Forum Moderators: martinibuster
This has probably been mentioned lots of times before, but I was wondering if I could gain some advice? With the dollar against the pound at its highest rate for the last 30 years, I've had Adsense payments on hold for these last few moonths.
Do I just absorb the changes in the exchange rate and get the payments every month, or do I continue to hold payments until things improve? If I go with the former option, I get the money quickly, but this comes at a price. With the latter option, I can also perhaps look into a Citibank Dollar account, although the money could be waiting months, if not years before the situation improves.
On the upside having a US dollar account linked to a debit card could be handy for buying things from abroad priced in dollars. Could also be handy for any trips etc to the states.
What are you guys who are similar situations do / are doing?
I have thought about this too, but decided against holding payment.
Why? Imagine you had some money in the bank, would you be willing to invest it in American Dollars? I can't imagine the dollar recovering in the near future.
I have thought about this too, but decided against holding payment.
Also, the money would be gone if Google decides to close your account (for whatever reason).
So a Dollar account would be the better choice if you want to wait for the currency situation to improve.
I prefer monthly payments in my currency (EUR) as I don't expect any improvements soon - and if I make a trip to the USA or buy anything priced in USD I could still be pleased with the strong EUR (or GBP in your case).
I have thought about this too, but decided against holding payment
Ironically that thought occured to me awhile back when $US 1.00 = $A 0.75
Now it's around $US 1.00 = $A 0.94 for inward EFT
I'm sure glad I didn't do it. Oh for the glory days when it was $US 1.00 = $A 0.52
[ADDED]
Then again when I was importing from the US in the late 1970's it was to my advantage at $US 1.00 = $A 1.15 and I'm thinking we're heading back there.
[edited by: IanCP at 12:14 am (utc) on Nov. 10, 2007]
@OutdoorWebcams: That's a good point about the possiblity of losing the money. It's just difficult to bring myself to accept payments knowing the exchange rate has not been high since the 1970's.
The Citibank idea is quite promising, the only problem being that they charge $20 dollars per month to 'maintain' the account. You would get a debit card though, which means that I could pay anything priced in $ straight from the account. I could also pay any $ cheques into the account without fees.
Argh! Stupid USD =)
2 By getting paid every month by Google you are dollar cost averaging. In other words, you are smoothing out fluctuations and this is a very sound strategy.
3. If you held payments 6 months ago, you would be about 10-20% worse off now, plus you would lose the interest, another 1-2%. So that won't work either.
4. Don't be greedy. The exchange rate sucks, and it may continue to do so. Any effective strategy will cost you money either through hedging costs, lost interest and major exchange rate fluctuations. Short term hedging will cost about 3-5% of the value (Eg 3-5K on a $100K contract) using current exchange rates. If the currency stays at the same mark (or returns to it at the end of the contract), you will lose that $3000-5000.
