Organising foreign currency exchange

Finance expert Laura Parsons explains why you should organise exchanging foreign currency long before you move to France so you can take advantage of the benefits

As exciting and life-changing as relocating to France can be, all the factors involved in the initial move mean that the process can be quite costly. Depending on your circumstances, you may find that you have to deal with outlays such as packing up your life at home, transporting your possessions overseas and arranging health insurance. When you then factor in adjusting to the difference in the cost of living, you’re left with rather a lot of financial considerations.

Whether your move to France involves a change in employment or managing a limited pension, with so much to plan and organise, working out how to manage your currency transactions can end up pretty far down your list of priorities.

But preparing for your fresh start in France becomes much easier if you know you’re making the most of every euro. The majority of people moving overseas have to engage in foreign currency exchange at one point or another in order to make wage or pension payments easily accessible or to meet accommodation costs and living expenses. In fact, foreign currency transfers are likely to play a large part in the organisation of your finances before and during your life abroad so it really pays to get things right from the start.

Save money

A lot of people who are new to foreign currency exchange don’t realise that with just a little forward planning and research you can save thousands of euros on your transactions.

While it’s easy to assume that using your bank is the easiest way of transferring funds, it actually isn’t always the most cost-effective or convenient option.

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Setting up transactions with a bank can be time-consuming and most will typically add a £10 to £40 transfer fee on every exchange you make, as well as charging commission. On top of requiring you to meet these additional charges, banks are also unlikely to secure you the best possible exchange rate available at the time and they rarely offer services that you can tailor to your personal needs.

The difference between 84p and 86p per euro might not sound like much but when you’re transferring the kind of sums involved in a typical property purchase, securing the right rate means you could gain thousands.

Although it can seem daunting, getting in touch with a reputable currency broker in the early planning stages of your move, and seeking their expert advice when it comes to handling your foreign currency transactions, really can save you money.

By using a currency broker you can feel confident that your exchanges will be made promptly, conveniently, at a competitive exchange rate and with no transfer fees or commission to pay on top.

Catch the best deal

Currency brokers have staff trained in currency analysis who monitor market movements and currency fluctuations for you. This keeps you informed of any developments as soon as they occur and ensures that you pick the best time to make a trade. By opening an account before you move you’ll be able to discuss all your options and benefit from their support and guidance.

Buying an overseas property can be a lengthy process, and during the time between having your offer accepted and exchanging contracts the foreign exchange market can fluctuate significantly. In fact, the euro/pound rate can move by as much as 10% in a matter of weeks. This can mean that your dream home may end up costing you a lot more – or less – than you’d expected.

Some currency brokers offer a service where a favourable rate can be fixed for up to a year before you need to make the trade. As well as protecting you from losing out because of adverse market movements, this service means that you know exactly what you will be paying for your property from the start and can help you to budget effectively.

Even if you only exchange small amounts you can still save enough to finance some improvements to your new French property or an extra trip to the UK.

Have peace of mind

Getting your foreign currency exchange needs sorted before you move can bring you real peace of mind. Leading currency brokers will be regulated by bodies like the Financial Conduct Authority (formally FSA) and can assure the security of your funds.

Currency brokers with a reputation for quality customer care often assign their clients a personal account manager, who is a dedicated individual you can build a rapport with and who will be there for you whenever you need them.

Furthermore, if you plan on exchanging wage or pension payments to finance your living costs during your time abroad, getting in touch with a currency broker early on will mean that you can schedule transfers so that your money will be ready exactly when and where you need it. Similarly, by using a regular overseas payment service you can pay fees automatically on prearranged dates.

In fact, any time you make a foreign exchange with a currency broker you can relax knowing that your finances are organised, and that the flexible service can adapt with your circumstances.

The first few months of an expat experience can be a challenge, but by organising how you’re going to manage your foreign currency transactions early on you can eliminate some of the stress involved and enjoy having more euros to spend on this important stage in your life.

Laura Parsons is a currency analyst for Tor FX

Tel: 01736 335233

www.torfx.com