Protect Yourself Against Currency Fluctuations

EXPERT ADVICE PROTECTING AGAINST EXCHANGE FLUCTUATIONS

BY KRISTEN BURKE

As businesses in the United States struggle in the wake of the COVID-19 pandemic, they’ve had to mitigate risk, preserve cash, and implement strategies to protect themselves from turbulent economies, both domestic and foreign.

Foreign currency exchange rates can fluctuate greatly due to factors like unemployment, civil unrest, trade deals and more, and these fluctuations can translate to unanticipated losses for your business.

For example, if your business makes a deal to sell a product to a company in Germany for 50,000 Euros, and at the time of the deal, a Euro is worth approximately $1.10 U.S. dollars, your business would expect proceeds of $55,000.

However, if the exchange rate drops by the time of delivery and payment to $1.04, you would only net $52,000. Ultimately that foreign exchange fluctuation would cost your business $3,000. And that’s just on one deal.

Obviously, if the exchange rate goes up, your business could potentially benefit, but it’s a gamble. Fortunately, there are a number of strategies your organization can implement to reduce the risk of losing money due to fluctuations in foreign currencies.

• Deal Only in U.S. Dollars.

Perhaps the easiest strategy is to only invoice or pay in U.S. dollars, thereby removing any exchange or transactional risk. However, some foreign partners may charge you considerably more if they have to take on the exchange risk themselves.

• Open a Foreign Currency

Bank Account. Another option is called “matching,” where your business opens a foreign bank account and uses foreign currency payments to pay foreign suppliers. Again, this reduces the risks involved with the need to exchange funds.

• Negotiate a Foreign Exchange

Contract. A popular and effective hedging strategy is to use a foreign exchange contract, where your business and your foreign partner lock in an agreedupon exchange rate for a set date in the future.

• Conduct a FX

Swap. A foreign exchange swap (FX Swap) is appropriate if you need a foreign currency for a short term and then will need to trade back to your base currency. This involves two transactions: the purchase of one currency for another, and then, purchasing back your original currency at an agreed upon point in the future via a foreign exchange contract.

• Perform a Currency Swap.

A foreign currency swap is an agreement between two parties to swap the principal and interest payments on a loan made in one currency, for payments of equal value in another currency.

If your business is taking out a loan in a foreign country, this strategy may give you better interest rates.

Bottom line: During these economically challenging times, strategies to minimize the impact of foreign currency fluctuations on a company’s operations could protect margins and reduce operational risk.

Kristen Burke is senior vice president and Commercial Banking Division head for Queens, Brooklyn and Long Island for Valley Bank. She can be reached at (516) 465-2359 or Kburke@valley.com.

STEPS TO HELP YOU ACHIEVE YOUR GOALS

BY FAZEEDA ABDUR-RAHMAN PH.D., LCSW

It’s a new year, which means for many of us we would like to embark on experiencing new and better things.

We may think about how we can improve ourselves, our lifestyles, and our relationships with others in our lives.

BALANCE

As we think of goals we want to achieve in different areas, be it health, wealth, career advancements, or growth in other ways, it’s important that we take a holistic view of what we need for our betterment, as well as for the betterment of our relationships with others.

As we plan ahead, an important theme I believe is balance. Whatever our goals may be, it’s important to keep them in proper perspective and consider how to achieve them in a way that allows for wellness mentally, emotionally, and physically, as well as spiritually.

Deciding on our priorities and balancing time put towards our goals according to our values can help align us in the right direction. Goal attainment is important, but not important enough to jeopardize health or relationships.

CONSISTENCY

As a mental health professional that focuses on supporting women, I often hear about the difficulties of goal attainment. Common goals for women are self-growth and weight loss.

Women may start off on a strong path toward achieving their goals, but sometimes because of exhaustion or laziness, progress becomes less and less, or may even stop altogether. Starting off with big goals is an important early step towards goal attainment, but implementation is also important. No matter the specific goal, the best way to achieve them is through consistency.

Consistency can be a big challenge for many of us, especially if we have no one to hold us accountable, so obtaining help to keep focused is important.

Dr. Fazeeda Abdur-Rahman is owner of Vibrant Women Wellness Counseling (VWWC), a Christian-based mental health company located in Queens. She can be reached at drfazeeda.rahman@gmail.com or (718) 844-5390. Learn more at vibrantwoman.me.

FOCUS

Figuring out how we can keep moving towards our goals can be the difference between success and failure. An important step is getting focused. One way to do this is by having an accountability person to

EXPERT ADVICE THE IMPORTANCE OF FIRE & LIFE SAFETY

Whether you have a commercial, industrial, or residential building, prioritizing fire and life safety is very important. An all-encompassing fire and life safety scheme for your building may include fire suppression and alarm systems, alarm monitoring, and inspections and maintenance of your fire protection systems.

There are two main reasons why fire and life safety systems are so important for your facility. The first is that they can save lives, and the second is that they protect property.

SAVING LIVES

Installing life safety and fire protection systems in your building and keeping them well maintained can save lives. As a building owner or property manager, protecting the people who occupy your property should be your most important priority. Providing a safe place to live, work, shop, or be entertained requires a fire and life safety scheme.

Fire sprinkler and suppression systems are designed to control or suppress a fire to prevent it from growing to the point that it becomes deadly to people. Alarm and detection systems allow building occupants to safely escape a building during a fire. Voice communications

Gus Sebo is Inspections Account Manager with W&M Fire Protection Services. He can be reached at (866) 815-5885. A technician from W&M inspects a fire protection system.

systems can direct people on the course of action to take during an emergency.

An alarm monitoring system can send the proper authorities to your location faster during an emergency, which can save lives.

In New York City, the prevalence of high-rise buildings makes prioritizing fire and life safety even more important. If a fire occurs in a high-rise building, occupants on higher levels will need more time to safely escape the building. Having the proper fire and life safety measures in place will buy the critical time needed for occupants to escape safely.

PROTECTING PROPERTY

Fire protection systems can reduce damage to your building, expensive equipment, important documents, inventory, and other valuable or irreplaceable assets. By protecting your building, you could also be protecting homes or jobs that would be lost if your building was damaged.

Often, fire sprinkler or suppression systems can contain fires to their area of origin, which limits damage to your property. Some fire suppression systems can even suppress a fire in its incipient stage using a gaseous agent that causes no harm to electronics or documents.

CODE COMPLIANCE

Having the proper fire and life safety systems in your building and keeping them maintained is required by local codes and regulations.

You could be hit with hefty fines if you violate the local fire code. It is important that you have the required fire protection systems in place, and that you get your systems inspected regularly by a qualified fire protection provider.

W&M Fire Protection is a full-service fire protection company offering fire sprinkler, suppression, and alarm and detection system design, installation, inspections, testing, and service. Since 1993, W&M has been providing fire and life safety services to NYC buildings.

ACHIEVING YOUR GOALS

CONTINUED FROM PAGE 18

discuss progress.

Having an accountability partner can be a positive resource. Whether that person is a good friend, family member, or even a therapist, determining that person early on and enlisting her or his support can be very helpful.

Here are some additional tips for focus to help you on your journey: • Create realistic goals and, make them as specific as you can with an intended time frame. • Create a vision board and keep it somewhere you will see it. Seeing images and words important to you can be inspiring. • Connect with others who are working towards similar goals. You can provide each other with mutual support. • Keep motivation high by placing affirmations wherever you will see them most. It will help to keep you positive and hopeful

Achieving goals is hard work, but it can be done. If you are in need of support as you work towards your goals and would like to connect with other women who are also working towards their goals, reach out to learn more about the services that Vibrant Women Wellness Counseling (VWWC) offers.

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