Did you know that around 800 million people around the globe send or receive remittances from family members?
Remittances are money transfers that come from another country, most often from people who are working overseas.
If you are planning to transfer money to a family member or friend, there are a couple of tips to help keep your finances safe.
Continue reading to discover some of the best tips for handling international money transfers!
1. Compare Exchange Rates
One of the most important tips to follow when handling international money transfers is to compare exchange rates each time.
Depending on the financial institution that you go to, you might be able to find better rates that will help you save money. Try to look for 3 to 4 places that offer money transfer services. Looking at the exchange rates for these places will give you insight into how much money you can send, along with the fees that come with it.
2. Send Larger Amounts at a Time
Some people think that they are beating the money transfer process and rates by sending small sums of money.
Sending larger sums, however, has proven to save more on fees and is much more reliable. When you are frequently sending small amounts of money, the exchange rate fees can quickly add up, costing you more than if you were to send it all at once.
3. Research Transfer Limits
Depending on where you are sending money to and from, you should research their transfer limits.
When transfers are money than $10,000, you the bank or institution must report your transfer to the International Revenue Service (IRS). Amounts below this number are rarely reported unless there is reason to do so.
It is possible to send more than $10,000 to an account, but be prepared to file documentation and paperwork. The Financial Crimes Enforcement Network may also get involved when you are transferring a lot of money at a time.
4. Understand Currency Conversion
When you go to send money to another country, the US dollars (USD) will automatically be converted.
Understanding the currency conversion rates for the country you are wiring money to is important. Many people recommend checking how much money your USD will convert to. This way, you aren’t surprised by the amount when the confirmation papers come through.
5. Use Standard Transfer Times
Although there are situations where you must send money quickly, you should avoid expedited services.
Expediting the wire transfer could result in a lot of added fees. Unless you need the money in the other account within a few hours, opt to use the standard transfer processing time. This will help you save on the overall cost and you won’t lose additional money. Standard processing times typically take 1 to 3 business days, depending on the company that you are transferring through.
Prepare Yourself for International Money Transfers
When it comes to international money transfers, there are many factors to keep in mind.
Many people send money overseas to family members when they are working in another country. If you need to make transfers, compare exchange rates at institutions and check the currency conversion rates.
To help save money, send larger amounts at a time and avoid expediting the services.
Be sure to check out our blog for more articles about sending money overseas and keeping your finances protected!