Of the five million British expats around the world many continue to earn their income or pensions in sterling. This money, paid into sterling accounts, often needs to be transferred to other currencies.
These expatriates need to move money regularly and safely to their current home. Large currency brokers usually offer deals for regular payments and small installments can be transferred cheaply and easily. The advantages of using a broker over a bank is that it is often cheaper, especially for regular payments.
Pensioners have been especially affected by fluctuating exchange rates and the depreciation of sterling. “Worst-hit are pensioners in South Africa, New Zealand and Australia, who have seen the domestic value of their state pension in their new countries of residence slashed by market volatility,” Mark Bodega, marketing director at HiFX said to the Telegraph.
He calculated that a British pensioner on a monthly pension of £628 received an income of AUD$1,700 four years ago, but today he would receive only AUD$968 a month. With this in mind, pensioners who can’t afford to see any further reductions in the income need to consider one of the regular payment services offered by the many currency exchange brokers in the UK.
While using a broker is potentially cheaper than a bank, clients can also take advantage of the fluctuating currency rates. If you believe the current exchange rate is as favourable as it gets, then you can fix your transfer at this rate and ensure the same rate for months to come.
What can the banks offer?
High street banks are counteracting the idea that brokers represent the best value for money. Lloyds TSB International’s Director Nicholas Boys-Smith told the Telegraph, “For people with banking requirements in two different countries, it’s generally easiest and cheapest to use multi-currency accounts. This means expats can have a sterling current account to receive and make payments in the UK, as well as an account in the currency of their country of residence.”
Customers using multi-currency accounts can transfer money between currencies free of charge and transfers are made on the same day. “We’re now also seeing some people switching from foreign exchange brokers to use our services.”
However you do it, take precautions
Moving your money between countries can be worrying, especially in this digital age when it just seems to disappear into cyberspace. To help give yourself peace of mind, make sure your broker is, at the very least, authorized and regulated by the Financial Services Authority (FSA). Companies should safeguard clients’ money by using segregated accounts that are separate from the day-to-day accounts of the company.