Article written by Peter Lavelle at foreign exchange broker Pure FX, a trading name of Foreign Currency Direct Plc
Exchange money can be a complicated business, so if you’re looking for help, this is the right article for you.
Are you moving abroad? If this is the case, you might be studying in Barcelona, or interning in Berlin. At Uniplaces we have you covered. We have rooms and apartments to rent, for all tastes and budgets, in more than 30 European cities.
Wherever you’re studying, you’ll have lots to do before you catch your flight, to your new home away from home. This could mean finding out more about your course at your foreign university, packing your things, and saying goodbye to your friends and family.
Of course, in addition, this might also include obtaining foreign currency. How will you transfer money while you’re studying abroad, and how can you increase your foreign exchange rate, to help make sure you make the most of your budget? Well, find below five top tips.
1. Plan Your Foreign Currency Needs in Advance
The first tip to boost your currency total when you move abroad with Uniplaces is to think about your foreign exchange requirements. For example, will you need to pay the university fees while you’re studying abroad in another currency? In addition, are you going to be studying abroad for an extended period, say over six months or a year?
If this is the case, it might be worth you or your parents setting up a bank account in the country where you’ll be studying. This will enable you to more easily pay your foreign university fees, and give you easy access to the foreign currency you’ll be using on a daily basis.
However, on the other hand, if you’ll be studying abroad for only a short term, you might be happy to exchange currencies now and again, at a bureau de change.
Depending on your foreign exchange requirements while you’re studying abroad, the ways to increase your currency total will be different. In this article, we’ll look at both how to lift your currency total when you’re transferring abroad a larger sum, as well as ready cash.
2. Buy Your Cash in Currency Before You Go, Not at The Airport
If you’re going to study abroad for just a short term, or if you’d like some ready cash for when you arrive in your destination country, you’ll use a bureau de change. However, it’s important to note, don’t exchange currencies at the airport when you’re about to catch your flight. This is because the bureaux de change there know very well that you’ve left buying your currency to the last minute. You’re a captive audience at the airport, so they offer inferior exchange rates. In brief, you’ll receive a lower foreign currency total than if you’d planned ahead.
Instead, to increase your foreign currency total for your ready cash, compare the exchange rates online. For example, if you’re in the UK and about to study abroad, Travel Money Max is an excellent website to see who’s offering a competitive exchange rate. Of course, remember that if you choose to have your foreign currency delivered, you’ll need to do this at least a few days before you go.
3. Compare The Exchange Rates Offered by Your Bank Before You Transfer Money
Meanwhile, if you need to pay the fees for your university abroad in a foreign currency, and you’ll be living abroad for a while, you might choose to open a foreign bank account. If this is the case, you’ll probably be transferring a significant sum from your domestic bank account abroad, say for example over £5,000 or currency equivalent.
If this is the case, your instinct might be to transfer your money with your local bank. After all, it’s very likely that you use your local bank for your other financial dealings. You’ll know them and you trust them.
However, it’s important to bear in mind that the banks often take advantage of their privileged position, and offer inferior exchange rates. When you’re transferring a significant sum, this exchange rate can make a big difference to the currency total you receive, often hundreds or thousands.
So before you transfer your money, compare the exchange rates with those offered by a dedicated money transfer company. You might find that you can save money, which you can then use to either pay your university fees, or to enjoy your life abroad.
4. Keep An Eye on The Foreign Exchange Rates And What’s Affecting Them
It goes without saying that, when you transfer money abroad, you want as good an exchange rate as you can get. So how can you find out what’s happening to the exchange rates, and what’s influencing them recently, to decide when to buy your currency? Well, if you’re in the UK and about to study abroad, an excellent website is Pound Sterling Forecast.
Here, you’ll find exchange rate charts for the British pound sterling versus all the major international currencies, including the euro, US dollar or Swiss franc. You’ll also find information on what’s affecting the exchange rate recently. So you’ll be able to see if the exchange rate is strong compared to the past, and decide if it’s a good time to transfer your money.
5. Be Reasonable About The Exchange Rate You Expect, and Don’t Get Greedy
Last of all, it’s important to be realistic about the exchange rate you want, and don’t wish for the moon. For example, if you’re a Spaniard about to study at Bath University in the UK, you might look at today’s euro to pound exchange rate, and see that it’s 0.89. If this is the case, it might be unreasonable to want to exchange currencies at 1.10. After all, this would lift the euro above parity with the pound, which has never happened.
What’s more, another risk of waiting for an unrealistic exchange rate to arise is that, while you’re waiting, the exchange rate can actually weaken. So while you’re waiting for 1.10, the euro might fall versus the pound to 0.85.
This is because the foreign exchange markets are frequently volatile. Both the euro and pound are strongly influenced by the UK and Eurozone’s economic and political outlooks.
Instead, a useful way to think about the exchange rate you want to achieve, is whether it gives you the foreign currency total you need. For example, if you’re paying your foreign university fees, then the exchange rate that covers your costs is the exchange rate to target. This will save you unnecessary disappointment.
To conclude then, with these tips in mind, your foreign currency will be one less thing to worry about when you study abroad. So you can look forward to enjoying your new place with Uniplaces, exploring your new country of residence, and getting top marks in your course!
By Peter Lavelle at foreign exchange broker Pure FX, a trading name of Foreign Currency Direct Plc