Moved outside the United States? Here’s how to send more money back home.
Moving abroad can be complicated enough, but getting cash to your new overseas home or back to the U.S. doesn’t need to be stressful. Fortunately there are ways to find low fees and get better exchange rates. Compare your options and consider these expert tips before transferring money home or internationally.
Compare international transfer providers
Should I use a bank or an international money transfer company?
If you want to make an international money transfer, then you may want to consider avoiding banks. In many cases, you can only use banks for transfers when you have an account with them, and you will end up paying whatever rates and fees they demand, wait for however long it might take, and have fewer options for sending and receiving.
Dedicated currency transfer services have more choices, so you can compare options to find the best, then transfer money overseas with no or low fees, great rates and collection options that work for the recipient, whether it’s cash, check or a direct transfer to their bank account.
- International currency transfer providers make their profit by conducting a large volume of currency exchanges at small margins and small fees to cover costs. Their exchange rates are usually 1-2% less than mid-market rates, which means they make about that much on currency changed. Their income depends on offering great deals to attract a lot of users. To stay profitable they usually have minimum amounts that can be sent per transaction.
- Banks make their profit on overseas currency transfers from attaching fees to everything and offering currency exchanges at big margins (poor exchange rates). Their exchange rates are usually 2-4% less than mid-market rates, meaning they make about that much on currency changed plus all their fees. Their income depends on making as much money per transaction as possible. Because they have so many fees, banks usually do not have any minimum amounts per transaction, but smaller sums may be entirely lost to fees.
| Bank | Money transfer service |
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Bank fees are BIG
Bank fees mean you might spend hundreds of dollars on just one transaction. The fees might be more than the amount of money you are sending. Take a look at some of the fees you might incur depending on which bank you use:
- Fees for sending: They will typically charge you a flat $20-$30 fee.
- Fees for changing currency: Not only are the conversion rates worse, but they may charge another flat fee for converting the currency, which can be around $30.
- Fees for processing: If the money is being sent to a different banking institution they will charge additional processing fees, generally $10-$30 depending on the situation.
- Fees for receiving: The person you are sending money to will have to pay another fee to pick it up. This is typically more if they are in a different country and using a different currency, and can be over $30. They will also have to pay the separate fees of whichever bank they are using.
- Extra fees if you want to pay the receiving fees: If you, the sender, want to pay for the recipient’s bank fees, you can, but this incurs a “correspondent fee” of $40 or more.
- Fees for tracking the transfer: If you want to find out how much longer the transfer will take, or if it did not arrive and you want to find out what happened to it, then the bank will look into it if you pay another $25.
- Fees for amending the transfer: Need to change some details of the transfer? You can for another $25 fee.
- Cancelation fees: If you have realized the fees are too high and want to cancel the transfer, you can. But this will incur another $25 fee.
Currency transfer service fees are small
International money transfer services have small fees.
- No fees at all: Many providers will charge you zero fees.
- Set fees: Some providers require you to pay a flat $5-$15 in fees per transfer.
Any other fees?
If you need to make an emergency transfer that will arrive within minutes, this will incur a higher transfer fee.
How do I set up regular overseas payments?
Many transfer providers allow you to set up recurring money transfers, such as once a month. This is sometimes one of the first things people do when they move abroad and have found a new job. Many currency transfer providers let you do this online, over the phone or in person.
How to compare international money transfer services
Send more money overseas with currency transfer services and find the provider that’s right for your needs by comparing a few simple things.
Find a provider that works for you by making sure they accommodate your minimum transfer amount, required transfer speed and transfer method. After that, compare their rates and fees against the amount you are sending to find out which is the most cost-effective.
Finding the right money transfer company can be as simple as that.
| What to look for | What it is | With banks | With money transfer providers |
|---|---|---|---|
| Rates | Foreign currency exchange rates. This makes a big difference in larger transactions. | Poor rates, typically 2-4% less than mid-market value. | Good rates, typically only 1-2% less than mid-market value. |
| Fees | Flat costs you must pay when sending money. | Big fees for sending, receiving and exchanging money. | Typically a small fee for sending money, or no fee at all. |
| Minimum transfer amount | The smallest amount you can send in one go. | Usually no minimum, but sometimes fees can cost more than small transfers. | Varies widely. Can be nonexistent, a few dollars, a few hundred dollars or thousands. |
| Transfer speed | How long it takes to send and receive money. | From 2-5 business days | Typically 1 or 2 days, including weekends, sometimes within minutes. |
| Services available | How you can make transfers. | Online, over the phone or in person and more. | Usually online or over the phone, but in person with some providers. |
Jennifer’s money transfer plans
Jen had just moved to Australia with a new job lined up for her. Her new income was more than enough to pay her modest bills and living expenses, so she wanted to set up a regular transfer of money back home to America to pay for her father’s growing medical needs. Her plan was to transfer $1,000 every month, to be converted into U.S. dollars.
Jennifer’s first thought was to go to her bank. She looked at their options, then looked at their fees and realized it would take a big bite out of the money she sent. Searching for other options, she soon discovered an international money transfer service. To compare both side by side, she drew up this table.
Sending $1,000 AUD per month
| The bank | Money transfer provider | |
|---|---|---|
| Exchange Rates | $0.72 USD per $1 AUD | $0.76 USD per $1 AUD |
| Fees | $40 AUD per transaction | $10 AUD per transaction |
| How much money arrives back home each month | $680 USD | $750 USD |
When Jennifer saw that she would be able to send an extra $70 a month, her mind was made up. She decided to go with the money transfer provider.
How to make an international currency transfer
For seamless international money transfers, follow these steps.
- Know the details of the bank account you want to send money to. To transfer money to an account you must know the recipient’s SWIFT/BIC code, which indicates the country and location of the receiving bank, as well as the BSB and account number, which specify the individual bank account. You can find SWIFT/BIC codes online or by contacting the bank, and should get the BSB and account number from whomever you’re sending money to.
- Compare the international currency transfer options. They may have different exchange rates, different minimum transfer amounts and possibly some fees. To compare effectively, you should know the currencies to be converted, the amount you are sending and how quickly it needs to arrive. Rule out the options that are too slow, don’t exchange the currencies you need or have other problems, and then compare the remaining by price.
- Contact your chosen international money transfer service. You will generally need to open an account with them. Once you have set up your account, all you need to do is give them the SWIFT/BIC codes, BSB and account number of the recipient and they can transfer money efficiently and without and hassles. Their fees are usually minimal, and they will tell you if there are any additional costs.
- You can now send money overseas without losing huge chunks of it to bad exchange rates or sizable fees. Do it online or over the phone, set up automatic transfers and make use of any discounts available. You’re now good to go!
Frequently asked questions about expat money transfers
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