If you’re an expat living in France or a second-home owner, you will probably need to exchange currency on a regular basis. Maybe you earn your income in Sterling but have French mortgage payments to make in Euros, or perhaps you need to transfer your foreign pension into Euros. Setting up a regular payment plan is the most convenient way to handle your international payments to France. Here’s what you need to know.
Making International Payments to France
Making regular international payments to France can often come with excessive transfer fees and hidden charges, not to mention the effects of currency exchange rate fluctuations. When you’re making monthly mortgage payments or living off an overseas income or pension, these fees can quickly add up, and changing rates can mean you never know exactly how much you’re going to have to pay each month.
Setting up a regular payment plan with a currency exchange specialist takes all the hassle out of organising your monthly transfers, as well as offering peace of mind. You can set up a standing order to transfer money into your French bank account to cover utility bills and property taxes, or pay your mortgage repayments directly. If you need to make any changes, you can adjust dates and transfer amounts online.
For less frequent payments, you can save the recipient’s details. When you’re ready to make a transfer, simply go online and set up the payment.
Opting for a long-term payment plan also mean a reduction in transfer fees or lower fixed fees. You could even benefit from free transfers for life thanks to FrenchEntrée’s exclusive offer with Moneycorp (more about that in a minute!). When you consider that some high-street banks in the UK charge up to £40 and international wire transfers from the US can incur fees of $45 per transaction, this is no small saving!
Fixing the Exchange Rate
Another challenge with making regular international payments to France is that you will always be at the mercy of the exchange rates. This might mean some months you get a welcome bump in your pension funds, while other months you’re left short. Either way, it can be worrying, especially in times of economic uncertainty, as many UK expats experienced after Brexit. It’s also difficult to plan your finances when you never know exactly how much income you will be receiving each month or how much your bills will be.
To protect against this, there are three options available:
You can fix your domestic currency amount. This way you will know exactly how much £, US$, AU$, or other currency will be leaving your account with each payment. How many Euros you get for your transaction will depend on the currency rate at the time of transfer.
You can fix the Euro amount. This means you will know exactly how many Euros will be arriving in your French account each time. How much you pay for your transaction will depend on the currency rate at the time of transfer.
You can fix both with a forward contract. This means you will fix the exchange rate on your regular payment plan. When the exchange rate is at a level you are happy with, put down a deposit to lock in this exchange rate for up to two years. That way you know exactly how much you will pay in your domestic currency and how much you will receive in Euros.
Transferring Foreign Income and Pensions into France
If you are making transfers of an overseas pension, rental income or other revenue into your France bank account, you have two main options available to you. If you are living off your income or pension, the best option will likely be to set up a regular payment plan as outlined above.
However, if you have greater flexibility over when you transfer your money, a smart move could be to set up a rate tracking system or market order. This means that you schedule your transfers into Euros only when the exchange rate reaches your desired value, ensuring you always benefit from the best rates.
Ready to Send Money to France?
Whether you’re searching for your dream French property or planning a move to France, it’s never too early to start thinking about currency exchange. Read our Beginner’s Guide to Currency Exchange, visit our Currency Zone for the latest news and currency reports, and use our French Currency Exchange checklist to ensure you are fully prepared for your French property purchase.
FrenchEntrée’s trusted partners at Moneycorp have more than 40 years’ experience helping customers get the best value on their international transfers. Best of all, if you sign up through FrenchEntrée, you can benefit from our exclusive offer including free international money transfers for life.
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