Make the most of your money when changing currencies
As the financial turmoil around the world continues, it is more important than ever to make sure you get the best exchange rate when buying overseas. There are two ways to achieve this: timing your purchase; and getting the best deal on the day.
Timing your purchase
If you are buying overseas, you will usually have a window of a couple of months before a completion payment is due – or a longer period to consider if you are buying off-plan and sending stage payments over the course of a build.
Whatever currency you need, the exchange rate will fluctuate over this period of time – so how do you know what the sterling cost is going to be? When is the best time to buy your currency?
An experienced currency dealer like Moneycorp will be able to tell you what’s happening in the market in simple English. If you need to send money to Tenerife, for example, which way is the Euro heading and why?
For these money transfers in Euros, when is the next announcement regarding European interest rates and how might it affect the exchange rate?
While there is no crystal ball and nobody can see into the future, it can pay to have an idea of what is moving the markets. This is how your currency broker can help you to make an educated decision as to when the time is right for you.
Furthermore, if exchange rates are good (or you’re worried about them getting any worse), you can also lock into a “Forward Contract” to guarantee your rate for up to two years in advance.
The beauty of buying currency in this way is that you have a definite sterling equivalent for a future currency requirement, but you only need about 10 per cent of your Pounds available to secure the rate. The balance is due when the money needs to be sent.
Currency companies watch rates all the time, so if you have a target budget in mind, they can let you know if the market moves in your favour. All in all, you are likely to end up more in control of your finances and with a better deal than just by buying your currency at the last minute when it is required.
Getting the best deal
When you decide to make a currency purchase, it’s not usually your high street bank that will get you the best rate. An independent broker such as Moneycorp will save you up to four per cent compared to a bank’s exchange rate – or £6,000 on a £150,000 purchase!
Currency brokers are registered with HMRC as money service businesses, and as they don’t use credit or speculate on the markets, the system is incredibly safe.
Because currency companies deal only in foreign exchange, you should also expect a first class personal service and your own dedicated dealer to guide you through the process. It is also less confusing to speak to an experienced broker, rather than the call centre environments presented these days by the banks.
Good currency brokers won’t charge you any commission and should have minimal or zero transfer charges – so you can save money right across the board. You can find more information on this and property related matters on the Tenerife Property Guide site.
