Gibraltar: Spring Is In The Air: Time For A Financial Spring Clean?

Welcome to March. The cold days of deep mid-winter are behind us; although of course in these Mediterranean climes, "cold" is a relative term. And whilst we may have seen snow in unexpected places very near Gibraltar, I think it safe to say that we'll have to wait another year for a chance to use our toboggans on the slopes of the Rock. The days are noticeably lengthening and we can start to anticipate the long, warm summer ahead – even if it is not exactly right around the corner.

In common with our friends in colder climes, the urge to do a bit of "spring cleaning" generally makes its presence felt at this time every year. However I'm sure I'm not alone when I survey my ever increasing clutter (my "treasures" as I unwisely refer to them) and somehow find an excuse – any excuse – to defer action. And by then of course, summer is upon us and it's too late and the clear out must await another year. So how about considering some financial good housekeeping instead?

But where to start? We are reminded regularly that levels of personal debt across the world remain at dangerously high levels. The figures are staggering and, in some cases, indebtedness is even higher than before the onset of the financial crisis in 2008. Do not fear, dear reader, as one who is by nature a spender rather than a saver, I'm not going to pontificate about the urgent need to reduce your borrowing. In any case, I have always treated such advice with caution. After all, if it were that easy to reduce debt, everyone would surely do it.

Granted there are ways to reduce the costs of borrowing, but debt is debt; one cannot just make money appear out of thin air. There is one exception – my good friend and local magician Jamie Zammitt, who can indeed transform a five-pound note into a crisp twenty before one's very eyes. But with apologies to Jamie, the alchemy he performs might not cut it with your bank manager.

Leaving magic solutions where they belong, the first thing to consider in a financial spring clean would (I suggest) be to look at the simple stuff first. Few of us are able to follow Polonius' advice in Shakespeare's Hamlet, where he advises his son "neither a borrower nor a lender be". Therefore interest rates are indeed of interest to us all.

Most financial pundits consider that the next move in interest rates will be upwards. You may remember that they thought that in the UK – and therefore in Gibraltar too – last year too. Then 23rd June happened. Interest rates could in theory fall still further. A more likely scenario is that they do not, but that inflation rises markedly (albeit from a very low starting point). The prospect looms that negative "real" returns will become the norm, i.e. after inflation is taken into account. That is fine if you are borrowing but not at all attractive if you are a saver. The spring clean question is to consider your own "tolerance" for interest rate movements. The obvious concern for most is the effect on mortgage payments and, whilst individual situations will vary, we should all take heed.

Banks are keen to provide advice on mortgage deals and there are several options available. The spring clean might include considering whether your current deal remains the best option. There are pros and cons between fixed rates or some form of floating arrangement. One could simply relax, elect the simplest solution and take a chance with the market. By doing so, one might avoid the arrangement fees that come with the more bespoke alternatives – but you are likely to follow the Bank of England's monthly interest rate decisions rather more closely.

Another factor in our spring clean is to consider the impact of a volatile exchange rate. Here in Gibraltar we are particularly interested in sterling's performance against the euro. Most of us have some "currency exposure", as the City types would call it. This is true of any country bordering another using a different currency. The issue is more acute locally because the Gibraltar government is powerless when it comes to setting interest rates and is therefore at the mercy of the currency markets. To gain some idea of the financial impact of the latter, just consider than in the last 12 months the pound has yo-yoed between a low of just less than €1.10 and a high of just over €1.30.

This is unquestionably good news for exporters, right? By "exporters", I include all those in Gibraltar who sell things whether physical goods or services. It follows that goods or services we sell to foreign buyers will be cheaper in foreign currency terms today than a few months back. However, we don't produce much locally – with some notable exceptions such as my good friends at Gibraltar Crystal – and if the raw materials needed to produce the goods are themselves imported from abroad, those costs will have risen in sterling terms. So the net overall picture may not be as rosy as one might imagine. Again, every case will be different but the message is to consider the impact a fluctuating rate may continue to exert on your own finances or business.

For anyone with an investment portfolio, this might be a good time to reflect on the wider picture. Far more qualified commentators than your humble scribe are pretty much agreed that 2017 and beyond is packed with unknowns. Brexit and other uncertainties fizzle around the EU – the eye-wateringly high debt pile in Italy, continued problems in Greece, which is renegotiating its own debt (again), and elections in several countries, not least the Netherlands, France and Germany.

Another consideration is, of course, the new "free radical" that may – if you'll pardon the pun – Trump them all. And what reactions will he provoke in Brussels, Beijing and Moscow. Where does all this leave your investments? Talk to your adviser about the challenges out there. Danger may be lurking or there may be money to be made.

Pension holders are particularly affected by stock market performance. A review of your pension position is highly recommended. Again there is a seemingly bewildering choice available – especially for any people living in Gibraltar or just across the border in Spain that hold "legacy" pensions from the UK and elsewhere – not just in terms of investment options but in the type of pension you hold. There is a wide range of options out there and this is an area where professional advice is not only recommended (as it almost always is) but also, in some cases, required by law.

The message is that in these uncertain and potentially volatile times, nothing in the financial world is certain and we can take nothing for granted. All we do know is that summer is coming and by then I am sure we will all be far too pre-occupied with our preferred ways of enjoying the sun and the long languid days. The time for a spring clean is, well, spring. When we are done with the mops, brushes and bin bags – however half-hearted the effort – taking some time to dust off the financial clutter may be worth far more in the long run. I know I shall be doing so – at least it will assuage my guilt that my physical spring clean is, once again, unlikely to amount to very much. Now, where are those bank statements?

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.