There are many reasons why you might need to send some of your income back home while teaching English abroad, including to pay off student loans, to cover a mortgage on a house or apartment, or to simply help your family. Whatever your reasons, you might find it is not always straightforward as there are a few things to take into account, such as transfer fees, exchange rates, and the time it takes to process the transaction.
What are the pros and cons of using a local bank?
Depending on where you are teaching, a local bank might be a safe and reliable option. In well developed countries that have a large market for foreign teachers, such as Japan or South Korea, banks can often be a good choice as their transfer fees are usually quite low and it only takes one or two days for the transaction to go through. In contrast, banks in less developed countries can often charge higher rates, be less efficient and the whole process can sometimes be overly complicated. Using a bank can be even more difficult if your salary is paid in cash and you do not have a bank account in the country where you are working. A scenario that is common when teaching in Latin America or Europe.
If you do use a bank for money transfers it is important to remember that they typically charge per transaction rather than by amount. In this case it is obviously sensible to send larger amounts less often, instead of regular small amounts.
What are the pros and cons of using Xoom?
Xoom is a popular platform that is operated by PayPal, a long established and trusted service provider. Xoom operates in 57 countries across the world and provides transfers from bank accounts and credit/debit cards. Its transfer service is particularly fast and the recipient is able to collect the money from a wide range of locations, such as banks and retail stores. The main negative of this option is it can be affected by local banking hours and national holidays etc. It also charges relatively high fees and has a maximum transfer limit of $2,999.
What are the pros and cons of using OFX?
OFX currently operates in 91 countries worldwide and is a popular option as it doesn’t charge any fees for its transfer services. It is also known to offer favourable exchange rates and even allows you to set your transaction to go through once a certain exchange rate has been reached. On the downside, a bank account is necessary at both ends of the transaction and it can take three or four working days to complete the process. OFX also has a minimum transfer amount of $150.
What are the pros and cons of using Western Union?
Western Union has over 500,000 outlets and operates in over 200 countries throughout the world, making it the largest money transfer/cash pickup provider out there. Transfers can be made from a bank account or credit/debit card by using their online or mobile platforms. The recipient of the transfer is able to pick up the cash on the same day you deposit the money if the initial transaction is also made in cash. However, if you use their bank to bank service the transfer can take as much as five working days to process. With this option, if you choose a fast transfer it will generally come with a higher fee.
What are the pros and cons of using MoneyGram?
MoneyGram is also a massive company that has in excess of 350,000 outlets in over 200 countries. Cash transfers are processed in a matter of minutes, while other online transactions can clear in just a few hours. With this service there is a maximum transfer limit of $2,999 and the fees charged can be relatively high.
What are the pros and cons of using TransferWise?
TransferWise operates via an easy to use online and mobile platform that can be linked to an email or facebook account. This option operates in 58 countries and there are no mark-ups on exchange rates. As there is no specified upper limit per transaction, this is a good choice if you need to send a large sum in one transfer. In order to use this service you will need to have access to a bank account at both ends and transfers can take up to a week to go through.
So, which is the best option for me?
It should be clear by now that there is no one best option that suits all people and every situation. In order to find the right method for you it is necessary to consider how much you plan to send, the frequency of future transfers, how fast the transfer needs to be, and whether you will be using a bank account, credit card, or cash etc. One thing that is true of all the options available is if you need the transfer to go through within a day or two, the transaction will include a higher fee than those that take several days to clear.
The information provided is presented as a rough guide of the most common options used by TESOL teachers around the world. Before sending any money back home you should conduct your own research before choosing the right provider to suit your own situation.