Money hack: Save hundreds when sending money abroad
If you're planning to send money internationally any time soon, this hack is an easy win.
If you send money overseas from Australia your money is subject to foreign exchange rates, and more often than not, a foreign transaction fee as well. Worryingly, only one in five Australians (20%) understand that banks charge a transaction fee and a margin on the exchange rate when sending money internationally, according to research by online money transfer service TransferWise. And even worse, the research revealed that over a million Australians believe the banks send money overseas as a free service.
I hate to be the bearer of bad news, but using your bank to send money abroad is anything but a free service. On the surface, the costs might not seem like much, but they quickly add up. Digital money transfer service OrbitRemit recently analysed its Australian customer transactions for 2017 alone and compared it to traditional services (like the big banks) which can charge up to $30 per transaction. OrbitRemit found Aussies are spending in excess of $5.8 million in unnecessary fees, simply by sticking with a traditional service rather than opting for an online money transfer company.
The hack is simple: try to avoid using your bank when sending money abroad! Banks are notorious for charging costly foreign transfer fees as well as offering poor exchange rates, so the best way to save money when transferring money overseas is to simply avoid your bank.
Instead, opt for a dedicated online money transfer service which typically has low or no transfer fees and offers much more competitive exchange rates.
- You can compare your options here, including some international money transfer deals that are exclusive to finder.com.au to save you even more.
- Once you've chosen which service to go with, click through to their site where you can request a quote for your transfer.
- If you're happy with the quoted exchange rate and transfer fee, book the transfer.
- Continue this process each time you send money abroad, and you could save hundreds throughout the year.
finder money hacks is a bi-weekly roundup of the latest tips and tricks to improve your finances. Check back every Wednesday and Saturday for new hacks.