3 Great Ways to Save Money on International Money Transfers
Category | Important Information
Published: 18/06/2018
| Updated: 20/04/2024
Savvy Brits don't find the cheapest international money
transfers by accident. They find them by design, as a result of earned
foresight and strategy.
This holds true no matter what market you're in, for even the smallest
purchase. Smart buyers always locate great deals deliberately. If you want
what they have -- a few thousand extra pounds each year – then follow the
precedent they set.
There are good and bad ways to perform any financial transaction. Keep
this in mind whenever you send money overseas. Consider every
international money transfer as an investment, even if they only involve a
few hundred pounds. All it takes is diligence and bit of planning. Here a
few rules to follow whenever you transfer money from the U.K. to foreign
countries.
Plan Ahead
Financial wisdom always includes strategy and planning. This includes
timing. Good timing can save you thousands on a foreign purchase,
especially if it's a large or recurring payment.
So get started early, weeks or even months before it's time to actually
move the funds. Planning ahead gives you options that aren't available for
last minute decisions. Careful planning also reduces the stress that can
lead to pressured and costly decisions.
Once you have the extra time, use it to your advantage. Do as much
research as possible. Always take fluctuations of exchange rate into
account. Even the most general knowledge can save you money. The pound had
a terrible summer against the U.S. dollar and the Euro. Knowing this
caused many wise Brits to delay or expedite a foreign purchase. A few
minutes a day with the financial section will make a huge difference.
Comparison shop
Once you've taken the temperature of the exchange market, it's time to
decide on which company to use. There are hundreds of online and in person
options, so decide on a set of criteria in advance. That way, you can
narrow your search to those firms with the best chance of satisfying your
specific needs.
Many people go directly to their bank when they need to transfer money
overseas, often to their disadvantage. Banks are safe and reliable, but
are not inclined to offer competitive fees or seek out the best exchange
rates.
Moreover, you can find the same security and protection at a specialized
firm that you would at your bank. Banks are perhaps best used for small,
one time transfers, when there simply isn't time to be more selective.
The key to saving money is understanding what factors are important to
your situation. Some companies offer low or zero fees, but make up for it
with a terrible exchange rate. Others offer fixed exchange rates to
attract frequent customers. The list goes on and on. The key is to shop
around.
Consider Using a Specialist Broker
Specialist brokers are companies that specialize in international money
transfers. They are experienced, reliable, and highly motivated to offer
customers the lowest fees. Importantly, they employ currency exchange
experts.
By combining expertise with a network of global resources, specialist
brokers can secure the best exchange rates possible, even under the
erratic market conditions. Investors noted this again and again over the
summer, as the pound continued to swoon relative to the Euro and the U.S.
dollar.
Many of these pleased investors benefited from their brokers' specialty
services. Specialist brokers offer a variety of ways to protect customers
from the whims of the exchange market. Some are designed to respond
quickly to vacillations in the exchange rate. These allow customers to
suspend or cancel transfers that are especially disadvantageous to them.
Another useful specialty service is The Forward Exchange Contract or FEC.
This is an agreement that locks in an attractive exchange rate for a
stated period of time. The locked in rate is good for up to two years and
protects investors from the constant flux of the exchange market. In
addition to saving investors large sums of money, an FEC also allows them
to earmark funds for other useful expenditures.
Conclusion
The work required to reduce the cost of sending money abroad is well worth
the effort. It's not especially difficult either. It just takes some multi
tasking. Saving money on an international money transfer is a balancing
act. There are always trade offs involved, as in any financial
transaction.
With planning and effective use of available resources, anyone wishing to
send money abroad from the U.K. can find reduced fees and good exchange
rates. And no real financial expertise is required, only a bit of time and
diligence.
