We have been saving ever since we made our first $ (or EUR), which is now about 6 years ago. At the time, it seemed wise to invest in some active investment funds (most from Carmignac:
http://www.carmignac.lu/ , see:
http://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F0GBR04F90 and
http://www.morningstar.be/be/funds/snapshot/snapshot.aspx?id=F0GBR04F8Y ). This worked out well given our short investment horizon and we came out of the 2008-2009 crisis almost unscathed. The problem is, of course, the costs. At 1.5-2.0% a year these are High. Furthermore, we reached our goal of buying a house and now we are all-in on the financial independence thing. So first simple question:
- do I move or stay? Do I simply free up all the money from these funds and immediately invest it in some worldwide tracker instead with low costs?
The catch is that EUR is devaluating at a terrifying pace versus the USD, and I am worried that the difference in asset allocations between active funds and tracker funds will cause me to buy a lot of very expensive US shares. Still, it sounds sensible to me to just do the move from active to passive and get this over with.
Similarly:
- what do we do with new investments? Do we assume an aggressive home bias and stick to Eurozone stocks? Or do we suck it up and just go for a worldwide tracker instead?
Again, there is a catch. About 40% of our income available for investments will be in EUR, whereas 60% will be in GBP. The GBP is solid as a rock versus the USD, and buying items in EUR using our GBP is like taking a toy from a child. Do we invest both GBP and EUR in worldwide trackers? Or do we make some kind of split? It sounds very much like market timing to me, but I'm not sure on this one ... . As for the currency we will need to retire, I frankly don't know. We have family in EUR, we have a house in GBP, we worked in CAD and we often travel in USD.
