Taking advantage of our high $

By Steve Biddle, in , posted: 21-Oct-2009 19:42

Right now the NZ$ is at a 15 month high against the US$ - this means it's a fantastic time to be buying imported goods!

As we all know however, things aren't going to stay anywhere near the current 75c value and at some stage our currency is going to drop. If you're somebody who buys goods regularly from overseas you can take advantage of this current situation and hedge your money for a rainy day.

Many banks are now offering prepaid credit cards in foreign currency. These cards are great for travelling as they allow you to buy funds in a foreign currently such as US$ and use the card in the USA without incurring any transaction fees (unless you withdraw cash from an ATM). Your money is also locked in at the exchange rate at the time of purchase, something that's fantastic for us right now.

I purchased a ANZ Travel Card when I was stopping in the USA earlier this year. The card costs $12 to buy and $10 every time it's reloaded. The bank does take a small commission when money is loaded but in my experience with several topups it's a lot lower than the usual fees incurred with foreign credit card transactions.

The beauty of this card is that the value of the card is in US$ and fixed at the time of purchase. This means if you top up US$1000 to your card at this very moment you'll gain significantly if the value of the NZ$ falls. Any purchases you make in US$ online are deducted from your balance, unlike a regular credit card that is converted using the current exchange rate.

I'd probably buy somewhere in the region of $500 - $1000 worth of goods from the USA yearly. These are typically books of Amazon or goods from eBay. By topping up my card now I can take advantage of the card should our currency fall as any purchases will effectively be at the ~73c rate that I purchased my US$ at.

If you're somebody who regularly buys goods from the USA or online in US$ a card such as this is something that's well worth investigating. I know most banks are now offering similair cards and Travelex are also. We all know our currency isn't going to stay high for ever - why not take advantage of the current rates while you can!

Other related posts:
Fairfax takes journalism ethics and integrity to a whole new low with Stuff fibre
Why are airport taxes and service charges so high on Trans Tasman flights between New Zealand and Australia?
Flight reviews – Air New Zealand NZ87 Auckland (AKL) to Hong Kong (HKG) in Premium Economy and Air New Zealand NZ 80 Hong Kong (HKG) to Auckland (AKL) in Business Premier on the 777-200ER

Comment by chiefie, on 21-Oct-2009 23:09

Good idea! Do you know if ASB Bank has something like this? I know NZPost offers Travelex.

Comment by Fraktul, on 21-Oct-2009 23:25

or you could just get an FX call account and earn interest on your investment whilst being able to shift it round more easily to take advantage of exchange rate swings

Comment by euanandrews, on 22-Oct-2009 15:56

I would love to take advantage of the high NZ $ right now, and buy my Nokia N900, but I'm still waiting for its release...sigh.
Murphys law sez by the time the Nokia N900 is released and available here in NZ...the NZ $ will have plummeted!

Comment by dacraka, on 22-Oct-2009 18:55

I think the news just said tonight that it is expected to go to 82c and stay there for a while.

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sbiddle's profile

Steve Biddle
New Zealand

I'm an engineer who loves building solutions to solve problems.

I also love sharing my views and analysis of the tech world on this blog, along with the odd story about aviation and the travel industry.

My interests and skillset include:

*VoIP (Voice over IP). I work with various brands of hardware and PBX's on a daily basis
  -Asterisk (incl PiaF, FreePBX, Elastix)

  -xDSL deployments

*Structured cabling
  -Home/office cabling
  -Phone & Data

*Computer networking
  -Mikrotik hardware
  -WAN/LAN solutions

*Wireless solutions
  -Motel/Hotel hotspot deployments
  -Outdoor wireless deployments, both small and large scale
  -Temporary wireless deployments
*CCTV solutions
  -Analogue and IP

I'm an #avgeek who loves to travel the world (preferably in seat 1A) and stay in nice hotels.

+My views do no represent my employer. I'm sure they'll be happy to give their own if you ask them.

You can contact me here or by email at stevenbiddle@gmail.com