Transferring money to Spain
Moving to a new country has its fair share of challenges, not least of which is dealing with your finances. You will likely need to transfer funds from your old home to your new one until you get established and it is important to have a way to send money back home as well, whether it be for bills, gifts or emergencies.
Nowadays there are countless ways to send money internationally, though some are faster, cheaper and more convenient than others. This guide takes a brief look at four main transfer options and will help you find the one that best suits you.
Safety is a big concern when sending large amounts of money and banks provide one of the safest options available. All you need is the name, address and account details of the person receiving the money and you can conduct the transfer online yourself. The fastest, cheapest and easiest bank transfers are those conducted through international banks.
Unfortunately, many banks have strict regulations regarding how much and how often you can send money internationally and it can take up to a week for the transferred funds to become available. Banks are also notorious for having poor exchange rates and fees are often charged to both send and receive the money.
Money Transfer Services
Fast, easy and relatively safe, money transfer services such as Western Union and Moneygram provide an effective way to send money almost anywhere on earth. All you need to send money is the name of the recipient and all they need is your confirmation number as well as a piece of photo ID. Transfers are paid out via cash or bank cheque, so you don’t even need a local bank account to collect it.
The downside of these services is that they are very expensive and offer some of the worst foreign exchange rates available – the more money you send the less worthwhile it is. Further, larger transfers cannot be completed online and there are limitations regarding how often you can send money.
PayPal is a relatively fast and extremely easy way to transfer money and it is now available in more than 200 countries. Both the sender and the receiver need to have a PayPal account (which is free) and to send money you simply need to know the name, email or phone number of the person you are sending it to.
The main problem with PayPal is the fees involved, which only increase when sending larger amounts. The sender is charged a fee of 1% of the sent amount and the recipient is charged 3.9%; further fees are charged if a credit card is used to pay for the transfer or if the funds need to be converted into the local currency. It also takes roughly 3 days for transferred funds to become available.
Foreign Exchange Brokers (Forex)
To get the most out of your money transfers you need to find the best exchange rates available and few can compete with those offered by foreign exchange brokers. Forex brokers even allow you to schedule transfers for when the rates are most favourable or lock in current rates for future transfers.
Many Forex brokers provide fee-free services for large transfers and regular customers and you won’t find anyone with more knowledge of the currency markets than a Forex broker. Although you must be aware that sending money through Forex is only feasible for amounts over €5,000 EUR.
The following table compares the approximate fees associated with sending €5,000 EUR to Spain using four common options. All amounts include the cost of both sending and receiving money.
|(From)||Bank Transfers||Money Transfer Services||PayPal||Forex brokers|
|Australia||$45 (AUS)||$300 (AUS)||$368.15 (AUS)||Free|
|Canada||$27 (CAN)||$300 (CAN)||$352.54 (CAN)||Free|
|USA||$45 (US)||$217 (US)||$269.09 (US)||Free|
|China||354.66 CNY||217.34 CNY||1,670.19 CNY||Free|
|India||5,758.78 INR||n/a||17,281.38 INR||Free|