Sending money overseas might sound straightforward enough, but without proper planning and research, you could end up losing a lot to fees and poor exchange rates. Particularly if you are buying property abroad or regularly sending money overseas, the differences can become very significant. Don’t be tempted to simply go to your local branch or log into online banking to send a large sum of money, since you’ll invariably end up spending a lot more.
1 – Get a Favourable Exchange Rate
Exchange rates fluctuate all the time, and even a day or two could make a significant difference, particularly with larger transactions. It is important not to take the exchange rates quoted in Google, XE and other such services too seriously, since these typically reflect the best possible rates which, in practical terms, are usually unattainable for consumers. High-street banks rarely have very attractive exchange rates, so transferring large amounts of money by way of a direct transfer will often end up costing you a lot more than you need to pay.
2 – Find the Lowest Fees
Do not be tempted to automatically go for the option with the lowest fees, since you’ll probably end up getting a very bad exchange rate. Consider, for example, the currency exchange offices that you find in airports. They invariably advertise the fact that they don’t charge a commission, but the exchange rate tends to be so poor that you’ll actually end up spending much more. Most foreign exchange companies charge a set one-time fee for each transfer rather than a percentage but, to get the best deal, you’ll want to transfer higher amounts. If you plan to send money overseas on a regular basis, it may even be more suitable to go with a company that charges a monthly or annual set fee.
3 – Don’t Neglect Security
As with any banking activity, you’ll want to prioritize safety and security to ensure your money is in good hands. Always ensure that any international currency exchange service you use is fully licensed and regulated and that they are insured should something go wrong. Fortunately, it shouldn’t take long to find a reliable and trustworthy company given the wealth of information available online. Before making any commitment, be sure to read some reviews, and always familiarize yourself with the small print. If, for some reason, your money goes missing or takes a long time to get to its destination, you need to have guarantees that you’ll be adequately compensated.
The most suitable option for sending money overseas will depend entirely on your particular situation. If, on the other hand, you need to transfer a large amount of money, you’ll likely be better off using a foreign exchange broker and targeting a more favourable exchange rate. As always, be sure to compare the options online and get multiple quotes to find the most suitable option.