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Why is it important to choose the right currency for savings?
In Ukraine, in addition to the hryvnia, US dollars and euros are in demand, and British pounds, Chinese yuan, Swiss francs, etc. are also in use. Experts recommend properly distributing savings and keeping them in different currencies. A competent distribution will help reduce the overall degree of risk: if the exchange rate falls in one category, it may rise in another. Buying a stable foreign currency guarantees the security of personal finances and is important for several reasons:
- protection against exchange rate fluctuations and inflation;
- preservation of the value of savings;
- access to investment opportunities;
- diversification of risks.
The decision whether to buy the dollar or the euro depends on your financial goals, acceptable risks and available funds.
Factors that influence the choice of currency
Ukraine's economy is going through a difficult time, which is affecting the purchasing power of the hryvnia. Therefore, an increasing percentage of people are keeping their savings in foreign currencies.
The choice depends on several key factors:
- stability of the economy of the country issuing the currency;
- growth dynamics and inflation rate;
- interest rates on foreign currency deposits;
- the intended purpose of the funds;
- the possibility of investing in international assets;
- liquidity of money.
You should not keep all your funds in one currency, no matter how high its status. To choose the best option, you need to determine your own capabilities and goals, as well as the characteristics of monetary units For example, you can download the GlobusPlus app and apply for a foreign currency card, which allows you to open and replenish foreign currency deposits, receive transfers from abroad, and pay for online purchases.
Comparison of popular currencies: is it better to buy dollars or euros
The stability of the world's major reserve currencies minimises the risks associated with exchange rate fluctuations and allows you to preserve your personal savings. Given the depreciation of the hryvnia, experts advise forming a currency basket on a 50/50 basis, with 50% hryvnia and the other half in dollars and euros in arbitrary proportions. This distribution allows the state currency to be used for current expenditures. There is also another methodology where the hryvnia share accounts for only 25%, the same amount is converted into euros, and half of the savings consists of US dollars.
To decide whether it is better to buy a dollar or a euro, you can evaluate these two units by the following parameters:
- Reputation and distribution. The dollar has served as a measure of the value of other currencies for many years and has a wide reach. The euro has also established itself as a reliable currency and is widely used in European countries.
- Economic stability. The dollar is generally considered to be a more stable currency, while the euro can be a profitable asset if the Eurozone countries grow economically.
- Actual use. Keeping money in euros is beneficial for people who periodically travel to Europe, study or work there. If you plan to visit the US or other countries where dollars are used, it is better to choose this currency.
- Cost. In Ukraine, the euro is worth slightly more than the dollar, but the situation is subject to change due to the current political and economic situation.
Experts believe that it is advisable to buy US dollars to create a personal reserve.
Where to keep money in different currencies
You don't have to make a one-sided decision about whether the dollar or the euro is better. You can keep money in different currencies and diversify your risks. Cash is not a very convenient option, because in this case, the funds do not work. For currency transactions, you can open a free online card in the GlobusPlus app. It makes it easy to pay for online purchases and receive transfers from abroad in euros and dollars.
The best solution is to make a profitable foreign currency deposit in the Globus Plus app. The maximum deposit amount in dollars and euros is not limited, and users can replenish their deposits throughout the entire term of the deposit. The total amount of replenishment should not exceed 200% of the initial deposit amount. Funds can be deposited from a GlobusPlus card, another available card in the app, using the details, or from a card of another Ukrainian bank. Interest is paid monthly to the account selected at the time of registration, and the deposit is repaid upon maturity. The safety of the funds is confirmed by the Deposit Guarantee Fund.
Given the current economic situation in the country, experts advise reducing the risks associated with exchange rate fluctuations and keeping money in different currencies - euros, dollars, and hryvnia. The size of the shares in the savings portfolio should be correlated with the expenses. The currency in which suppliers pay for goods or services, or the currency in which you plan to spend money, is the currency in which you should accumulate savings.
