Foreign Money Exchange And Saving Money While Relocating Abroad

 
Foreign money exchange is one of the most painful things when relocating overseas. You always feel that you are loosing a big piece of your hard gained money.
 
By far the main discussion among expats is the foreign currency exchange rates. It doesn’t matter what is your country of origin, you will eventually find yourself complaining about how much money you loose because of that awful currency exchange rate and the extremely high commissions of the bank.
 
currency-exchange-ratesThis realization is even stronger when you are researching the possibility of buying a house in your host country. Some of you will probably need to sale their house in their country of origin in order to be able to put a down payment on the new house. We are talking major money here that will have to be exchanged into the currency of your host country.
 
Wow, just think how much money you might be loosing in the process.
 
Even, for those of you who are not planning a huge purchase like a new house, the foreign exchange conversion is extremely annoying. Just to share with you from my own experience – Our salaries in Canada were paid in USD, and we had to exchange the USD into Canadian Dollars. At the beginning of our posting it was looking great as we received 1.56 Canadian dollars in exchange for 1 USD. But, after 4 years the Canadian Dollars got stronger (The Canadians were so happy about it, and kept bragging how their travels to the U.S.A. are much cheaper now), and we received only 1.12 Canadian Dollars in exchange for 1 USD, and the commission of the bank didn’t change. We felt really frustrated.
 
Of course there is nothing that you as an individual can do about the global economy and the currency exchange. You can certainly write about this to your head office in your country. Maybe it will push them to consider your situation and to give you a raise, or extra money to compensate for the loss. But, even if it does help, in the good scenario it is not enough, and in the bad scenario until they reach a decision you are already gone and the money is paid to your replacement… Bureaucracy at it’s best.
 

So, how can you save money when transferring funds while relocating abroad?

 
Many people assume their bank to be the best place to exchange currency, unaware that the banks usually offer fairly non competitive exchange rates, slower transfer speeds, increased transfer charges and limited access to the various foreign exchange products available.
 
But, a specialist currency broker can significantly improve the financial efficiency of your overseas payments, and gain access to products that may be hugely beneficial to you.
 
For Example:
 
WorlFirst, foreign exchange company, offers the following benefits to expatriates
 

  • Save clients between 0.5% and 4% on the amount they transact.
  • Fast international payments (same day in many cases).
  • No commission and no bank receiving charges.
  • Bespoke and professional service with a dedicated broker.
  • Free rate and market watch service.
  • Access to products that the banks may not offer.
  • What type of products are available at WorldFirst foreign exchange company?

     
    Spot Contracts
     
    If you already have the funds in place, you could arrange a spot transaction. This is simply the exchange of one currency for another at the current market price where the settlement happens within two working days. A broker should be able to get you a significantly better exchange rate for this transaction.
     
    Forward Contracts
     
    A forward contract allows you to fix a rate now for a date in the future (up to 2 years ahead). This means the rate is fixed regardless of exchange rate moves, thereby protecting you if the exchange rate moves against you.
     
    International Currency Exchange Options
     
    A currency option, like a forward contract, allows you to exchange one currency for another on a future date, thereby protecting you from negative movements in the exchange rate. However, with an option, if the rate moves in your favour you can still take advantage of this. There are very few brokers that can offer international currency exchange options to clients as it requires additional FSA authorization. One such broker is World First
     
    Regular Payments
     
    If you will be exchanging a set amount of funds on a regular basis for mortgage payments or pension transfers, you can set up a regular payment order which will automatically transfer the funds on a regular basis.
     
    Elisabeth Dobson of foreign exchange broker World First warns, ‘don’t leave your foreign currency transactions to the last minute. It could leave you exposed to the prevailing exchange rate and you may not have adequate funds to move overseas. With some of World First’s products you can protect yourself against negative exchange rate fluctuations. The options above are becoming more and more popular especially given the recent volatility and unpredictability of the currency markets. Forward planning will ensure your emigration can go ahead as planned’.
     
    If you would like to speak to a dedicated foreign exchange expert about your individual requirements, please go directly to www.worldfirst.com and request a call back.