How to send money to the USA
Here's how to send a quick, affordable and secure money transfer to the United States from New Zealand.
While your local bank branch might be the most obvious option for sending money across borders, you can save on fees and take advantage of more competitive exchange rates with an online money transfer company.
In this guide, we’ll go through tips on how to get the best deal and what options you have.
Compare your options to transfer funds to the USA
The table below will help you compare different money transfer services so you can find the best deal for your needs.
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Step by step: How to transfer money to the United States
- Compare some services that can send your money to US dollars.
- Choose one and sign up for an account.
- Provide the details of your transfer, including the amount and who you want to send it to.
- Confirm and pay.
What’s the best way to send money to the US?
There are three main options that you can use, each with their own pros and cons.
The best way to send money to the United States depends on your situation. The main options include the following:
Money transfer services
These offer some of the most cost-effective transfers as they only trade in foreign currencies. You’ll also have a variety of options for your recipient to get the money, like to a mobile wallet or home delivery.
Services such as Western Union and MoneyGram allow you to send cash transfers for immediate pick-up by the recipient. While it’s a fast way to send money, it generally won’t match the rates or fees of dedicated money transfer services.
Beware of the higher fees and less competitive exchange rates banks offer compared to the other options.
Let’s crunch the numbers: Sending $2,000 to the US
To put this into perspective, let’s see what a transfer with each of these options looks like. This table uses real fees and exchange rates so is current as of 6 May 2019.
|Bank transfer||Cash transfer||Money transfer service|
|Fee||$24 + additional correspondent bank fees||$30||$3.99|
|Exchange rate||NZD$1 = USD$0.6723||NZD$1 = USD$0.6757||NZD$1 = USD$0.69457|
|Transfer speed||2–4 days||Minutes||1–3 days|
The bank option ends up being both slow and getting the least amount of money to your recipient. If you go with the specialist money transfer service, your recipient ends up with USD$58 more. However, if speed is what’s most important, the cash transfer can’t be beaten for instant transfers.
How long will it take to transfer money to the US?
It depends on what method you choose to go with, but the fastest one is instant and the slowest can take up to a week. Since banks need to transfer your money through several correspondent banks, it takes the longest. Cash transfers are the fastest and normally arrive in minutes.
Emergency cash transfer
If something happens and you need to transfer money to the US as fast as possible, cash transfers will be your best bet. This involves paying with a credit or debit card and transferring to a cash pick-up location. While it is fast, there’ll be more fees involved.
How to send money to the US without a bank account
Cash transfer services can also help you out if either you or your recipient is unbanked. If you don’t have a bank account, look for transfer services that have agent locations so you can go in and pay in cash. These cash transfer services will also have agent locations in other countries where your recipient can pick up the cash, without needing a bank account.
What to watch out for
If you’re sending a lot of money to the US, your recipient will need to declare it to the IRS. US citizens and residents will need to fill in Form 3520 if the transfer is one of the following:
- A gift worth USD$100,000 or more and it’s from a non-resident.
- A gift of USD$15,601 or more from a foreign corporation or partnership.
While foreign gifts generally aren’t subject to income tax, you still need to file the form with your taxes or face penalties.
Documentation you’ll need to send money to the US
- The recipient’s full name. Your recipient will need to show photo identification if they’re picking up the money, so make sure the name on the order is the same as the name on their ID.
- The sender’s full name. As an additional security measure, the agent may ask for the full name of the sender. Be sure that the recipient knows your complete name.
- Your recipient’s contact information and bank details. Both the sender and the recipient must have each other’s address and contact details.
- The tracking number. Keep the tracking number given to you upon sending the transfer as the recipient must provide this to the agent before the cash can be released.
It’s always best to keep all the paperwork to do with your transfer, just in case you need proof that the money was sent.
What to compare to get the best deal
- Exchange rates. Most services will add a margin to the exchange rate, but banks can often add the most. A small difference to the exchange rate can have a big impact when you transfer large amounts of money.
- Fees. Fees are either charged as a flat fee or a percentage, which means the more you send, the higher the fee will be. While some services offer fee-free transfers, this means they’ll add a bigger margin to the exchange rate.
- Payment options. Most, if not all, transfer companies will let you pay through your bank account, but if you can only pay with cash, you’ll have to look a bit harder.
- Delivery methods. This depends on your recipient – would they prefer it deposited in their bank account or mobile wallet? Or can they pick it up from an agent location?
- Customer service. Some services are only open during business hours, which can make it difficult when something goes wrong. Also, check out how you can contact them – do they only have a phone number? Or can you live-chat with them as well?
Foreign exchange rates explained
The exchange rate is how much one country’s currency is worth in another country’s currency. With the NZD/USD currency pairing, you’ll get more money when either the New Zealand dollar is strong or the US dollar is weak.
You’ll also see that the exchange rate you get quoted from money transfer companies differs. Compare what you get quoted with the mid-market rate below, which is what your money is actually worth.
Cash pick-up locations in the US
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