Sending money abroad is not exactly the same thing as sending it domestically, and if you’ve never had to send money internationally before, it’s important that you know some of the best tips for doing so safely and at the lowest possible cost.
The reason sending money internationally is not the same thing as sending it domestically is because there are more steps involve: you have to convert your money into the currency of the country your recipient is staying in and you have to pay additional fees, for examples.
Here Are Four Tips for Sending Money Abroad:
Tip #1: A Money Transfer Service Is A Better Choice Than A Bank
In almost all circumstances, using a third party transfer service such as Remitly will be a smarter option than using your bank.
There are two reasons for why this is so: it’s cheaper and faster. Bank wire transfers are notorious for being incredibly expensive. In addition ti paying a large flat fee, which can be fifty dollars or more, you’ll also have to contend with a high margin of the exchange rate (which could be up to five percent).
In contrast to this, money transfer services will usually charge you a small percentage fee and a smaller margin of the rate. You’ll still have to spend money to complete the transfer, but you’ll be spending less.
Furthermore, wire transfers are slow, and it’s not uncommon for transfers to take five days or more to complete. Contrast this with money transfer services, which can commonly have the transfer completed in a fraction of the time.
Tip #2: Research Your Service
The security of your funds should be of the utmost importance. That’s why regardless of which method you chose to follow for sending your funds overseas, you’ll want to pick a service that has a rock solid reputation so you know your money is in the right hands.
There are two things you can do to ensure that the transfer service you want to use is good to go. The first is to actually research the company, see what their reputation is, and find out if a larger company oversees them. The second thing to do will be to call their customer service team. If you are directed to a large call center instead of speaking with a professional representative, that’s not exactly the best sign.
Tip #3: Research The Lowest Fees
You’re going to have to pay transfer fees no matter what when sending money internationally. Nonetheless, different transfer services will have different fees for completing a transfer, and it’s up to you to research them.
As a general rule of thumb, you should expect to pay anywhere between a 1-5% fee on the transfer. 5% is definitely on the high end, so a fee of 3% or lower would be much more preferable (and not at all unreasonable).
Tip #4: Get A Guaranteed Exchange Rates
Arguably more important to pay attention to then the fees will be the exchange rates (the relative value between two currencies), which oftentimes can cost you even more than the fee itself. This is where transfer services really make their money: by charging you a small margin of the total rate.
The exchange rate differs by currency and by transfer rate and furthermore is always changing throughout the day as well.
To avoid paying a high margin on the rate, ask for a guaranteed exchange rate from the money transfer service you’re providing. If they only provide you with an estimated rate, and assuming you choose to proceed anyway, chances are pretty good that you pay end up more than you should be.
Finding a transfer service with the lowest exchange rates and then asking for a guaranteed low rate from them could ultimately be the number one best thing you do to save money on completing a transfer.
Sending Money Abroad
Sending money abroad is actually easier than it sounds. Sure, there are more steps to follow and more fines to pay, but the process is hardly intimidating and becomes very straightforward after you do it a few times.
Choosing a transfer service over a bank, researching the security of that transfer service, and then taking your time to find the lowest fees and best exchange rates are the top strategies you can use to send money internationally cheaply and securely.