Moving to another country can be an exciting, but often stressful experience. Often, in all the excitement, people neglect to think about some of the financial ramifications of going abroad. Even if you are moving somewhere more affordable, making the wrong financial moves can cost you big. But by following these steps, you can ensure that your move goes smoothly and your finances stay in order. </ br>
Credit can cost youLove your low-interest credit card? Get excited when you rack up rewards points? While some credit cards can be great to use in your home country, using them abroad can be quite costly. Credit card companies charge foreign transaction fees on most of their cards. Also, the bank that issues the card will usually tack on fees of their own. All this means that you could be getting charged 3% or more each time you use your credit card abroad. Some cards are definitely better than others. When abroad, be sure to use a travel card. These cards typically waive transaction fees, but often carry with them annual fees and high interest rates, so make sure not to carry a balance!
Be careful with cashWhile there are obvious risks to carrying large amounts of cash with you to foreign countries, people often overlook extremely high currency exchange fees. While it may be convenient to step off your plane and exchange your Dollars for Pesos, keep in mind that you pay a premium at currency exchange kiosks often charge you a very high premium – often in excess of 7%! Even foreign banks will charge you a premium for exchanging currency, and their ATMS are even worse. If you use your debit card at a foreign bank’s ATM, you can often expect to pay an ATM fee of $10 or more, plus any applicable fees by your own bank. On top of that, the foreign currency will be converted from your account often at a rate lower than the current market exchange.
Go localIf you are planning on living abroad, your best bet is to find a local bank that can serve your needs. Not only is it convenient to have a physical bank near you, conducting business, withdrawing money and completing other financial transactions will be much cheaper and simpler. If you need to transfer money into your new account, Bitwage can transfer funds into nearly any foreign currency at your new bank for approximately 1.5% in as fast as the same day. Traditional banks often charge a hidden 5% conversion fee and it can take a week or more to get your money! Better yet, with Bitwage, if you work for a company based in another country, you can set up recurring transfers at the same great rate.
Going abroad can be an enlightening and transformative experience. When doing so, however, remember to think of the financial implications. If you make the wrong moves, you might have to pay big. If you manage your finances correctly, your new move can be a prosperous one. Planning on making your big move? Check out Bitwage’s current exchange rates.
Photo via Frankie Leon