In the lead-up to Christmas, more and more Australians are sending money to friends and family across the globe.
Analysis from finder.com.au has shown that earlier this year there was a 155% year-on-year hike in the number of Australians looking to send money abroad.
With a variety of money transfer services enabling you to send money overseas in minutes, it’s important to find the cheapest and most appropriate option for you and your family.
Here are four things you need to know before you send money abroad this holiday season:
1. Transferring larger sums vs smaller separate amounts
If you usually transfer smaller separate amounts overseas throughout the year, you might want to consider sending a larger lump sum this Christmas.
However, you do have to consider if the money you send will be used up too quickly if you decide to send it all at once.
Money transfer services will charge you a fee for every transaction, so you can save a lot by only having to pay this fee once.
Additionally, they typically offer more competitive rates and lower fees when you send a larger amount so keep this in mind next time you’re organising a transfer.
2. Online money transfer providers vs the big four banks
Online money transfer providers and the big four banks all charge fees differently.
After reviewing these fees based on the average amount of USD returned for AUD$5,000, finder.com.au has revealed that online money transfer providers were, on average, $145 cheaper than the big four banks.
However, to find the best deal for your specific situation, it can be a good idea to compare your money transfer options online.
This way, you can enter the amount you intend to send and the currency exchange to see the transfer speed, transfer fees, rate and amount that will be received to find the most competitive option.
3. Beware of hidden fees and example exchange rates
While online calculators can be useful, it’s important to make sure the values you’re getting are the actual numbers rather than just an example.
For instance, some major transfer providers will calculate the amount returned based on an average or indicative exchange rate (rather than the actual rate you’ll receive).
To make sure you’re getting an accurate number, the best thing to do is to create an account online with one or even multiple providers to compare prices (with the real exchange rate you’ll receive).
This will generally allow you to get a more accurate estimate of the fees and rates involved.
4. Each company has different security available
The final but potentially most important thing to note is the security offered with each transfer service.
This is particularly important if you’re new to international money transfers or you’re deciding to use an online service you haven’t used before.
For example, you need to determine what happens to the money you send if it is not picked up by the recipient.
If you’re unable to find this information, it’s most likely time to find a more reliable provider, even if this means higher fees and a longer transfer time.
It could be worth the peace of mind!
Whether you’re sending money back home or to friends and extended family, it’s important to know your options and to find a reliable money transfer service.
This way, you can rest assured that your recipient will receive the money safely and in time for the festive season.
Bessie Hassan is a Money expert at finder.com.au
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