The European Union has 27 countries as members and out of which 19 of them use the Euro as their currency. With some of the most established economies such as Germany, Italy and France using the euro as a unified currency, the eurozone attracts a constant flow of business opportunities through the ease of transactions, trades and investment. This in turn gives the euro stability as a currency, and here are some ways you can benefit from holding your funds in euro even as a non-EU resident:
Savings:
The euro is the world’s second most popular reserve currency, and its value is backed by an advanced market economy, making it one of the most stable currencies in the world. Even when there are external economic shocks such as a drop in world oil prices, the size of the eurozone can absorb its impacts and the euro stays relatively afloat. So for individual savers, the euro is a worthwhile option if one’s domestic currency is susceptible to depreciation or constant fluctuations.
Spending:
Needless to say, having euros in hand helps when you are planning to travel to Europe. As mentioned, there are countless worthy destinations offering both refreshing and historical experiences, all without the cost of converting from one currency into another. But even if you are not planning to go to Europe anytime soon, the euro can still be useful as it is the currency of choice for almost 40% of global cross-border payments and for almost half the EU’s exports worldwide. Again, with a stable value, paying in the euro avoids unfavourable exchange rate fees when online shopping or paying fees internationally.
Investing:
The EU’s economy is one sixth of the size of the world’s economy, offering endless rewarding opportunities for investors. However, investing in the EU market and converting back and forth into a foreign currency could spell significant foreign exchange risk. So to maximise efficiency allocation of capital and your returns, you should have your investments and savings in the same currency, in this case the euro if you are looking to expand your global portfolio.
Interested in knowing more about European IBAN account? Read “What is an IBAN and what is its use?“.