard, playing hard, no time to 'sit and stare', as I used to be - getting made redundant, marrying and starting a family have made me change my outlook considerably. I still like to work hard, but will definitely in future be much more conscious of how important a good work/family balance is, and related to that how important it is to be healthy of mind and body. (Platitudes schplatitudes - no! I mean it!) The NZ choice made itself in some ways, I'm newstartnz in more than just handle!

All the best

sophia

Hi NewstartNZ

I'm sure that there are many experiences that change a person's perspective on life it's just that ours was more er.. in your face than most. Ours was a shocking jolt of reality that hit us hard. That said I agree with what you're saying, it's sooo important to get a balance between work and home life..preferably with the correct emphasis on homelife which is disgustingly hard to do in the UK unless you are loaded

love sophia xx

Rob

In <[email protected]> dougp wrote:
    > As far as the money you take with you is concerned, that's absolutely right. Where
    > you lose out is on savings, pensions etc. that you may accumulate in $. Savings of,
    > say $25,000 would be a nice little sum in Australia, but would be reduced to
    > £10,000 if you came back to the UK. If you had stayed in the UK in equivalent
    > circumstances you may have saved £25,000 in the same time.

I'm not saying your wrong, but can you point to evidence that shows for comparible
circumstances people save £1 in the UK for each $1 is Oz.

Interest for savers is better in Oz right now than in the UK. Even after paying
higher taxes your Oz dollars grow faster than £s.

newstartnz

Sophia, you're right, I wasn't trying to say being made redundant tc is the same as a serious illness. You must have been through hell and back. (And your family too. That takes a lot of strength and courage and inner resilience.) I just got lucky as it's what I wanted (it turns out) anyway. Hope you stay very clear in future, from what I understand the prognosis is usually very good for 1 year 'good healthers',

all the best

dotty

Work for 10 years in Uk, average income say 23000 pounds,
work for same in Oz earn average $40,000. Now convert to any currency you fancy which person has a bigger net worth?
Add UK property growth 20%, add average aussie property growth 7%. What are you property assets worth? Now see why Aussies are poorer. After 10 years your up the creek. I think the accountant on here called it the Dollar Trap.

davo

How much your savings grow also depends on inflation. I wont pretend to know what the inflation rates are in Oz and the UK but headline interest rates are only half the story.
Everyone has to weigh up their own individual circumstances financially, if that is a factor in your migration decision. Obviously it may not be and I applaud those who have a mature perspective on quality of life. Long may it last.
An example of different financial circumstances for those who are interested - A friend of mine was an underwriting manager and in the UK he was earning 25,000 pounds but in Sydney he earns $125,000, multiplying is income by 5, so he has managed to beat the so called 'dollar trap' by being in a job that pays comparatively much more in Sydney. Whether in the long run he will be better off is an unkown, depending on career prospects etc etc.
My own circumstances are very different as in Sydney you just change to pound sign to a dollar sign and add 20% in my profession, which means a fairly significant pay cut in real terms. Financially I am far better off being in the UK, exchange rate purchasing parity theory or no exhange rate purchasing parity theory.
You can not generalise about whether everyone will be better or worse off in Australia/UK. Everyone is different and its driven by the economics of demand and supply for your profession in your chosen Australian city versus your UK city, and the recognition given for your qualifications by employers. A great example in reverse is that one of my colleagues was here in Sydney earning $100,000 as a chartered accountant and she recently emigrated to London where she has been forced to accept secretarial work on 20,000 pounds. Another colleague of mine is a UK educated Australian chartered accountant who was the same grade as the woman and he also recently emigrated from Sydney to London. He is working in an investment bank earning 100,000 pounds. The difference - one has a UK education and qualifications, the other has Australian qualifications, one is a man, the other a woman.
Sorry to be boring but I am an economics graduate and also chartered accountant so tend to get frustrated by ignorant generalisations. Do your research and you may find you will be better off, you may find you will be worse off. From what I have read most people seem to be of the opinion 'who cares' anyway.

Russell Driver

"sophia" <[email protected]> wrote in message news:[email protected]...
    > Hi guys
    > thanks for the responses. Good to know I'm not stupid!!
    > Ian, I agree with you, we bought our £50,000 2 bedroom house in Wakefield 5 years
    > ago. We had a good income between us and seemed to spend our money on bills,
    > mortgage, life insurance etc etc etc...we do not have an extravagant lifestyle...on
    > the contrary but we never seemed to have money left over for savings or holidays or
    > anything remotely luxiourious. To put it mildly we were fed up with the constant
    > work to pay bills cycle and wanted more from life.
    > Since we had to deal with my illness and the birth of our son our priorities have
    > changed significantly and we do not want our son to grow up thinking that this mad
    > frenetic lifestyle we all seem to aspire to in the UK is "normal".
    > We can afford to buy a house outright and have some money in the bank in Australia
    > which is something we'd never achieve here (well, perhaps when we're old and grey)
    > plus our son can grow up with, hopefully a much more balanced approach to life than
    > the one we seem to be pushing here in the UK...and the best thing of all is that we
    > will be able to afford for ME to bring up our son and not a stranger, which is all
    > I ever wanted as a mother.
    > It is good to know however, that I'm not missing anything and we do not suddenly
    > "lose" a third of our money should we ever decide to come back to the UK!!
    > love sophia xx
    > --
    > Posted via http://britishexpats.com

So you live in Wakefield Sophia, I moved from just up the road in Pudsey,Leeds.


IF the exchange rate is constant money should not be a worry,we saw nearly $3 to 1
pound when we came out to Adelaide 2 years ago. We got rid of the "in debt to live"
syndrome but I dread to think of moving back to the expensive UK / or just visiting.
You very quickly become accustomed to the prices here ;-)

It was only a few years back that the rate was $2 to 1 pound so if you did return
your capital has a chance of diminishing.

Russell


--
Luck is when the paths of opportunity and preparation cross.