Thursday, 7 June 2012

International money transfer - How to save money

If you are planning to move overseas or want to send money offshore, international money transaction may give you a real headache, especially in times of emergency. The worst thing experienced by many is loss of thousands when they send money or receive the same from overseas. They lose because they have poor knowledge regarding exchange rate and transaction fees. However, this loss can be easily averted if you gather some knowledge in this regard and keep yourself updated with the latest happenings in the money transaction market. 

Is there any hidden fess?

Send Money Overseas
Send Money Overseas
There are two important instruments for money transfer – transfer fees and the margin levied on the exchange rate. Anxiety over exchange rate takes the better of the laymen and they are completely unaware of the fact that exchange rate is actually ‘hidden fee’ and this is the area in which the banks and other currency converting institutes make money.

What these transfer houses do is they sell currency at much above the interbank rate. This ‘plus’ is called margin and it determines the profit they make. Use currency converter so as to know the difference between the interbank rates and quote rate. It will help you assess whether you have made a good deal or not. 

Know how to take protection against currency volatility

Do you Send Money Overseas more than often? If it is so, then you may be a lot worried about frequent volatility in exchange rate. In order to protect yourself against currency volatility, you should go for ‘fixed rate’ arrangement. In that case, you need to pay 5-10 percent as deposit and the rest is paid throughout the valid time period (generally 12 months) when you actually make money transaction. 

Consider foreign exchange through bank and non-banking houses 

Generally, ordinary people prefer the banking hubs when it comes to international money transfer. If you are transferring money too often, then bank is a good option. But if millions of bucks are not involved in transaction and you are moving money far between, then you can contact any organizations dedicatedly doing currency transactions. These organizations are no substitute for banks but in reality, offer high-end service. These organizations have several experienced brokers who understand your needs, keep watch on the market exchange rate and finally determine the right time for money transaction on your behalf. 

Buy currency when the rate matches your ‘budget rate’

This works best for those who are not in a hurry to move currencies immediately. It is better to team up with a broker. Determine a rate that you want to achieve. However, your target must be realistic. When the market rate hits that figure, your broker will purchase the currency for you.

Do market research to get the best deal

There are several currency organizations operating in the market and all of them claim to offer the best service. It is better to check if there is any verity in their claims,. The best way to do this is to open an account with three or four organizations. It is a free process and puts no obligation on you to trade sooner or later. 

If you are shopping for a good rate, then engage a broker to do the job on your behalf. The exchange rate takes only a few days (2-3 days) to change, so make sure to be nimble at shopping!

So, follow the above-stated simple tips and save a tidy sum on your overseas money transaction!

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