How to use the devalued rand to create global wealth

*This content is brought to you by Wealth Migrate

Why invest offshore? Surely it is easier to invest your rands into local properties and earn rands, and isn’t it easier to earn R18 than $1?

Yes, that is absolutely true, and there are fantastic opportunities right here in South Africa to take advantage of. However, if you have the extra cash it makes a lot of sense to invest in First World assets too.

When you are investing with rands in local assets, you are completely at the mercy of the highly volatile and devalued local currency. Even when you take into account how unpredictable global markets are at present, it still makes a lot of sense to invest in other parts of the world.

The adage of not keeping all your eggs in one basket applies – both in terms of a mix of assets and a mix of geographies. To get the make-up of your portfolio just right ensure you have an experienced and trustworthy guide to keep your expensive lessons to a minimum.

The global financial crisis of 2008 scared everyone and made many people wary of property, but when you are investing with rands you have a built-in buffer in the event that your chosen First World property market loses value. If the rand weakens substantially, you score when you convert the First World currency, we have earned back to rands.

As the world remains uncertain, the chance of the rand falling further against the dollar remains high. Even if your investment in the US hardly budges in terms of value, you will benefit when you change the dollars you have earned back into rands.

The best way to protect your wealth is to put some of it outside the country so it is immune from the vagaries of rand’s decline.

Even if you have no plans to relocate and to stay in South Africa for many more generations, owning properties in First World countries is a tried and tested wealth preservation strategy. You can rest easy knowing that you are earning a First World currency for you and your family.

To benefit from this approach, you need to choose your target country with care. It makes little sense to take your emerging-market currency and invest in another emerging market. This is why is helps to have some guidance on your investment journey. Online portal Wealth Migrate, for example, helps clients invest in properties in the US, the UK and Australia.

Taking your money and investing offshore is risky, like any investment is, but it can set you on the path to creating global wealth, preserve your existing wealth and give you real peace of mind.

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