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Exchange rate: What are your options if you live in France but have income in pound sterling?

The value of the British pound has fallen steeply against the dollar in recent days and also against the Euro, so what should you do if you live in France but have income - such as a pension, rental income or a salary - in pound sterling?

Exchange rate: What are your options if you live in France but have income in pound sterling?
The weakness of the pound causes major financial headaches for some Brits in France. Photo by Tolga Akmen / AFP

Exchange rates might sound like a spectacularly dull topic, but if you live in France (where, naturally, your day-to-day living expenses are paid in Euros) but have income from the UK in pounds, then the movement of the international currency markets will have a major impact on the money that ends up in your pocket.

And this is far from an uncommon situation – France is a popular retirement destination for Brits, who will usually be receiving a British pension paid in pounds.

Non-retirees might be still working for companies in the UK, with a salary in pounds, while others have income from rental properties or investments.

So a big loss in the value of the pound against the Euro has a major impact on Brits in France, many of whom – particularly pensioners – are already living on low incomes. 

The most recent fall in the value of the pound was sparked by the UK government’s new mini budget (we’re far from experts on economics, but the reaction from most economists seems to be that the budget is deranged) and has already seen a recovery. 

The pound-euro exchange rate over the last month. Chart: xe.com

But while this one-time fall is spectacular, it’s also part of a longer term trend in the fall of the value of the pound, especially since Brexit, that has seen some pensioners lose a big chunk of their income.

The pound-euro exchange rate over the last 10 years. Graph: xe.com

So if you have income in pounds, what are your options?

Euro income – obviously this isn’t an option for everyone, especially pensioners, but the best way to protect against currency exchange shocks is to make sure that you’re paid in the same currency that you spend in.

The advantage of the euro is that you’re not limited to finding work only in France, but could work in any EU country – including the anglophone ones like Ireland – and get your salary in euros.

What are the rules for foreigners working remotely from France?

Depending on your employer, it might also be possible for you to ask to bill in euros. 

Work in France – if you’re currently not working, then an obvious option is to take up some work in France – although if you are in France on a visa, you need to check whether your visa allows you to work.

Exchange rate – if your income can only be paid in pounds, it’s crucial to ensure that you get the best exchange rate possible and that you don’t waste money on international transfer fees.

The best options here are online banks or money transfer services, which compete on the rates that they offer, so usually have the most advantageous rate.

Some online banks also have the option to set up accounts in both pounds and Euros, so that you can receive money in pounds and spend it in Euros without having to make bank transfers, which can attract fees.

We spoke to a financial expert who explains the best options HERE.

Financial help – the French state offers fairly significant financial aid to people on low incomes, but while this generally comes automatically to French families, sometimes newcomers can slip through the net, especially pensioners who have never worked in France.

This autumn, for example, is a new €100-€200 chèque energie (financial grant) to help low-income households deal with the rising cost of energy bills.

In addition to one-off payments like this, you may also be entitled to top-up benefits or aid with making your home more energy efficient.

You can find out more HERE, and if you think you are eligible you can visit your local CAF office to ask how to apply.  

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