finder.com.au Money Podcast #39: Money transfer traps
This week on the show we welcome Nicholas Lembo from TransferWise to talk to us about international money transfers and tips for taking money overseas. Nicholas is the Head of Communications for APAC at TransferWise and has a huge amount of experience and knowledge about the best ways to send money overseas. Some of the topics we chatted about included:
- Why money transfers are so difficult with traditional banks
- What fake exchange rates are and how to avoid them
- Why you need to be careful using an Australian credit or debit card overseas
- The biggest tip for those working overseas and receiving payments from clients or companies in different countries
Also on the podcast Liz, Adam and Marc talk about the small business surcharge ban, petrol prices, Burger King's new cryptocurrency and surnames which are more likely to be rich and successful.
Listen or download the episode below
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Notes and links mentioned in the podcast
- House in Brunswick West sells for $1.16 million after being bought in 1975 for $6,000
- Small business credit card surcharge ban comes into effect
- Petrol prices are the lowest they've been since 2002 but margins are the highest
- Man is fined $124,000 after forcing Hawaiian Airlines to turn back mid-flight
- These elite surnames will make you more likely to be rich and successful
- Burger King in Russia launches new 'Whopper Coins' crypto currency
- Extremefomo.com lets you figure out how much money you would've made or lost in the stock market had you chosen to invest at certain times
- TransferWise
- Nicholas Lembo
- TransferWise Borderless Account
- Our review of TransferWise
Read the transcript of this episode
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Announcer: Welcome to the Money Podcast, from finder.com.au, Australia's most visited comparison site. The Finder Money Podcast is your weekly dose of finance and consumer news, tips, and tricks without the boredom.
Marc: Greetings and salutations, financial journeyers. You're here at the finder.com.au Money Podcast with your hosts Adam "Smitty" Smith.
Adam: Hey, everybody.
Marc: Liz "Smitty" Barry.
Liz: Oh, thank you.
Adam: Damn you, Terrano.
Marc: No, Liz "The Financial Panther" Barry.
Liz: I'll take either one.
Marc: And myself, Marc Terrano. How are we all today?
Liz: Feeling good.
Adam: Feeling pretty good. Pretty, pretty, pretty good.
Marc: Yeah?
Adam: Yeah.
Marc: Are you guys in a prosperous mood?
Adam: Yes, actually. I'll tell you guys. I'll tell you what I did the other day on a wild...kind of a wild whim. I went into the Old Bank, had a talk with, you know, the bank manager.
Marc: Had a good old sit-down?
Liz: The actual manager.
Adam: Yeah, he took off his top hat and he sat down, and I went ahead and I applied for myself for a home loan.
Marc: Wow, exciting. Very exciting.
Adam: So, still waiting, still waiting to get the old preapproval, see what happens. You know, they could be like, "No, screw you." But we'll see.
Liz: [crosstalk].
Adam: Yeah, I'll keep you guys posted.
Marc: Very interested to hear your journey.
Adam: Yeah, yeah. Already I feel like I'm learning things that I didn't know even after like six years of writing about nothing but home loans. After one, like, hour-long meeting with the bank guy, I'm like, "Oh, I didn't know that."
Marc: Yeah, it's interesting, right? You don't realize...until you actually take the step, you don't realize how things actually work, and these are all the things you will need. And, yeah, it's interesting.
Liz: [inaudible 00:02:04] the grimy underbelly of the back system, basically.
Adam: Yeah, that's right. Yeah.
Marc: Wow, interesting.
Adam: And I'll bring the news back to you.
Liz: Yeah, please do. I wanna hear about the disgusting back world of home loans.
Adam: That's right. And can I just say how invaluable our website has been thus far.
Marc: You've found it useful. I mean...
Adam: Yeah, found it very useful, yeah.
Marc: You wrote it, so...
Adam: Yeah. But researching, comparing, calculating. I've done all of the above. And, yeah, it's been invaluable. So, look, it's not just...you know, we're not just a pretty face.
Liz: Although we are all quite pretty.
Adam: Yeah, that's true.
Marc: Yes, yes. How was it about you, Liz?
Adam: I was actually told not to wear a hat today so as not to hide my beautiful face.
Marc: That's right. I'm glad you didn't.
Adam: You're welcome, everyone.
Marc: Adam is looking suggestively to the cameras.
Liz: Which are here, by the way.
Adam: Yeah, that's right. We've got cameras in the room once again to try and record for posterity.
Marc: Yeah. Because it's not enough just to hear a voice.
Liz: Apparently.
Adam: People wanna put a face to the name, don't they?
Marc: Yes, that's right.
Adam: Beautiful, beautiful face.
Marc: Yes. So today, Liz, we've got a special guest coming in.
Liz: We do.
Marc: Do you wanna tell our lovely viewers and listeners who we've got in?
Liz: So today we have Nick from TransferWise coming in. So we're very excited to kind of talk about all things money transfers. Yeah, so we have a bunch of questions, because this is not my area of expertise, so...and I don't think it's either of your areas either.
Adam: No, no.
Marc: Sadly no. I did use TransferWise the last time I sent money overseas.
Liz: Oh, okay. So you still do grimy underbelly [inaudible 00:03:54] system?
Marc: It was so easy. Yeah, it was very... What's the opposite of grimy? Spotless?
Adam: Spotless.
Liz: Smooth.
Marc: It was very smooth. Yeah.
Adam: Gleaming.
Marc: I was possibly gleaming, yeah.
Adam: And I'll tell you, I've had to send money overseas a few times because, you know, I'm from America, and it can be a grimy process, it can be very grimy.
Marc: I can imagine, yeah.
Liz: Well, something interesting that they're doing is actually revealing the grimy process that's actually put in place by banks and how they're trying to hide fees, the actual real fees they're being charged. So I'm keen to kind of chat to him about that.
Marc: Me too, yeah. They're really sticking it to the man with their campaigns.
Liz: Sticking it to the man.
Adam: Well, they are the man, they are the man. They're sticking it to the little guy. They're the man sticking it to us.
Marc: Yeah, exactly. Yeah. Great. So shall we delve into a little bit of news?
Liz: Let's do it.
Adam: Okay. So I actually came across this house in Brunswick West in Melbourne.
Liz: Did you buy it?
Adam: I did not. I did not. I wish I had. But it sold for 1.16 million. Which, you know, pretty par for the course these days.
Liz: Yeah, I wish I was shocked by that.
Marc: Yeah, exactly.
Liz: I was like, "Yes, go on."
Marc: Yeah, no surprise.
Adam: That's not the shocking part. Take a guess at what the seller paid for it.
Marc: Sorry, reconfirm the recent purchase price.
Adam: 1.16 is what...
Marc: Okay, 1.16?
Adam: ...it sold for. Now, what do you think the seller paid for this house?
Liz: Four hundred thousand.
Marc: Ten grand, going with Adam's low ball...
Adam: Marc, you're closer.
Liz: Oh, what?
Marc: What?
Adam: Six thousand dollars.
Liz: Oh my goodness.
Adam: Six thousand dollars in 1975.
Marc: In '75?
Adam: They've held on to this house all this time, and they've made a tidy profit, one would say, 1.16 million. So yeah, pretty...
Marc: Jeez.
Adam: Pretty decent little investment there, huh?
Liz: Yeah!
Marc: That is quite the nice little nest egg.
Adam: Yeah. I don't know these people but I hate them.
Liz: Automatically.
Adam: Yeah. And it's not renovated or anything. Apparently, the buyer decided... Yeah, I think that they're actually just gonna knock the place down, it sounds like.
Marc: That's sad.
Liz: That poor person who held onto it and the first buyer is just gonna completely knock it down.
Adam: Yeah, yeah, they are. They said that it's slated for demolition because they decided renovating it was just a bit too much work. I mean, it looks like it probably hasn't changed since it was first bought in 1975 if you look at the decor. Even the furniture looks like it hasn't changed.
Marc: That's amazing. And I suppose in 1975, like, prices obviously sound like they were very cheap, you know, six grand sounds like nothing, but relative to incomes, it probably wasn't that cheap, but it still was cheaper than what...
Adam: Oh, it's still considerably cheaper. It still would have been less than the annual yearly salary.
Marc: That's crazy.
Adam: Yeah.
Marc: But just that...didn't that not as many people wanted to buy properties?
Adam: Maybe it was people didn't wanna buy in that suburb back then.
Marc: Right. Yeah, because that makes sense.
Liz: Yeah, because I don't know Melbourne that well but maybe it was a bit further out.
Marc: It could be.
Liz: Or the transport wasn't as built up, or...
Adam: Well, Brunswick West is kind of an inner city suburb, but it could be that it was a dodgy suburb back then.
Liz: Well, that's the thing, if you look at attitudes and how much they've changed. I mean, if you go back, you know, 20, 30 years people didn't wanna live in the inner city.
Marc: That's right.
Liz: People wanted to live slightly further out. It was actually thought of as quite nice to have a house in the sort of outer suburbs.
Marc: That's right. Some people even thought, you know, living by the water wasn't really that nice. I know my grandparents when they came to Australia they were like, "Why would you wanna live near the water? It smells."
Liz: Maybe that was just your grandparents.
Marc: How wrong they were. Sorry, go on, Liz.
Liz: And some big news today. A new ban has come into effect from the ACCC. So all businesses can no longer charge excessive surcharges for card...for accepting card payments. So the ban actually came into effect for larger businesses last September, but now all businesses can no longer charge excessive surcharges.
Adam: What's considered excessive?
Liz: So whatever you...whatever the business...the cost incurred by the business for accepting those card payments, they cannot charge over that to the customer.
Adam: Ah, interesting.
Marc: Yeah, very interesting. Today's D-Day.
Liz: Well, it's strange that, you know, businesses thought they could charge over that. They were just charging whatever they... I'm just quite surprised that it was acceptable to kind of go over and above that.
Adam: How do I know if a business is charging excessive surcharge? Because I don't know what it costs them, how can I as a consumer identify that? Because, see, I go to a cafe, and if it's...you use your card on something under $10, it's 30 cents, which doesn't sound that bad to me. It might cost them 30 cents to process that. I don't know. But then you walk down the street to the excellent price store, one of those kind of junk dollar stores and it's like a 50-cent surcharge. So does it actually cost them 50 cents and it costs the cafe 30 cents because they're using different systems? Are they both overcharging me? I don't know.
Liz: Yeah. So everything is gonna be expressed as a percentage now. So you won't be charged a flat fee any longer.
Marc: What I saw relates to petrol. Petrol is at its lowest price since 2002.
Adam: That's pretty good. I only notice them if they're really low. Like, that's the only time I actually pay attention is if I drive past a petrol station I'm like, "Oh, that's a good deal."
Marc: Interesting.
Adam: I never notice if I'm like just paying a crap-load for petrol. Like it doesn't...it just doesn't register with me.
Marc: I actually wouldn't even be able to tell you what petrol prices are right now.
Liz: See, I don't...because I never check, I just have no...I just pull into petrol stations that I normally go to. Isn't that bad?
Marc: We need to up our game, Liz. That's part of a road test, I think.
Liz: Yeah, I think so as well. Like, know what petrol prices are first of all.
Marc: Yeah.
Adam: When I lived in the States, I was...I got this trait from my father, but when I lived in the States I was very, like, determined to get a good deal on petrol and almost ran out of petrol more than a few times. Like, "Nope. Not gonna pay that." Like I know if I keep going about 10 more miles, there's a place that has cheap petrol. So, yeah.
Marc: And then Adam also had a Flintstone conversion to the cartoon case.
Adam: That's right. I think what's made it difficult is moving over here and like, you know, it's in...the cost is per liter rather than per gallon. It's like I have no idea. I have no idea, like, if this is a good deal, a bad deal. Don't know. I know it's a terrible deal compared to the States because, you know, obviously a liter...like a gallon is like three liters or something. So there are times where you check petrol prices in the States and we're paying like two or three times what they are.
Marc: Jeez.
Liz: In the states, do they do your petrol for you? Like, do you pull up and...
Adam: No, not most places except New Jersey, where it is illegal to pump your own petrol.
Liz: Really?
Adam: Illegal.
Marc: What?
Adam: That's right.
Liz: That's interesting.
Adam: Most likely because of unions and the mafia.
Marc: That is so crazy.
Adam: Because I'm sure that there's a union somewhere of, you know, petrol station attendants that have lobbied to continue to make this illegal. You can drive right across the border to any other state and pump your own petrol, but if you're in New Jersey, you can't do it.
Marc: Those big petrol attendant.
Adam: Yeah. When I was a kid, they always did. Like everywhere they pumped the petrol for you and then you had to tip them, you know. But yeah. And they cleaned the windscreen and all that stuff.
Liz: So that'd be great. I would tip someone for that. I can't be bothered.
Marc: It sounds like it would be nice for the first couple times, and then I think you'd become like Adam and you'd kind of just be like, "No."
Adam: Yeah, you'd just be like, "I'd really rather just do this myself." So I don't have to interact with someone.
Liz: You'd pull up to the petrol station to get a pack of chips and they'd start, you know, pumping petrol and washing your windscreen.
Adam: They're like gearing up your tires, rotating them and stuff.
Liz: Yeah, you're like, "No, I just wanted a coke."
Marc: I just wanted a can of Pringles. Well, I'm feeling suitably informed, are you? Are y'all?
Liz: Oh, nice little American touch there.
Adam: I'm doing all right.
Marc: Let's get a bit of funny money in the house, shall we?
Liz: Let's do it.
Marc: Have any of you ever wondered how much it costs when a plane has to turn around due to, you know, unruly behavior or someone doing something crazy?
Adam: It's never crossed my mind, but now I do.
Marc: Okay. So I've always wondered this because you keep hearing stories about like someone doing something or, you know, getting aggressive and the plane has to land. You know, it has to do an emergency landing so that the police can escort the person off the plane. So one man on a flight, he was flying back home. He was flying from Hawaii to New York. He got aggressive. He was drinking, yelling, and then he actually hit a flight attendant and he was threatening violence. Anyways, so the plane had to turn back to Honolulu and he got fined $124,000 for this.
Adam: Wow!
Marc: Yeah. And that's not even the full cost that the airline...that Hawaiian Airlines had to pay. They actually were still out of pocket 60 grand because they had to give meal coupons and stuff to everyone that got delayed.
Liz: Oh my gosh.
Marc: Yeah. So if you're ever thinking about doing something on a plane, don't.
Adam: Or just do it on a much shorter flight than that.
Marc: Yes.
Liz: Sixty thousand dollars in meal...? Well, I guess you think about the amount of people on the plane.
Adam: Yeah, a couple hundred people, at least.
Marc: Times three meals or four. Like six. Depending on how many days.
Liz: That's not even that long a flight, is it? Hawaii to New York. It's only across the country.
Adam: That's a very long flight.
Liz: Is it?
Adam: It's along the...
Marc: [inaudible 00:14:43].
Adam: LA to Hawaii, it's like five or six hours.
Marc: So maybe like...is it over 10?
Adam: Yeah. Yeah, it's a very long fight.
Marc: Yeah, okay, so it's kind of like a long-haul. Yeah, because the U.S. has pretty strict rules with interfering with flight crew members and attendants, so.
Liz: And punching people.
Marc: And just generally punching people. Yeah, so the maximum penalty is actually 20 years in prison, yeah.
Liz: Oh my gosh.
Marc: And fines of up to $316,000. So this guy got off lightly, but...
Adam: Yeah. Well, it's a federal...because airlines are federally-regulated, if you do something on an airplane, it's a federal crime.
Marc: Right, yeah.
Liz: And they have those air marshals.
Adam: They could pop up at any moment to tase you.
Marc: Oh, air marshals. "Tase you."
Liz: I wonder if we have those in Australia? Like just secret agents that just fly everywhere...
Adam: Fly around.
Marc: Yeah.
Liz: ...and just wait for someone to do something.
Marc: It's like that movie "Bridesmaids."
Adam: Yeah, exactly.
Marc: You're a marshal, right?
Liz: Yeah, I think everyone was thinking about that. Okay. So there was some research done by two universities, the Melbourne University and the University of California, and they found that if you have one of these elite surnames, you're more likely to be rich and successful. That's right. So basically there were some examples used in the article. So in Australia, if you had one of these...there were 500 names basically, but they didn't list the names in the article. But some of the names I found quite interesting because I don't know anyone who would have one of these names. So one of them was A. Beckett.
Marc: Hmm, A. Beckett.
Liz: Brissenden.
Marc: This is a surname?
Liz: Yeah.
Marc: Brissenden.
Liz: Brissenden. Clubb, with two Bs.
Adam: Ooh.
Marc: That sounds elite.
Liz: Clubb.
Adam: Clubb.
Liz: Westacott.
Adam: That does sound very rich.
Marc: Yeah, that sounds.
Liz: Yeah. And Zwar.
Marc: Ooh!
Adam: Zwar?
Liz: Zwar.
Adam: Interesting.
Liz: But I found it quite funny because they also listed some ordinary folk who are less likely to have...to be at the other end of the social scale, and one of them the last name was Smith.
Adam: Oh, man. It's Smithington. Maybe I'll change my last name to Moneyhavington.
Liz: Ooh, yeah.
Marc: Adam Clubb. I'm gonna change my name to that first.
Adam: You'll change it to Adam Clubb? That's interesting.
Marc: Marc Adam Clubb.
Liz: But yeah. So they actually found that those with elite surnames are 76% more likely to hold a degree from the nation's top universities.
Marc: Wow.
Adam: Interesting.
Marc: I wonder what, like, if you did that same analysis but with wealth, what would the... Well, I suppose we know the richest people in Australia, but... Nah, anyways.
Adam: Yeah, they're fairly likely to be named Murdoch or Rinehart.
Marc: Exactly, yeah.
Liz: Marc Murdoch.
Marc: Marc Adam Clubb Murdoch.
Adam: That doesn't mean if you change your name to that you just automatically have money.
Liz: Oh, damn. That was my plan.
Adam: Okay. So, you know, if you do have money, though, you're looking for a place to invest, we've chatted a lot about cryptocurrency as an investment asset. We've even talked about starting our own, the Foin, but, look, maybe we're not crazy because it's been launched by Burger King in Russia, right?
Marc: Whoa.
Liz: In Russia?
Adam: Yeah, in Russia. So, of course, you know, Burger King, kind of the complimentary fast food place to our Hungry Jack's. So they've launched their own crypto currency called WhopperCoins, right? It's hosted on the Waves blockchain platform. Customers will get one WhopperCoin for every ruble that they spend, right? So just in point of reference, like 59 rubles is 1 American dollar.
Marc: Oh, okay, wow. So a Whopper would cost...you'd get a few coins.
Adam: Yeah, you're talking in the hundreds, yeah. And they're talking about launching an app as...to kind of store and manage your WhopperCoin. And their head of external communications in Russia said, "Eating whoppers now is a strategy for financial prosperity tomorrow."
Liz: These are just becoming marketing strategies now.
Marc: Yeah.
Adam: Oh, yeah. No, it's definitely a marketing gimmick, but it's a really awesome marketing gimmick.
Liz: Oh, yeah, it's quite good. Well, why else would we be talking about Russian...
Adam: Burger King.
Liz: ...whoppers?
Adam: Yeah. Yeah.
Marc: It's funny because if you think about it, loyalty cards and things like that, they haven't really progressed past the whole, like, card with a punch hole.
Adam: Just a punch card, yeah.
Marc: Yeah, since they were invented.
Adam: Yeah. But this is basically...it's a loyalty card.
Marc: I think we're gonna...like with my completely, you know, zero knowledge of cryptocurrencies and things like that, I think we're gonna probably see more of this sort of loyalty card stuff, loyalty rewards using points.
Adam: It's super-smart, isn't it? It's really smart. I've actually got another one.
Liz: Oh, another double week.
Marc: But wait, there's more!
Adam: There is more.
Liz: Can you stop showing yourself?
Marc: Yeah, Adam.
Adam: What can I say? It ain't my first rodeo, kids. So you know how oftentimes we talk about, "Boy, I wish we'd thought to do that, you know..."
Marc: Every day.
Adam: "...back in the day?" Like, "I wish we'd thought to buy that stock or thought to invest in this."
Liz: Start Uber, yep.
Adam: Yeah. Well, now there is a way that you can quantify your own lost opportunities.
Liz: Why? Why would someone do that? That's awful.
Adam: It's a website called extremefomo.com.
Marc: Wow.
Adam: And it's an online calculator that lets you figure out how much money you would have made or lost in the stock market had you chosen to invest in certain stocks at certain times, okay? So for instance, if you had invested $1,000 in Tesla in June 2010, it would have made you $16,867.37. These are American dollars, mind you. If you invested in Apple, $1,000, on January 1st, 2002, you would have made $6,260.77. Same deal with Google, $1,000 in August 2004 would have earned you about $8,200, whereas Twitter, if you invested in Twitter when it went public, if you put $1,000 in, you would have lost $631.71.
Marc: Wow.
Liz: If I find the losses, I think I would kind of feel better about myself.
Adam: Feel a bit better. Yeah. Well, for instance, Yelp, if you'd invested in Yelp in 2012, you would have made $921.40, but if you'd waited until January 2014, you would have lost $384.87.
Marc: Interesting.
Adam: Same deal with Apple. If you invested in 2002, you'd make $6,000, but if you wait until 2014, you would have lost $711.
Liz: Hmm, interesting.
Adam: So there you go. Now, if you want to kick yourself for missed opportunities, you can actually attach a dollar value to it.
Liz: Great.
Marc: That's incredible that someone has made that. But it makes sense. Yeah, it makes sense.
Liz: Yeah, I really wanna kick myself now. Do it properly.
Adam: There's actually also an app, What If Bitcoin app, that lets you see...
Liz: No, I don't wanna know this.
Adam: ...if you'd invested in Bitcoin. I guess my question is, where is the What If WhopperCoin app? We need to get in on the ground floor of this right now, guys. We need to get as many Russian WhopperCoins as we possibly can, because this is probably going to be the currency that we all...it's gonna be the currency of the future. What the global market operates on.
Marc: Can you imagine if in 30 years time we're just sitting in like a hut in, you know, the ruins of civilization and we're like, "Damn, we need more WhopperCoins"?
Adam: Yeah, exactly. Like, "This is the only currency that...like, that everyone agrees on that still has value. You know, every other nation's fiat currency has collapsed, people won't even trade commodities or broader goods and services. The one thing everyone can agree on has value is WhopperCoin."
Marc: Wow, jeez.
Liz: It's logical. I mean...
Marc: Sounds probable.
Adam: Yeah. You get enough of them and that's a burger right there. We're assuming that in the...after the Apocalypse, the one thing that will have survived is Burger King.
Marc: Yeah, the one piece of infrastructure. All that lead paint. Okay. So shall we get Nick from TransferWise in to chat all things money transfers?
Liz: Let's do it. So in the studio, the recording studio, we have Nick Lembo from TransferWise. Welcome.
Nick: Thanks. Good to be here.
Liz: So I'm really excited because this is an area that I really don't know too much about. So we have a thousand questions, and I'm sure Marc and Adam do as well. So I thought we'd start off you just telling us a bit about TransferWise, how the platform works, and yeah, a bit about international payments.
Nick: Sure. So TransferWise is a new kind of financial services company. We started in 2011. Our core product is a international money transfer platform. We've recently added something called Borderless accounts, which are essentially virtual multicurrency accounts as well. And what we're trying to do is just make financial services and money transfer more fair, more transparent, and easier for everyone.
Liz: Are you saying it's difficult or something?
Nick: It's hard and expensive.
Adam: Oh my goodness, is it? It seriously is. Trying to send money or receive money, in my case from the U.S., it's always been just such an absolute nightmare and very, very expensive.
Marc: Yeah, I actually used TransferWise a couple of months ago, I think...
Nick: Awesome.
Marc: ...and it was really easy.
Nick: Was it a good experience? Okay, good.
Marc: We were talking about it before. It was a very spotless experience. It was just...yeah, it was easy to use.
Nick: Yeah, well, I was actually...oh, I'm sorry. I was actually a customer for like a year and half before I joined the company as well. So I'm from the U.S., obviously, originally, as you can probably tell, and, yeah, I...you know, if you know anything about American education system, you know most people come out of university with student loans, so I was living here and paying off my student loans using TransferWise.
Marc: Well, something that is really been on mind when it comes to transfers, money transfers, is why is it so expensive and just so...such a bad experience when you use like a traditional bank or...
Adam: Yeah. Like, are these people just taking us for a ride, basically?
Nick: Yes is the short answer. I mean, we see it in lots of countries around the world where we operate, and the sad truth is that banks have a monopoly, traditionally, on international money transfer. Lots of things, but specifically international money transfer. And most people don't really understand or aren't aware of how much they're getting ripped off until they go through the experience, they have that realization. And so because they've had this kind of monopoly on this, there hasn't been a lot of consumer pressure or competition, or pressure from government or anything like that to regulate it or set standards or guidelines. So they've kind of just been allowed to charge what they want and get away with what they want. And that's part of our mission, right? Is to make things more transparent so that people have a choice and bring more competition to that kind of sector.
Adam: Well, that's an interesting point you bring up, that, you know, people aren't aware. For me, sending or receiving money to or from the States, I always have a very strong kind of conviction that someone is taking advantage of me, but I have no point of reference by which to prove this. So given, you know, the bar that I'm kind of looking at, the benchmark I'm looking at is just a horrible, horrible experience that costs lots of money, what should I be expecting when I go to transfer money or receive money overseas? Like, what's kind of the standard that you think we should be able to expect?
Nick: Well, I can tell you what banks do today and I can tell you what we offer, and you guys can kind of...I mean, I think, obviously, most people, when they go transfer money through a bank, they're being told that their transfer cost and upfront amount. So I bank with Commonwealth, an international money transfer through Commonwealth costs $22, but in reality it costs a lot more than $22 because if the U.S. dollar today is 79 cents or whatever it would have landed on, I go to Commonwealth and I set up that transfer and I'll get 74 cents.
Adam: I know, God.
Nick: So the fee that they're charging you is actually hidden in the exchange rate margin and the markup, which most people don't really understand that, or comprehend it, or they don't do it enough to see it as a massive problem. What we're trying to do is basically make sure that when you come to TransferWise, you get the real exchange rate, you get the exchange rate you see on Google, or on Reuters, or on XE, or on whatever service you use. The fee that we charge you is a very transparent upfront amount. It's 0.7% of your total amount, and that's it. And so we like to think that by making the exchange rate clear, taking a small fee that's very transparent and right there in the user experience and the user flow as you go through, the amount that lands in the other account is really clear, and we think that making the process that simple and clear, and hopefully intuitive, but also cheap and fast is the best outcome you're gonna have.
Adam: That sounds glorious.
Liz: Is this kind of a problem that's been happening all over? Is this, you know, a global problem that kind of banks are not charging the real exchange rate or is it just Australia? Just terrible Australian banks.
Nick: So we actually did a study on this not that long ago. The first answer is yes, it's everywhere, but the second answer, which most Australians are probably used to, is yeah, it's kind of everywhere, but it's also a little bit worse and more expensive here than it is in most places, right?
Liz: Oh, good.
Nick: That's not necessarily unusual for paying for goods or services in Australia, right? So we found, when we did our study, that the average kind of markup in the exchange rate that the big four banks charge here is anywhere between like 5% and 6%. In most other countries, they are taking a margin as well, but it's not typically that high. The study that we did also found that if you total that up and aggregate and you looked at exchange rate markups and card charges as well overseas, so if you use your Aussie card when you're traveling, put those things together in 2016 and it cost Australian consumers $3.1 billion.
Liz: Oh my gosh.
Adam: Wow.
Marc: Yikes.
Nick: So that's a lot of money to a bank's and a broker's bottom line.
Liz: Yeah, I don't have that kind of money. I don't know about you guys.
Adam: That's unfortunate because you actually owe that amount, so.
Liz: Damn.
Marc: But I think you touched on something that is really important, which is when you go overseas using your Aussie cards, you have to be so careful because you just get stung every time. Maybe you could help explain to listeners who maybe don't know about that why you need to be aware of that when you go overseas?
Nick: Yeah, it's a massive thing, right? Like, you go and you log on your app or whatever website you use and you're like, "Oh, yeah, use my card. Well, my exchange rate was bad, but it also cost a percentage of the total of whatever item or service I bought." So it is one of those things that you need to be really careful about when you go overseas. Almost every bank or a credit card company does them. Some are better than others. If they are better, you usually pay the annual fee, right? But for the most part, avoiding use of Australian card overseas is generally like a fantastic rule of thumb. There's lots of ways around that, whether it's a prepaid travel card or sending money to a family or a friend over there who can take money out of a local account and kind of ways to work around it, but, yeah, it's kind of... Two rules I always give to people who find out that I work at TransferWise are don't change money at the airport and don't use your card overseas.
Adam: Guilty.
Marc: Yeah.
Adam: Guilty on both counts.
Liz: Oh dear.
Adam: I just do everything wrong.
Marc: When is the best time to change money? Like, should you change it before you leave or you're gonna get sort of stung then as well, or should you just change it, you know, in the suburbs when you land somewhere far from the airport?
Nick: I think, you know, exchange rates do fluctuate all the time, right? So as long as you can avoid an airport change bureau, you're gonna be better off as long you don't do that. I mean, I personally, when I travel, I'll have a prepaid card and I'll kind of start thinking about it a couple of weeks before I'm going on a trip and...
Liz: More and more people are using international payments, I mean, why is that? Are more people...is it just travel or more people are, you know, like Adam and living overseas? I mean, what's happening? What's going on?
Nick: It's a really good question, right? I think part of it is definitely just the fact that more people are living overseas now than ever before for a variety of reasons. So two of us in the room are examples of that. And even I think as part of the research we did that I mentioned before, we found here's a million-plus Australian adults living overseas as well.
Liz: Wow. That's about 25th of the country.
Marc: Yeah, that's massive.
Nick: Massive amount, right? For whether it's for work, or study, or travel, whatever it might be, I think that's definitely a big part of it, is that there's more people living overseas than ever before. I think the other part is that if you make international money transfer easier and cheaper, people will use it more, right? You no longer have the hassle of going to a local bank or getting charged a lot if you don't want to. So, you know, you can send $50 to...a grandmother can send $50 to her kids who live overseas for their birthday and it's...that money isn't completely eaten up in fees, and it's easy to do and you can do it from your phone. So I think the accessibility is part of it.
And I think the third thing that I think is really kind of helping expand that is small, medium businesses, freelancers, these kind of micro businesses, people that before would never have been able to have an international business now can, thanks to the internet. Like if I'm a designer, a developer, I can have clients overseas. If I'm a small local business, I can have an e-commerce store that's selling overseas. So I think that has enabled a whole new version...a whole new kind of generation of international commerce that didn't really exist before. And obviously, there's a massive amount of payments that go along with that.
Liz: Yeah, okay.
Marc: Yeah. It's interesting how much more now you hear about...people just will tell you like, "Oh, don't use a bank to send money overseas. Make sure you're using a dedicated service." What are your kind of like biggest tips, I suppose, for someone who does, you know, live overseas maybe and is accepting different payments from...maybe they're a freelance or something. What are your biggest tips for them for getting the most out of their work and the transfers that are coming in?
Nick: Borderless accounts is a really good use case if you're getting lots of payments in. I think the other thing is, we actually see...so word of mouth is like our biggest growth channel, which is really interesting, and especially for use cases like that is like if you're the recipient, don't assume that the person who's paying you knows that you're...you as the recipient end up with a lot less, right? Like if you prefer to be paid one way or another, let them know. I think that's a big part of it. And we see that through our, like, kind of growth channels and word of mouth is a big part from recipients telling the people who...their clients or their senders, "Hey, this is how I wanna be paid." So I think that can be a big part of it.
Marc: That's interesting. And the other question I had is, when you do wanna send money overseas, you often hear, you know, like monitor the rates and kind of pick the best time. Do you have any best practices or tips for someone who wants to do that? I have like, say, three weeks that I need to send this money overseas, like what should I be looking at or can TransferWise help let me know or something?
Nick: Yeah, totally. I mean, I think that the main thing is that, like, we want international money transfer to not just be the domain of people who are like trading currencies, right? We think it should be accessible and easy for everyone who has a need, they can do it. So you shouldn't have to be an expert in like watching currency markets to be able to send money abroad. So, I mean, we have something called a rate alert system, which you can sign up for on the website. And what's cool about it is, you can choose three different types of rate alerts if you want, depending how savvy or how closely you want to watch that. So you can sign up to get a daily email and choose the two currencies you wanna compare, and then we'll send you what happened that day with that particular currency route.
Or if that's too much and you're like, "I don't need that much information, I just wanna know when it hits a certain level," you can type it in and say, "I wanna know when the Aussie dollar gets to 85 cents, for example, of U.S." We'll send you an email and say if it hits that level, or if you're like me and you would probably put like a $1.10 because you're insanely optimistic, we can...the third option is, you can just sign up for getting an email alert when it's at like a two-week high. So that's a really good example of you're like a month out from your holiday or whatever, or sending money to family, friends, the two-week kind of option can be the most realistic good option for, "Okay, where's the highest point in the past two weeks? Now is the time to send."
Liz: Yeah. Because I always have that nerve, it's usually when I'm going, you know, to the U.S. or something and it's like a month before the holiday and I'm sitting there with my savings ready to go and I'm like, "Do I do it now? Do I do it now? What about now?"
Marc: Your wad of cash in your hand.
Liz: Yeah, just like sitting there with my money just absolutely terrified that I'll, you know, if I do it then and the next day they're like, "Oh, it's improved." I'm like, "Ah."
Marc: It's the worst fear.
Liz: It's terrifying.
Adam: Now, the other end of the spectrum with that of kind of having quite a while to sit there and watch your rates and make sure you're getting the best rate, is one of the things that has been such a headache with international transfer is the speed, you know. The amount of time it takes so that if you need to pay someone quickly or you need to be paid quickly, it can be like a several-day waiting period. And if you want to get paid quicker than that, it can get very, very expensive. So is there anything that TransferWise is doing to kind of I guess truncate the process of sending or receiving funds internationally?
Nick: Yeah, totally. I mean, speed is after price for most people, the most important factor of how your experience was with sending money internationally. It sounds a little bit surprising sometimes to people when I say it, but our eventual goal is that we want all money transfers to be instant. It's a technical challenge, it takes time, it doesn't happen overnight, but that is the eventual goal. But part of the way that we kind of can be faster than the banks, on average, on most currency routes, is just the way that we're set up as a system. So when you normally send money abroad through your bank, it goes through something called a correspondent banking system, right? So, if I'm sending money to a Barclays account in the UK, it doesn't necessarily just go from Commonwealth direct to Barclays. It might go to HSBC then it might to Deutsche Bank or UBS, or someone else. You know, it goes through several intermediaries.
Adam: Oh. Everyone is getting [inaudible 00:38:20] their paws on it.
Nick: Everyone is taking a cut, obviously...
Marc: So why does it [inaudible 00:38:24]?
Nick: ...and it slows it down. It's just the way that it's been...you know, legacy systems that they've been set up in the past. But the way that we work is, your money doesn't actually ever cross borders with TransferWise, most of the time. So we have a system of local accounts all around the world. So if in the same example, I'm sending money to the UK, I pay my money into a TransferWise account here in Australia, I get shown the real exchange rate, less the fee, the corresponding amount that remains is paid out from a TransferWise account in the UK to the recipient account in the UK.
Adam: Oh, wow.
Nick: So that lets us, A, take out a lot of the price, but also massively speeds it up as well.
Adam: Wow. Man, that's so handy. So with the other banks, it's basically like that Watchtower system in "Lord of the Rings" where they have to light torches so that the next person can see it.
Nick: They do a smoke signal...
Adam: Exactly.
Nick: ...with the amount?
Adam: Yeah. It's like they have to actually physically be able to see it. Yeah. Man, that sounds so archaic, doesn't it? Yeah, man, that's so key because it amazes me that it actually does take so long with banks. You know, in a digital economy that it would still take so long.
Marc: Especially when you see cryptocurrencies and Bitcoin being able to make like basically instant transfers. Yeah, you think like, "Why can't we do that with just regular money?"
Adam: Well, there is an interesting question is, is TransferWise at all involved in or considering involvement in cryptocurrencies as well?
Nick: It is a question we get asked a lot. You know, it's obviously like quite a hot topic, a popular topic at the moment. Right now, you can't send money to Bitcoin exchanges through TransferWise or pay in or pay out in Bitcoin, for a couple of reasons. One is, we're quite closely...like we have the same regulatory compliance requirements as banks under our financial services in most places, so we have to be really careful with anti-money laundering and fraud. And there's a whole bunch of requirements we have to follow to keep our license in all markets around that. So there's some regulatory ambiguity around Bitcoin that makes us take a bit of time. So it's not something that we're like actively implementing right now, but we do get asked a lot about it.
But the other thing, and this is slightly counter-intuitive to me at least, is that we actually don't have that much demand for it. So some of the ways we consider new products is like a new currency wish list. So if the country or currency you wanna send money to, you can't do that yet through TransferWise, you can go on the home page and you can vote for, "I wanna send...you guys should work on sending money to this country." And that's part of the way, not the only way, but part of the way that we prioritize what new currency routes and new products we're building, and the demand we see. And you can vote. There's Bitcoin option right in there. And so we just don't see enough demand right now to kind of justify prioritizing building that before big opportunities. Like we just opened sending money to Kenya a couple weeks ago. And so like when you think about the size of cryptocurrencies versus like a massive country, the opportunity size is not quite the same yet.
Adam: Yeah, yeah. And I guess like it wouldn't be for everyone because some people are looking at Bitcoin, well, a lot of people look at Bitcoin as a speculative investment.
Nick: Totally.
Adam: But if you were talking about just transferring money from place to place, really the...I guess the benefit of Bitcoin is the speed. If you're taking kind of the sting out of the time it takes to transfer fiat currencies places, then why do you need Bitcoin?
Marc: Yeah, so interesting. I was gonna ask also, just out of curiosity, what are the most common transfers? Like, what are the most common countries?
Nick: Yeah. I mean, so UK is our home market, so when we look at it by market share, we have our biggest market share in the UK. We have a market share of about 10% there. So UK, U.S. I mean, it kind of follows the populations and the places you would expect, right? UK, U.S., Eurozone. Those tend to be like some of biggest ones.
Adam: With payments through TransferWise, what percentage would you say would be businesses transacting or individuals who are I guess transacting business deals, versus people who are sending money to family and things like that? You know, basically, parents sending money to their shiftless, irresponsible, Gen Y kids overseas.
Nick: Someone living in Berlin on their parent's dollars getting a monthly stipend from TransferWise.
Adam: Exactly, God, I hate them so much. So I want you to put a percentage to that so I can know what percentage of the customer base to hate.
Nick: The vast, vast majority of transfers are just consumers. It's a little bit hard to put a number on it because within consumers there might be people who have consumer accounts but are actually using it for both business if they're a small business, as well as personal reasons. But, yeah, business is a small but growing part. So it's a little bit hard to put a number on it, but the vast, vast majority is just normal people sending money to family and friends, or their bank account back in their home country, or paying off student loans, or mortgages, or bills, or things like that. Yeah.
Marc: Yeah. Because making a big purchase, like buying a property overseas, you really need to iron out how you're gonna get the money there, when you're gonna send it. Because you could potentially lose a lot of money on that just on that transfer alone.
Nick: Thousands of dollars. Yeah.
Marc: That's interesting. So what does the future hold for TransferWise?
Nick: Well, Borderless is expanding, like I said. So right now it's Borderless for business in the UK and Europe. We're working on a consumer offering for that, which is not that far away in those countries, but also expanding that offering to Australia. But in other countries around the world, that's one of the really big things that we're focused on. The other is growth opportunities. So, like I said, we're 10% market share in the UK, which is, you know, for sending a billion dollars every month around the world but still only 10% market share at our oldest market, we still have a lot of upside. We're really just getting started. So it's getting more people to know about TransferWise and use TransferWise, but opening up those new currency routes like I talked about before. So places like Kenya, places in Africa, South America. Opening up some of these really big opportunities for people to send money to and from that we don't yet have.
Marc: Interesting. And I was also gonna ask you, so you just mentioned, you know, the UK and growing, and I was reading on the TransferWise blog and it was talking about how a big part of that growth is actually like trusting. It's, you know, getting people to trust in something other than their bank, especially when it comes to technology and fintech.
Nick: Totally.
Marc: So what are your thoughts on all that?
Nick: Yeah, I mean, every kind of research, or survey, or just chatting to a customer in any context you might meet them, trust is obviously a huge barrier to people who haven't heard of us or used us before. I mean, obviously, if you're sending money, you wanna know that it's gonna get to the place you're sending it safely, quickly, and for the amount you saw. So I think there's a couple of ways we kind of think about increasing trust, especially for people who haven't heard of us or new customers. One of the things is that people are generally obviously pretty apathetic about their banks. There are some people who love their banks. I don't know who they are, but in all the surveys you look at, they apparently exist.
There are some people who, you know, are really anti them, but a lot of people are just in the middle, right? They trust their bank, they've used them for years. So to get people to switch to something like TransferWise that they have never heard of potentially or might have issues with trust, we think you need to make a product that's literally 10 times better than what they offer. So on price, on speed, and on convenience, we need to be 10 times better. And we think if we do that we'll get people's trust once they come to us. And we see that reflected in what I talked before is the vast majority of our growth comes from word of mouths, from people telling family, friends, "Hey, you should check this out. I used it and I saved a bunch of money." And so we're obviously just as humans I think much more inclined to trust a recommendation from someone that we know.
Marc: That's right. Yeah.
Nick: It's like the most elemental part of relationships with friends and family, right? And the second piece, I think, of increasing trust beyond just like making a product that is that good that people will talk about naturally, is complying with all the regulation stuff that I talked about before. So being fully regulated, making sure that people understand, you know, we're hold to the same level of bank level security that banks are when sending money, and making sure we're communicating that to people and showing that that's part of what we do as well.
Marc: That's awesome. Okay, well, we're kind of getting to the end of our time, but, Liz, did you have any other questions?
Liz: No. I think we're ready for our final three.
Marc: Yes.
Liz: Yes.
Marc: Okay, great, great. Okay, so we have our three questions that we ask all of our guests. So the first one is, what do you personally like to invest in?
Nick: I own quite a lot of TransferWise shares, as everyone who does who works at the company. We're big believers in...you know, we're a mission-oriented company, we're values, we want everyone to be involved. So that's part of every employee's compensation. So I am invested in TransferWise. But outside of that, shares, I really using like passive apps and ETF things like Acorns that let me just kinda like set it and forget it.
Marc: Yes.
Adam: Acorns.
Liz: Yeah.
Marc: Love Acorns, yeah.
Nick: They're so good, right? And then, generally, like notably the one exception for my investment strategy is probably property, as I think most people in Sydney and Melbourne, and other Australian capital cities might understand.
Adam: Tough out there.
Marc: Awesome. And what's the best money advice you've ever received?
Nick: I think it's two things. One is like...just like old-school rule, diversify. You know, don't have all your eggs in one basket. And the second one is, I love this line, like a good accountant is like a good mechanic, they never need to advertise. So if you get a good mechanic or get a good accountant, you know, that's a relationship you can have forever. Not because taxes in Australia are that difficult to do, mainly just because that's expert advice that I wouldn't have the time or energy to research online by myself.
Liz: Wow, I love that.
Marc: It's good advice.
Adam: Very good.
Liz: That's true. I have a mechanic that I would, like, never leave.
Marc: I'm still finding a good mechanic.
Liz: I'll give you this guy's number.
Marc: Oh, thanks, Liz.
Nick: That's how it goes. Word of mouth. It does it all, right?
Liz: Third question is, what is the worst money advice you've ever received?
Nick: It's not so much advice as it is like lack of advice. Is that a cop-out on the question?
Liz: No, no, that's good.
Nick: But like, I don't know about your opinion, Adam, or what it's like here in Australia, but I remember coming out of, you know, 20-plus years of education, high school, university, beyond university, and still not having any concept of like general, personal, financial management, and then being like, "How did I just spend all that time and money getting educated and no one gave me any advice, good or bad?" You know what? I don't know what's a modern equivalent of like learning how to balance a checkbook. I forgot that.
Adam: I was just gonna say, I don't think I ever properly balanced a checkbook, and then I moved over here and they don't use them. So never had problems.
Nick: Problem solved.
Adam: Never had to learn.
Nick: If you can't balance a checkbook...
Adam: Yeah, exactly.
Nick: ...just move around the world.
Marc: Yeah, I was gonna...I was just about to say I don't know how to do that, but then I was like, I've never seen a check in my life.
Adam: You don't need to.
Nick: You don't have to. But, yeah, it's just like the fact that my worst advice was that I never really got any, you know, from education. You get it from friends, family, and doing your own research if you want to. But I think that's like...just like a glaring hole in how we educate people.
Liz: Yeah, I agree.
Adam: I think it's the same in Australia as well. There's really no practical kind of financial education, financial literacy.
Liz: Yeah.
Marc: I remember learning a little bit about compound interest and how it worked in maybe year 10, and then that was it.
Liz: Yeah, yeah.
Nick: I think the only thing I remember about compound interest at the time that I learned about it was like, "I don't have enough money for this to really apply to me." It's like this sounds really cool if you've already got a million dollars.
Adam: I know. I know. They always started with like...when I was a teenager they'd be, "So if you were to take $1,000 and then...and put in." It's like, "Let me stop you right there."
Liz: How about you give me the thousand bucks?
Adam: You're assuming a lot of stuff about me here.
Marc: Well, awesome. Thank you so much, Nick, for being on the podcast.
Liz: Yeah.
Nick: Thanks for having me, guys.
Marc: Yeah, we've learned a lot, and we'd love to have you on next time you're up here from [inaudible 00:51:15]. Yeah.
Nick: It's a lot of fun.
Marc: Yeah, thank you so much.
Nick: Thank you.
Adam: All right, while we've been sitting here, by the way, guys, after, you know, we've had that nice chat with Nick, learned a thing or two about money transfers, while we've been doing that, my home loan has been conditionally approved.
Marc: Yay.
Liz: Congratulations.
Adam: There we go. So here we go. I can walk you guys through the process as it happens.
Marc: Very interesting. It's cool.
Adam: So we'll see where we go.
Marc: Who was the lucky lender?
Adam: Commonwealth Bank.
Marc: Oh, lovely. Lovely.
Liz: Wow, very exciting.
Adam: Yeah, so, cool.
Marc: That's awesome.
Adam: We'll let you know how it unfolds.
Marc: Yeah. I'm very keen to hear your property journey.
Liz: Yeah, I'm very excited.
Adam: And, you know, what's interesting is that as I go through this first-hand, I feel like there are already so many things that I can write about to bring to you guys. To bring to all our wonderful users at finder.com.au, some first-hand knowledge that I wouldn't have had otherwise. You know, I mean, I research. I've always done my best to really be across everything in the home loan market, but there are always gonna be these little gaps in your knowledge that you're just never gonna have if you're not kind of going through it yourself. And as I find those gaps in said knowledge, I'll fill them with great content for all you guys out there.
Marc: Ooh. I'm excited.
Liz: Excellent. I am excited.
Marc: Well, while we wait for that, I suppose, shall we delve into the world of the ASX?
Liz: Yes. I'm excited to update you guys, because...
Marc: I am not.
Liz: ...I diagnosed my serious, serious problem. Now, I was the set-and-forget person and I really didn't wanna look at what was going on in my thing. I just kept looking at it and I was like, "Oh, I'm down," but I didn't know why. So I eventually went into my portfolio, which I didn't wanna look at, but I finally went into it and I realized it was one stock that was dragging me down, just one stock.
Adam: Yikes.
Liz: So I basically screen-shotted this stock and emailed my dad. And I sent him the link to the company on the ASX website and I said, "This is one stock, you know, should I sell? What do I do?" Because it kind of got to this stage where it was doing quite well, but it just completely tanked. And my lack of stock knowledge was, you know, I didn't know whether you should just sell or you should wait. And my dad was explaining it depends on the industry, it depends on, you know, what announcements the company has put out, and all this kind of thing. I decided to sell the stock, and now I'm on the up again.
Adam: Ooh. Awesome.
Marc: Lovely.
Liz: So I'm still in the negative, but definitely not as much as I was. And I'm increasing, and I'm researching what other company I should buy into.
Marc: Very interesting.
Adam: Well, can I say, Liz, I had kind of a similar journey where I had bought all the stocks that were absolutely tanking, and they'd wiped so much value off my portfolio. I got down to where I think I was $50 above the $50,000 mark where we started, and it was getting pretty bad. I got back up to about like $250 above the $50,000 mark and I decide, you know what? Instead of chasing my losses the way, you know, Chris Brycki told us not to, trying to anchor to zero, I'm going to cut my losses and start again. And so I did. I sold off all my shares that had been losing money for ages and ages, and yesterday I bought shares in one company that I thought this...I feel like this is gonna be pretty decent. This'll help me out. And I ended the day on $50,736.84.
Marc: Nice.
Liz: Nice.
Adam: Just from getting rid of...cutting that dead weight and buying one company that I felt good about. And it went up like, what? Like $400 or $500 in value while I held it.
Marc: Wow. That's a good sell.
Adam: Yeah. So he was right, don't chase those losses. Cut the losses.
Liz: Yeah.
Marc: Yeah, it's really great advice.
Adam: Yeah, I've managed to claw my way back into fourth place. I think I was...I wanna say I was in fifth or sixth, so after yesterday I managed to kinda claw my way back up a little bit. So, yeah, I feel fairly pleased. And I think from now on I'm gonna be a bit smarter about how I do things.
Liz: I wanna be smarter, too.
Marc: Me too.
Adam: You know, I've been following a strategy. Like, you know, I think what I'm gonna do is just be dumb. And yesterday I thought, "You know, what if I gave it a shot?" Just tested the waters, being smart instead.
Marc: And it worked.
Adam: And it paid off.
Liz: That's what I do. That's why I emailed my dad.
Marc: We had Daniel Byrne from easyMarkets on the podcast quite a few episodes ago now, and it was just an introduction into trading foreign currencies and how it works. And as part of the road test, I put a bit of my own money in and I put my first trade on, and I closed it actually this morning to make a little profit there.
Liz: Oh, really?
Adam: Nice.
Marc: Which was really cool, yeah.
Liz: That's awesome.
Adam: Well done, Marc.
Marc: Yeah, so the trade was on gold. Gold and the U.S. dollar.
Liz: Wow.
Marc: And I don't know.
Adam: Which one were you shorting?
Marc: I was shorting the dollar.
Adam: Against gold.
Marc: Yeah.
Adam: It sounds like a smart move, man.
Marc: Yeah. So it's been actually really interesting. You know, like I said in the previous episode, it's the biggest market in the world and things change so fast and so often that, yeah, you really...if you do like that sort of like fast-paced, yeah, trading, then I can see why it would appeal to you. But I'll keep you updated on the next trade. So next week...
Liz: Yeah, so was it quite scary making the trade?
Marc: It actually was, yeah. Sweaty palms, but yeah. Because obviously, you know, you have to...because things are so volatile, you have to set your...you have to be safe. You know, you have to set your stop losses and your take profit level so that if things do fall, you don't obviously just end up losing everything. You know, you have to really trade safe, which is the main thing that Daniel sort of taught it at the easyMarkets Active Traders seminar. So, yeah.
Adam: Now, we won't reveal because the strategies you can employ have charming names.
Marc: They do.
Adam: We won't reveal them because obviously that's, you know, a trade secret.
Marc: Yes.
Adam: So, we'll make up names for them. I'll just ask if you decide to go for a trading strategy with the Charleston Fox Trot or the Texas Enema?
Marc: Oh, definitely the Texas Enema.
Adam: Texas Enema, it's a tough strategy because the thing is, with the Texas Enema, it's big and it's bold. It's gonna cause some pain in the short-term, but everything comes out okay in the end.
Liz: Oh my gosh.
Marc: That should have been the winning joke of that joke contest last week.
Adam: See, there you go. Why didn't I submit that?
Liz: Oh dear.
Marc: But, yeah, so I think the ASX game registration is still open.
Liz: Oh, really?
Marc: Yeah.
Liz: Yeah. And I think a few people in our league are yet to start, so if you wanna get involved, definitely sign up and you can still get ahead from some of the people in our league. So it should be fine.
Marc: Yeah, like joining this challenge in the ground floor will actually put you ahead of me.
Liz: Yeah.
Adam: Yeah, you'll start out with a considerable amount more money than Marc.
Liz: Yeah. So if you wanna beat Marc, which we all do.
Marc: Exactly.
Adam: But can I say, almost everyone, because yesterday it was actually a very good day on the ASX, just across the board it was a very good day. Everyone has clawed their way up considerably. Like we had people who were looking...they're sitting on $2,000 losses or more, and everyone now is within less than $1,000 of where they started. So that's...
Marc: I did notice a $46,000, I think, a couple weeks ago, but I think that that person's regained.
Adam: Yeah. So people are looking much better than they used to.
Marc: And who's on the top of our leader board, Adam?
Adam: Gules, Gillis [SP].
Marc: Gules. Smashing it.
Adam: Yeah, our good friend, Lee, who's absolutely...$52,826.69. I mean, that's a pretty...
Marc: Hats off.
Adam: That's a tidy sum.
Marc: Can you imagine if Gules was just like Mark Bouris?
Adam: It could be. We don't know. We have no idea. It totally could be.
Liz: Mark Bouris, is that you?
Marc: Or, yeah, just some stock of weirds.
Adam: It could be Jordan Belfort, for all we know. We have no idea.
Marc: It probably is. Probably listening.
Adam: I'd say that there's nearing 100% chance that is.
Liz: It's secretly me, guys. I just didn't wanna show you guys up too much.
Marc: It's Liz's dad.
Adam: Yeah, exactly. It's Papa Barry.
Liz: He just didn't wanna show me up too much.
Adam: That's right. He's like, "I'll have to pick a student in here so as not to embarrass my daughter." If she'd take my advice instead of zoning out and checking Instagram while I'm trying to give her stock tips.
Liz: It's basically what happens.
Marc: But yeah. So it's just been really fun. If you guys wanna join, we'll put the instructions again on the page, but, yeah, a big thank you to all of our listeners and possibly viewers.
Liz: Possibly, hopefully.
Marc: Hopefully. And thank you Liz and Adam.
Liz: Thank you, Marc.
Adam: Thank you.
Marc: You're welcome. And we'll catch everyone again next week for another episode of the Finder Money Podcast.
Announcer: Thanks for listening to the finder.com.au Money Podcast. Head over to www.finder.com.au/podcast to find the show notes for this episode and more great episodes. The Finder podcast is intended to provide you with tips, tools, and strategies that will help you make better decisions. Although we're licensed and authorized, we don't provide financial advice. So please consider your own situation, or get advice before making any decisions based on anything in our podcast. Visit finder.com.au to learn more about how we're regulated, to compare your options, or to access our terms and conditions.
ASX sharemarket game instructions - join us!
- Go to the ASX website and create an account for MyASX
- Complete your registration for the sharemarket game
- When registered, go to 'Game play' > 'Leagues' > 'Join Leagues'
- Enter in the following details: League ID: 19917, password: angusrox123, league: finderAU
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