How Do You Move Money Cheaply and Safely Abroad

It’s one of the biggest headaches that expats and their loved ones face, as it isn’t just the upfront costs you have to worry about. It’s also crucial to find the best exchange rate that makes your money go further.

If you are transferring payments to another country, banks could charge as much as £25 for the privilege and often give you a poor exchange rate. The good news is that some banks, like HSBC and Halifax, offer free exchange services for certain countries. They also provide a much better exchange rate than you would expect from a regular account. This is well worth considering if money has to be transferred on a regular basis, but both accounts (at home and abroad) may have to be in the same person’s name. If you wish to send money to another account, you can ask the recipient to set up an account with Citibank, which allows transfers to popular destinations across the world.

Of course, the upheaval of changing bank accounts might not be practical for one-off, larger payments. In this case, certain providers, like the Post Office and Pay Pal, will allow you to switch money into expat bank accounts for a small fee.

A better solution for transferring large amounts of money could be currency exchange specialists. The trick is to seek out a specialist currency broker and compare exchange rates. This will be a far cheaper route for significant sums, and could offer a much more competitive deal than your high street bank. Don’t forget – even the smallest differences in the exchange rate can amount to hundreds, even thousands of pounds more (or less) in your pocket.

A major factor to bear in mind is the level of protection for your money. Smaller currency brokers or exchange specialists may offer tempting deals but can’t guarantee you’ll get all your money back should they go bust. The chances of this happening are usually quite small, but larger providers in the UK are more closely regulated and can safeguard your money. Despite their (often) poorer deals, banks can give you much better protection, thanks to the Financial Services Compensation Scheme.

Whether you’re living in an offshore haven, such as Jersey or Guernsey, or in another far-flung country, offshore banking might be the easiest route of them all. This way, you’re dealing with a trusted bank and can manage complicated financial affairs through one provider, both in the UK and overseas. It could be more convenient and cheaper to transfer money into offshore bank accounts, and insulate you against currency fluctuations if you’re a regular traveller.  Tax is also not deducted from any income you make on savings or investments, as long as money isn’t transferred into your country of residence.

Expat bank accounts allow those who’ve moved abroad to take advantage of their new tax status but many may not be certain how to use these accounts and stay within UK tax regulations. If in doubt, seek the advice of a financial adviser. 

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