The Ultimate Australian Guide to International Money Transfers
Transferring money overseas can be incredibly expensive. You also need to think about the safety of your money and how long the transfer will take. Because of this working out the best way to do it can be really confusing.
We want to make the process easier. These guides will take you through all of your options. We’ll explain all the fees, charges, exchange rates and discuss the company that might be best for you.
Popular Guides for Beginners
Transferring a large amount of money overseas
When it comes to money transfers, transferring larger amounts overseas is different.
If you are sending more than $20,000 internationally, it’s really important to choose the right way to transfer your money. Getting it wrong usually means you end up paying massive fees and charges.
Fees and charges: what to look for
While there are many fees you may be charged, these to are particularly important with bigger transfers
Sending money to family and friends
Using a bank
Using an Australian bank is the most common way to send money to another country. Unfortunately, it is also one of the most expensive methods to transfer money overseas.
Banks have different charges to send money abroad. The ‘Big 4’ charge between $22 and $32 to wire money from a branch and between $18 and $22 to do it online.
Online Money Transfer Specialists
Money Transfer specialists are companies that transfer money from your account to your family members account overseas. It’s similar to using a bank, except with much lower fees and better exchange rates.
You will have to register and account with them online. From there, the process very similar to using internet banking:
- Get a exchange rate quote to send your money overseas
- Enter the banking details of where you are sending the money. They are usually called the “Beneficiary” or “Recipient”
- Confirm the details and lock in the exchange rate
- Transfer the Australian dollars to the specialists (usually through BPAY or bank transfer)
No Bank Account? Cash Pick-up Options with Western Union or Moneygram
Not every family member is going to have a bank account. Western Union and Moneygram both offer a cash pick-up service. The advantage of this service is that your family member can access the cash very quickly on the other side of the globe, provided they have the right identification. The disadvantage is the cost. The fees and exchange rates for cash pick-up are considerably worse than a transfer to their bank account.
Sending Money to Family Overseas Using Paypal
Paypal is great for paying small amounts under $200 to family and friends. Unlike many other options, Paypal have a no-minimum payment size, allowing you to transfer any amount. Paypal may be a cheaper alternative to using the bank transfer because they charge a relatively small transfer fee.
Paypal is particularly fast if your family member has a Paypal account as well. If they don’t there is a set-up required and your relatives may wait up to 28 days for funds to arrive.
How to get a good exchange rate when sending money to family overseas
1. Research the live exchange rates.
Find out the wholesale exchange rate , it will give you a benchmark to compare the exchange rates between money transfer companies and banks.
2. Compare exchange rates online.
The tool below helps you compare exchange rates between banks and money transfer specialists. Save time and do it all under a minute.
Buying or selling property
Whether you have sold an investment house in the USA or a unit you bought while working in the UK, the whole process can be riddled with hidden costs. Once the property has settled and you need to get the foreign currency back to Australia, you have a few choices of how to do it.
Transferring money after a property sale is a big deal. Because of the size of your transfer, the small difference in exchange rate when you send the money can work out to be a huge difference in overall cost.
This guide will take you through the most common methods of getting the money back into Australia. It details the pros, costs, benefits and costs of each approach.
The 3 most common ways of transferring the proceeds of your property sale back to Australia
1. Get a cheque
Try to avoid this at any cost, unless you have a local bank account in the same country of the property. If you bring a bank cheque in a foreign currency back to Australia and convert it, it can be a nightmare.
Banks and only a handful of financial institutions will even provide the service of converting it back to Australian dollars. Those that do offer the service, often take weeks to convert it, will charge you a host of fees and usually provide an uncompetitive exchange rate because you are tied in with them.
2. Local help
This is by far the quickest, easiest and most convenient way to send the money back to Australia. Unfortunately, it can also be the most costly. You have no control over what exchange rate you receive from your bank and most of the time, you’ll only find out after the money has already been converted.
The exchange rate you receive is particularly important for large amounts so make sure you compare exchange rates before you transfer the funds.
3. Use a money transfer company
When you don’t have time to shop around for the best way to transfer you money back to your home country, using a money transfer company you trust to be reliable and affordable is a smart way to deal with international money transfers. Our currency conversion specialists at The Currency Shop have lots of information about the best way to deal with your international money transfers.
Related: What you need to know when transferring $100,000 overseas
Living and working abroad
Life as an expat is exciting but it also has unique challenges.
If you’re an expat sending money overseas, some basic knowledge helps you compare exchange rates and avoid some of the common problems.
Here are 5 common issues you may face – and some tips on how to overcome them.
1. Poor exchange rates
The rates listed as ‘official’ refer to the interbank rates and the fact is, this is not the rate you will be offered. This is why you can do better by shopping around. Comparing your options is the best way to get a good rate and avoid getting ripped off.
Beware of banks that charge flat fees for each transfer. If you send money overseas regularly, you may end up spending a small fortune in fees.
3. Lack of personalised service
When you choose a big financial institution to look after your foreign exchange conversion, you may find you get lost in the mix. Instead, consider looking for a local currency exchange expert and aim to create a positive, personal relationship. With some genuine customer service, you can have your questions answered to help you make the best currency conversion decisions that minimise your costs.
4. No access to hedging tools
This isn’t about gardening – just trimming costs. Hedging tools limit your exposure to the fluctuations in foreign currency that can add up to wasted dollars.
Reduce unwanted fees
Transferring money shouldn’t be a negative experience. With the right information at your fingertips and a professional currency conversion expert at your disposal, you can boost the potential benefits and minimise your risks. With the right foreign exchange specialist, it is possible to:
- Achieve a spread of 1% – and even lower.
- Reduce or remove fees.
- Create a strategy for purchasing currency.
- Access hedging tools. These types of contracts enable you to buy currency at a fixed rate for a set period of time – often 1 or 2 years. With your rate fixed, you will avoid the stress of market volatility and have a clear idea of what you will pay and how much you will receive in exchange, before each transaction is completed.
Which company is best for expats?
What we looked for included:
- The ability to make regular payments.
- Customer service that is dedicated and personalised.
- No (or very low) fees.
- Impressive exchange rates.
If you are an expat, look for a professional currency provider in your local area by asking some questions that matter to you. This will ensure you are happy with the answers provided.
Choose a provider that suits your needs and won’t cost you a fortune in either precious time or money.
Finding the right option
The Currency Shop offer free personalised advice via phone, email or even face-to-face if it all seems a bit overwhelming. Explore our website or give us a call on 1800 004 930.