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How to Get the Best deal on Regular Overseas Payments

How to Get the Best deal on Regular Overseas Payments

There are many reasons why someone might need to send regular sums of money to a foreign destination.  Many people own properties abroad and need to make mortgage payments while others have moved overseas and require their pension payments to be sent to them on a monthly basis.  Perhaps you get paid in a foreign currency and need to send the money home or maybe you are studying abroad and receive an allowance from your parents.

Whatever your reason is for sending money from the UK to overseas destinations, you will want to be weighing up the options available to you .  If you don’t then over the course of a year (or more) you could be wasting a substantial sum of money and/or time.

When it comes to exchanging currency, there are two things you want to evaluate:

1.  The rate at which you are transferring.  This can vary dramatically depending upon the company you use and a little bit of comparison can leave you far better off.

2.   The convenience the broker/bank/bureau provides you.  As we will discuss later, there are options available to you where your funds can automatically be transferred on a specific day of the month to a designated recipient.  This can save a lot of time and effort when compared to manually contacting your bank/broker each and every month.

So how can you go about getting the best deal?

Many people simply use their banks to send payments into other currencies.  Although this is pretty convenient (especially with internet banking), it is probably the most expensive way you can go about doing it.  This is due to the wide spreads that banks tend to charge.  Check out this guide on exchanging currencies with your bank to find out more about why banks are so expensive.

The more aware of us will use a specialist foreign exchange broker to send regular payments abroad as the spreads are tighter meaning you will pay less sterling for your required currency.  There are two ways to transfer funds with an FX broker:

1.  Adhoc transfers.  You should receive a better rate than through a bank but will have to phone the broker each time to setup the transfer.

2.  Regular payments.  Many people find regular payments to have the best balance between value and convenience.  The rate you’ll get through the broker will be (in the majority of cases) much better than what your bank will offer.  You will also have the convenience of the money automatically transferring across to the desired recipient automatically

Most brokers offer a regular payment facility and many allow you to either fix the rate at what it is at any particular point in time.  This is especially good for those people that want the peace of mind that they will know exactly how many pounds they will need to send to fulfil their overseas commitments.  On the flip side if you are receiving funds in an overseas currency due to emigration, you will know exactly how much your pension, maintenance, salary is going to be worth to you each month.

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