How to move money from one currency to another without losing out
These are some of the most sensible options to consider when you want to change money from one currency to another.
There are a few different situations in which you might want to change your money from one currency to another. Maybe you plan to buy a property abroad, are going on holiday, or want to invest in a foreign currency, so what is the best way of doing this?
Check the Rates
The starting point for making a transaction of this type is in checking the current rates. This is easily done on the internet and all you generally have to do is type in the two currencies you are interested in. Known as a currency pair, this is shown as GBP/USD or GBP/EUR, for example.
What you will see online is the official rate, which is good to know but it isn’t what you will get when you change your money with most exchange services. They make their money either from charging a commission fee or else from offering a lower rate.
You can check the exact terms online for most banks and travel money services. Since some charge fees and others don’t, the best approach is to see exactly how much you would get if you were to change a set amount of pounds.
Use an Online Service
While many of us will use the local bank or holiday money service when going abroad for a week or so, other companies specialise in changing cash from one currency to another online.
Currency exchange websites should give you a better deal when you want to move a lot of money into a different currency. TransferWise and Travelex are a couple of options worth considering if you think that you will be moving money around.
Online wallets like Skrill and the ever-popular PayPal usually let you keep your balance split between various currencies. This means that your cash will always be available for moving across to a different type of money whenever it suits you to do so.
Choose the Day of Week Carefully
The exchange rate fluctuates, so what you could get today might not be the same as the amount you would receive tomorrow or the next day. This means that the exact figure you would receive changes from day to day and even from one hour to the next.
While there is no guarantee of the rate being better or worse on any certain day of the week, studies have shown that it does tend to follow some patterns. For example, exchange rates are often better at the end of the week while Monday frequently sees the rates move less than on other days.
This is largely down to the way that the big currency traders do business, starting the week slowly and then trying to round it off on Friday by closing out their positions. You might not want to base your entire strategy around selecting certain days of the week, but it is definitely worth bearing this information in mind.
Follow the Markets
Ultimately, the value of each different currency comes down to how appealing it is to traders on the forex market. This is the biggest global financial market, and it is open around the clock, as traders all over the planet buy and sell currencies to try and make a profit.
Traders act on developments in the worlds of industry and business. They usually deal with a currency in increments of 1000, using leverage to aim for big profits even with a relatively small amount of cash at stake. Traders use the pairs mentioned earlier, such as GBP/USD, to try and profit from the upcoming fluctuations in the rate between these currencies. Those new to this may first need to pick the best broker, with sites such as above offering guidance for those unfamiliar with currency trading.
It is a fast-moving market and not everyone can correctly predict what will happen next. Yet, if you like the idea of following the markets then it could give you an edge in working out when it is best to change your money over.
These are some of the most sensible options to consider when you want to change money from one currency to another. How much effort you go to in an attempt to achieve the best price will probably come down to how much cash you want to change and how important it is to you.