Getting the right exchange rate from dollars to pounds can save you a lot of money; four or five figures depending on how much you’re transferring.
Here, we show you exactly how to get the best exchange rate, and we reveal how you could be paying thousands a year more than you need to…thanks to things you have no control over.
Pay more…or less….depending on the day of the week
You probably know that currencies fluctuate against each other.
So, the exchange rate shifts day-to-day, and this impacts how much more (or less) you end up with at the end of your transfer.
Over a few months, the currency exchange can shift quite a bit. If you’re planning to make a transaction in six months, by the time it actually rolls around you might find you’re getting a lot less than you would have done if you’d make the transfer when you first planned it!
And almost anything can impact the currency exchange rates. For example, the Brexit result meant that anyone transferring the money got 9% less than they would have done the day before!
That’s an extreme example, of course, but it shows how events that you can’t control can cost you a lot of money.
Strategically trying to plan your transaction to gain maximum value is one way. But there are other measures you can take to protect yourself from market movement. Forward Contracts allow you to lock in a favourable rate of exchange for up to two years.
The Great Exchange Rate Robbery
So, when you trade currencies to fund a purchase abroad or to settle an international payment or to visit family abroad, the exchange rate can have a serious effect on how much you end up with.
You know that.
But what you probably don’t realise is that if you trade your money on the high street, you’re not even paying the real rate.
In fact, the chances are you’re paying a lot more.
See, for years there have unofficially been two exchange rates:
One for you, and one for the banks.
Let me explain…
When banks trade dollars for pounds with each other, they pay the “mid-market” rate. This is the actual fair price. The real exchange rate.
When private customers trade currency, though, the banks add a premium on top for consumers. Essentially, they create their own ‘high street’ exchange rates.
That’s how they make their money.
And the thing is, these charges are often hidden, so thousands of people each year are paying more to transfer dollars to pounds than they need to, without realizing it!
Even transfer brokers who advertise ‘zero fees’ are often just adding these extra charges to the exchange rate at the start, so although on paper you’re paying ‘zero commission’…you’re still paying more than you need to.
What’s more, you might also be expected to pay other charges on top of this, such as delivery costs if you book your exchange in advance, or even a conversion fee depending on which currencies you’re transferring.
This has been such a money-maker for the banks that it’s even grabbing mainstream press:
“Banks ripping off holidaymakers over exchange rates” – The Times
“Beware – the foreign exchange rip-off has spread to ATMs” The Financial Times
“Don’t get ripped off on foreign exchange” Citywire
How to never pay over the odds for your currency
If you find a currency broker that offers real transparency, you can exchange at a much lower rate than the banks trade with each other at.
(Not the one they want you to trade at.)
More and more people are finding they can get great exchange rates without having to deal with the banks at all.
At Privalgo, for instance, our experts offer complete transparency and will always help maximise your exchange rate value.
No hidden costs…no commission hidden away…
Just complete transparency.
How we can help you get the best exchange rate
To get great rates, many people start watching currency movements about a month before they actually need to make the transfer.
This gives you time to get a better idea of what good and bad prices look like. It also means you can act fast when the rates fall in your favour.
But what if you don’t want to do that work?
Well, a reputable FX broker can do that work for you, and make sure that you get the best deal possible.
At Privalgo, all transfers are carried out with a personal dedicated account manager who can guide you every step of the way to ensure you maximise value from your transaction.
So, if you’d like to find out more on how you can get the best exchange rate, no matter the currency…
Get in touch
If you’d like to know more, our team is ready and waiting to help.Book a chat with a currency specialist