Paying a bill in USA with AUD or GBP

bwatt72 on 27/12/2016 - 00:03

I have a few payments to pay a company in the usa and i have two options.

I can pay in pounds and my bank will hit me with a charge being overseas charge.
Not sure what that fee is maybe 2.99%.
Which does add up.

My other option is to transfer to one of australian accounts and pay with that which don't charge fee.

With current exchange rates which is better to pay with uk account and be hit with a fee or exchange to australia and pay that way.

Im not owe this till 5th jan but i know exchange rate usa to pounds has gone up a few times and keeps rising.which means i pay more pounds.

Wondered if its worth exchanging to australia and then be fee free.

Im not too hot on the exchange rates etc from place to place etc but just trying to make my money go further and also cut out any extra fees.

Thanks

Financial

Comments

  • bwatt72 on 27/12/2016 - 00:26

    So its pay from a uk bank account to usa abd be charged a fee for it being overseas transaction.

    Or transfer from uk bank account to au bank account which charges no overseas fees.

    But is it worth sending to my aud as by time i have moved money here and then paid the usa bill am i any better off?

  • blimpyboy on 31/12/2016 - 00:40

    Just making sure I understand:

    Option 1:
    * Pay from UK bank account in GBP
    * Auto converted to USD by UK bank (incurring 3% fee)
    or
    Option 2:
    * Pay from AU bank account in AUD
    * Auto convered to USD by AU bank (incurring no fee)

    Assuming I've understood correctly, I'd simply go Option 2. Why? Because it costs you less money today.

    Your speculations about future exchange rate fluctuations are nothing more than that: Speculations. GBP/USD rates could shift to your benefit/detriment, and so could AUD/USD rates. Unless you have a crystal ball, or have good rational reasons for maintaining quantity in a certain currency, I'd just focus on minimising fees.

    Oh and also, I'd check to see if your 3% fees and 0% fees are actually right. Banks like to hide their fees within the exchange rates themselves (e.g. 3% fees, but offering you an exchange rate which is 7% worse than normal). An easy way to check this is to ask your bank if you were to buy £100, how much would you need to spend in AUD/USD to obtain it, and then compare it to what you see as a reference site such as XE.com.

    • bwatt72 on 31/12/2016 - 01:02

      Thanks for the info ended up sending gbp to my aud account with no fees and just made payments,im pretty sure im slightly better off but who knows.
      I do know that i looked at the exchange rate back on the 5th dec said to myself still a month yet no rush and since then till today for same amount to be paid i would be paying 45 gbp more.
      Whatever the outcome the banks etc will have taken there share also lol.

Login or Join to leave a comment
Login Join