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Banks O Banks

May 21st, 2015 at 05:37 am

So, I went to my local bank branch today. It's a respectable branch, of a reputable bank. I'm a fairly distinguished client of the bank, and have recently added an additional business account (on top of my personal current account and saving account with them).

People there are nice. Polite is maybe a better way to phrase it. Their service, I must mention, is very client-oriented. They try to meet the standard that large retail stores have put in place.

In any case, I came there to test them. I wanted to see what I can help my saving with. Little they know that I don't trust banks to begin with, and being a financial entrepreneur, I'm quite familiar with the alternatives, and pursue my major investments, loans, and activities as far as I can from them.

So I started off with the current account. Reducing the fixed fees relating to activities relating to it. I didn't have to ask much and was offered 12 months w/ 75% discount on all of those. That's nice, I must admit, but if it's so easy for them to offer it, why wouldn't they approach me and tell me "hey fella, your bank account is large enough to offer you A B C", instead of me approaching them.

Then we went on with investments, and I reduced fees there at approximately 40%; my previous fees were far less than half of the initial offer from the bank. That means that with a medium sized account, no debt, good history, and assertive, knowledgeable approach, you can reduce 70% of the fees relating to investments, while most people won't even argue over them.

To top it off I was looking for some Foreign Exchange (NOT! I knew the outcome but had to test them). They offered a 0.2 commission structure, because "we've been working together for a while", plus a fixed fees translating to about 25 Dollar US, plus spreads that were over the 1.5% mark. So in total on my $10,000 transfer, they wanted to take off 195 Dollars in commission, and exchange my $9,805 into Euro. Kind offer gentlemen but with the companies I work with (

Pensions abroad

March 15th, 2015 at 04:57 am

Let me tell you about an email I got from a J. Doe (I didn't get a permission to republish this story so I'm careful with it). This guy has retired a few years back. Had a decent salary and was eligible for a nice pension at around 5.5K GBP per month.

His children moved to Germany, so him and his wife decided to follow their steps.

They bought a small house, and also brought a large sum of their wonga so they can help their children and spoil their grandchildren. John would transfer the whole sum of 5,550 Pounds a month from the UK to Germany, every month, for the past 2 years, as well as approximately 200,000 Pounds to purchase their current residence, and help their children financially .

All exchanged from British Pound to Euro, of course.


John reports paying what he calls an OK margin for the big transfer (asset purchase), and then paying just about 2% including fees on all other transfers.

He assumes he paid somewhere in the area of 5,000 Pounds in fees. He heard good things about FX companies, but didn't trust them, and ended up paying a lot more than he should have in commissions.

He encountered some of the articles I wrote in that regard, and is now glad to report he pays about half of what he used to pay with his bank, and that the service is good as banks or better.

Good to hear that, and glad to help J Doe Smile




The world of FX

March 12th, 2015 at 02:49 am

Got my first comment on my previous post, nice!

"I would like to know how you do it now. Particularly for small amounts... My father in law sends small checks to my husband for his birthday, too, and the entire thing is eaten up by a $25 fee just for cashing a foreign check." - Buendia.

So I would dive a little further into it. Pardon me for not giving the full in and out analysis of the Forex industry, but it's a rather complex topic and I'm limited in time. So I'm it post by post, so eventually this blog could serve as a source of knowledge.

Answer

- Cashing a foreign check is a big no-no, and as you said common fees are 25 Dollars in the states, and even higher fees in Europe.

- The way to transact funds without paying that ludicrous commission is via bank to bank transfer.

- Wait! banks charge approximately the same amount of money as they do for foreign checks in "transfer fees". On top of that, they will take a margin of 2-3% on the exchange rate, and you'll end up in the same situation.

- So how would one conduct bank to bank transfers internationally without paying fees nor commission?

Specialized FX companies at your service

The market is booming with companies that provide the same service as banks (transferring funds internationally) but we smaller or no fees, and much better exchange rates.

Which companies are recommended? Well I have inspected the market for quite some time now, and even work for a site that does exactly that.

I will speak about the characteristics of all companies on a latter stage here, but for now I can introduce Currencies direct (review available here - http://moneytransfercomparison.com/currencies-direct-review/). This is an example of a nop-notch company that can address your need Buendia.

The key elements are:

- you can send money from the UK, and from the US, to almost 100 different countries so I am assuming this will fit your requirements (if not, let me know).

- the min amount is low at $100.

- no fees applied.

- better margins than banks.

- intuitive platform, easy, phone support, you do it once with their escort and then you can do it yourself quickly.

How does Curreices Direct direct and other FX companies work?

Simply enough they create an account on your name. You get online access to it. you transfer funds to that account in your local currency via domestic transfer (which costs between nothing to a few dollars).

Once money is stored in your account, you can ship in short time spans to wherever you want.

There is a lot more to it and more advanced options but I wanted to address that inquiry. I hope it helped.


Me

March 11th, 2015 at 10:27 am

Welcome to my blog. My name is Matt. I want to help everyone with advice in regards to personal finance. My focus is on financial products you can find outside of bank.

If you do the following activities as per your bank's recommendation, and don't look sideways for better opportunities, you are not maxing out on your saving.

Here are a few examples of things you can do outside of banks:

- Borrowing money - besides Payday loan companies that have a different functionality than the bank loans people usually take, there are many other alternatives.

The focus of my blog will be on peer to peer lending which is a very sustainable option, and for some, will be preferable to bank loans.

Another topic I will focus on are grants, social lending, and crowd funding.

- Investing money - again I vote for Peer to Peer investing, that allows you to act as a bank (to some degree), and do what banks do with your money (after taking a big chunk of it) which is peer to peer investing.

Other means of investing I shall cover include private investment companies, equity investment, crowdsourcing investmens, and anything I can find OUTSIDE of banks that will have higher returns on your money and shall not feed the monster.

- Transferring money for remittance or business. There are plenty of FX firms that serve this purpose much better.

- Credit cards - there are credit card offer that are better than what banks can propose you.

- Bitcoin and alternative coin as mean of

a. investing
b. shopping
c. remittance transfer

This is only a selection of the topics I want to cover, and I have much to say about.

About me -

Matt, 31, PR Officer for a financial data website, an enthusiastic blogger, that hopes to participate in the senior Olympics, when he's old enough to do so.