FX (Foreign Exchange) Tips AKA Its Your Money : #1. Airports = worst possible place to exchange your money prior to travel or upon landing in a country. Why ? Exorbitant rents on airport land mean inflated margins on goods and services (Hello ?! Beer and a sandwich prices anyone, same applies to your money .. Up to 15% margins on majors and 25% plus on exotics) and fish in a barrel marketing approach .. You are either just about to board a plane i.e. : you have left it until the last minute to exchange so bully for you or you have just landed and have nothing to compare to so well jack the rates before you realise it. Always ask about commissions too. Some airports have 5% commission fees .. In other words if you are buying $3000 worth of a currency and they have applied a 12% margin and a 5% commission you just spent $450 more than you would have anywhere else for the same currency .. Woah. #2. Use a Licensed Provider. This obviously doesnt just apply to the FX Industry .. If transferring funds via IMT (International Money Transfer) to or from another country you can save large sums on the rate and the fee/s by using an FX Provider rather than your bank. We can save clients between 2% and 5% on their transfers, depending on the currency and the amount exchanged, as well as much lower or NO fees on the transaction. So if you are sending or receiving $100K worth of currency and save 2% plus ($2000 and up) on a transfer simply for using a provider rather than a BIG BANK - its ok, they will be ok. They will still count their 30b per annum and gloat to the shareholders - then WOO HOO !! for you. If you do this regularly, like many business clients, and save this every month then Woah Nelly there is an easy $24000 for your bottom line, your Christmas party, your mortgage, shoes, golf .. Point is, its yours. And it is just about getting a quote and comparing. HOWEVER - if that FX Provider doesnt have an AFSL (Australian Financial Services Licence) then you are engaging in an illegal transaction as per the Corporations Act and risk your funds and your compliance with The AFP as per international law. ASK for their licence number. Its not saving money if it is risking your money .. #3. Global Travel Cards are not all created equal. If they EXPIRE, CHARGE you to PURCHASE, LOAD, RELOAD and UNLOAD, apply INACTIVITY FEES, CHARGE to REPLACE lost or stolen cards, apply a CROSS-CURRENCY FEE, RETAIN CARD BALANCE upon expiry or maintain that funds loaded ARE NOT TRANSFERRABLE (which means if you load your own funds onto the card prior to travel and you lose it the bank or provider will replace the piece of plastic but NOT the funds. What the ?! $5000 on your card to travel with ? Nuh uh. You may as well have carried cash, at least you would have been more careful security wise). There are lots of Terms and Conditions and Which Cup Is The Pea Under types of yadda yadda attached to many of these products and doing your homework means reading the FSG and PDSs. This can be compared to punching yourself in the face. You just want to get a good, secure, convenient, transparent product and to go on holiday ? Ha ! Also it is difficult to get after-sales service from a card / bank that is Australian Based when you are travelling internationally. Not much help to hear Well replace it when you get home from a Customer Service Operator when you are calling to say you have lost your card in Spain during the running of the bulls and arent going to be home for 5 more weeks .. #4. Blackmarket Rates are often too good to be true because they are. If you cant believe the rate in Indo or Thailand (for EG) and you arent REALLY confident at doing the math on lots of zeros currencies yourself, then dont bet on the money ending up in your hand being the same as the number on the board. Rigged calculators, slits in bench tops, sleight of hand .. You might think you are getting 11.22 million Rupiah, but make SURE before you leave the doorway. And also be careful .. Arguing over 200K VND (AU$11) might seem like justice but if you are outnumbered 3 to 1 then for the love of the travel Gods just smile and walk away. At the end of the day you are travelling for the experience, not for the haggling over dollars and cents. Get it squared away before you go by using a reputable provider and you will save money, time and headaches. Travel Safe, Have FUN !!!
Posted on: Thu, 22 May 2014 05:37:10 +0000
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