Uptrending $US cash - best strategy?

[Bill M]

I think the longer-term target would be .80c for AUD as a MINIMUM...US$ will be VERY strong in the next several years which will shock a lot of people as all they know is US government has printed too much money and the only way for US$ to go is down...all the way to hell...and they'll be shocked at what actually happens. and that's one of the forms that wealth changes hands lol

If you know all this "as a minimum" (as you say) then why are you even asking this question?

 

[pinkboy]

There is no flexibility like having paid off the mortgage!

Not entirely correct, and less flexible if you have your PPOR mortgage 'effectively' paid off through the use of an offset account.

The offset account on your PPOR gives you the benefit of cash 'at call' should you ever need it (such as operation, holiday, new car etc), or the greatest advantage is the 'portability' of the cash should you ever move PPOR.

If you buy a new PPOR and have the loan fully paid off on your old one, then you have to re-borrow money which is effectively a new non-deductable debt. The double whammy is if you rent out your old PPOR, there is no deductable debt to offset the income, so the full income will be added to your income, which may push you up a tax bracket.

Had you had your loan fully offset on your PPOR, you could take that cash straight out off the offset to purchase your new PPOR (in a new IO loan with offset), and when you rent out your old PPOR, there is full deductable debt on the place, which offsets the income (plus depreciation, outgoings etc). Otherwise, you would have to sell your old PPOR outright and use the sale proceeds to your new PPOR. (And there could be CGT if you purchase new PPOR and rent out old PPOR prior to sale, but we wont get into that).


pinkboy

 

[cestlavie]

I just realised I omitted something which may have caused some kind of misunderstanding...

I'm not a FX trader and my US$ cash isn't from FX trading profits. May consider start to learn how to trade FX. and that's why when I asked my questions I did mention that it has nothing to do with FX trading...

If you know all this "as a minimum" (as you say) then why are you even asking this question?