Cheapest Way to Send Money Abroad
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Sending & Receiving Money From Abroad Can Cost You
When living abroad, sending and receiving money from abroad are regular occurrences. If you are an international traveler, a digital nomad, or an expat, chances are you will be managing your money across borders. This process can sometimes be complex, and the fees from repeatedly exchanging money into foreign currencies can start to add up. Thankfully, there are plenty of cost-efficient ways to manage your money, no matter where you are. Keep reading to find out the cheapest way to send money abroad.
Though a bank may seem like the most obvious place to make international money transfers, it can actually be the most expensive option, because the exchange rates are usually unfavorable and the fees can be high. Banks can cost an average of 11 percent of the amount you’re sending. Typically, the international cost of a wire transfer from the U.S. is about $50, which can start to add up over time. If you do not want the bank to eat up more of your finances, here is some basic information about how to make international money transfers cheaper.
Why Make International Money Transfers
It’s common to think of international money transfers for business reasons, but it extends beyond corporate purposes. There are tons of reasons why someone would need to send money overseas, like investing in property for a vacation home abroad or sending money to friends or family who live overseas. Most commonly are money transfers made for those who live abroad.
With the digital age and COVID-19 pandemic enabling more remote work opportunities, being a digital nomad and/or working remotely abroad has become more popular. Many people who work for American companies can now choose to live abroad. This often results in paychecks being deposited into American bank accounts, then needing to transfer that money to an international account to pay for everyday living expenses abroad. Some digital nomads do not have any direct income in their foreign bank accounts, so they rely on international money transfers from their U.S. bank accounts.
As this is becoming more common, it makes sense to utilize services that specialize in sending and receiving money overseas. The cheapest way to send money abroad is to use a service like Wise or Xe that make it affordable and easy to send money from one country to another.
Sending & Receiving Money Abroad with Wise (formerly TransferWise)
Wise, formerly known as TransferWise, is by far the most popular option for transferring money internationally. Wise is a multi-currency service that enables you to make international money transfers at the real exchange rate with no hidden fees. With Wise, you can hold 52 different currencies for free, and convert currencies with the real exchange rate. You can also connect all your bank accounts and receive a Wise debit card to make transactions.
If you use a bank account to fund your transfer with Wise, the fees to exchange are typically 1% of the transfer amount. Below are the fees for transferring large sums of money from USD to Euros using Wise.
1,000 USD to Euros: Pay a fee of $5.30
5,000 USD to Euros: Pay a fee of $23.97
10,000 USD to Euros: Pay a fee of $41.31
Use the link below to get $0 transfer fees on your first transfer up to $600.
Sending & Receiving Money Abroad with Xe
Xe is another widely used international money transfer service with great exchange rates. While using Xe, you can convert currencies with real-time exchange rates with fast delivery. Xe enables money transfers in 65 currencies to more than 170 countries.
Like Wise, you can hook up your bank account information and receive an Xe debit card to make transactions. The app also comes in 11 different languages for ease of use. When transferring USD to Euros, the fee depends more on the payment method than the amount of money.
Unlike Wise, Xe does not charge transfer fees if they can help it. The minimum amount you can transfer without experiencing a fee is $500. With Xe, you will typically only experience a fee if there is a third-party bank fee, or if the payment method in which you choose to send the transfer has a fee.
The Smartest and Cheapest Way to Send Money Abroad
This is NOT financial advice. As exchange rates vary widely day to day, the best way to get a good rate and keep your money in your account instead of paying fees is to do your research. No service always has the best rates, so using multiple apps/services can be beneficial. The services you use will depend on when, how much, and where you are sending the money. It’s always best to compare periodically to ensure you are getting the best deal.
Renovating Life contains affiliate links. If you make a purchase through these links, we will earn a commission at no extra cost to you. As an Amazon Associate, we earn from qualifying purchases. Links like this allow us to continue providing top-quality content at no cost to you.
Sources:
Kelly Anne Smith (2022) 4 Best Ways to Send Money
Spencer Tierney (2022) 5 Best Ways to Send Money Internationally
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