money

[c1]

with interst rate around 17.5 % from turkish banks, would it be worth my while moving £100+k into turkish banks with a veiw to living off the interest, also what is the likely hood of the money being at risk? we still intend to live for the most part in uk, but would take out cash to uk for conversion to sterling.a good idea or just losing to much in bank charges ? [)]

[Scunner]

Charges won't make too much of a dent in your plan, but for those not living here the exchange rate is relevant. 2.8 YTL to the pound and 2.2 to the pound are common exchange rates and can be both within relatively short periods of time - and 0.6 of a lira may not sound a vast amount (26p now) but change your sterling into Lira now at 2.2/£ and take it back in the future at 2.8 and you just lost £21,500 of your money.

[c1]

surely that would be if I took the money out in sterling from a turkish bank, were as what I entended was to take lira out and exchange in uk, or would the same fact await me here in uk, as when I have searched around the charges /fall off is around 2% not 20%. does that make sense.

[Scunner]

Same thing - your interest MAY be wiped out (and more) if the exchange rate goes the wrong way.

Think about it as £1 rather than £100,000; You bring over £1 and buy lira (exchange it). The bank give you 2.2 Lira (because the rate is 2.2/£. Later you want to take your lira and turn it back into sterling (in UK or Turkey, doesn't matter) and the rate is 2.8/£.

To get your pound back, you have to give them 2.8 lira. So it costs you 0.6 lira (over 20p) more to buy your pound back that you got for it.

Then finally multiply all those 20p's 100,000 time for each pound you put in []

I'm not saying it's a bad idea, it could be a very good idea if the exchange rate went the other way over the time you invested the money (in which case you would be investing a pound, then when you come to exchange back they would want about 80p for each one and you made 20p x 100,000   ) plus the interest of course.

What I am saying is it you would be investing  huge sum in a market that your own personal skills have no influence over. If the Lira needs to be devalued your 220,000 YTL which was worth £100,000 could be worth half that overnight. It's unlikely but not impossible.

You could make a lot of money, but you could lose just as much. Where it is different for people living here is that the exchange rate is not relevant. You bank lira, you spend lira. What the pound is worth doesn't matter to everyday life.

I hope that made a little sense  

[c1]

sure did keith I was unaware of the vast difference / bank rate between buying and selling I thought wrongly as it would seem that 5% difference would be the case.I might put some in for holidays and live of the interest while there. will see you in march as have place to sell.