If you need to transfer money overseas, whether it’s for buying or selling international investments, pension payments or just sending money to someone in another country, you’ll likely use an international money transfer. These kinds of transfers come with rules and fees, and this guide will guide you through the process, including getting the best deal on when transferring money abroad.
If you need to send some money overseas, there are two charges you need to consider. The first is the costs incurred in the exchange rate: i.e. how much your pound is worth in the currency of the country you’re sending it to, and the transfer fees, which is the charge applied by the company transferring the cash.
In some instances you can also expect to pay bank receiving fees, and while some companies attempt to get your business by claiming to be commission free, they often load the exchange rate to recoup their losses.
Exchange rates change continually, so getting a good deal can sometimes be a matter of timing, but there are steps you can take to make the most of your money. What you ought to be asking yourself is: what will I be getting back for my pound once al the charges are taken into account?
When transferring larger sums of money, say £250 and over, it might be worthwhile comparing your high street bank’s rates with some of the currency exchange specialists out there.
Exchange rates are affected by things like the amount of money you want to transfer, how quickly you need it transferred and the volatility of the currencies you are buying or selling. On the third point, this means you’d be wise not to leave your transfer until the last minute.
Keeping an eye on the exchange rate in advance of the transfer will allow you to make the exchange at the most opportune and profitable time, whereas if you leave it until the last minute you’ll be stuck with whatever rate is available at the time – you won’t have any choice.
So it’s important to look at the timing, the exchange rates and the charges – but how do you know if the company you’ve chosen to handle your money is reputable? As with any purchase, find out how long they have been in business.
Make sure that they are FSA regulated, as they will have to follow the strict guidelines set down by the Financial Services Authority. A reputable company will also be registered with HMRC as an overseas money services business.