Whether you require to send money abroad to a relative in Australia, pay for a house purchase in the U.S, or remit salary to your overseas employee in India, there’s a cheaper way to handle this than wiring the funds through your bank.

Most Canadians aren’t quite aware of that, but there are companies which grant you access to foreign currencies for a fraction of the cost it would cost you at a bank. These are serious companies which adhere to strict regulators, and move billions of dollars each year. Traditionally, these companies have been used by small internationally-trading businesses, but in recent years, more and more private clients are changing the way they transfer money internationally.

What does a transfer even cost?

The reason why these companies have been predominantly used by businesses is the fact businesses tend to understand costs at a higher level than individuals. Most people don’t realize that transferring $100,000 to your U.S bank account (CAD to USD) could cost you as much as $2,500!

Let me break down the costs for you.

Wire costs (which  banks happily advertise): $10 to $40 per transfer. Doesn’t seem like much for a substantial money transfer.

Commission (which banks happily advertise): 0%. Most modern banks and exchange bureaus promote themselves as being 0% commission.

Margins (the difference between what it costs banks to buy a certain currency and for how much they sell it): 1-3%, and could be higher if you are exchanging your CAD to an exotic currency.

So it all boils down the exchange rates offered at any given time. If they are 2.5% worse than the real rate (the one you see on the newspaper, or on Google) it means you’re paying your bank 2.5% of the lump sum you are transferring to a bank account abroad. Plain and simple.

Howcome a simple action costs so much?

Banks will come up with all sort of excuses for this question. “We have to hedge ourselves against risks, we we take a wide margin to stay on the safe side”, they often claim. Baloney, I say. They take as much money as they can because their clients are unsuspecting. Most people don’t even know that the Buy/Sell rates offered by banks are not the real rates in which banks buy currency for. Like with plenty of other cases, banks like to abuse their power and public trust, and they do so very well.

What’s the alternative?

There are hundreds of Canadian-facing companies from across the global that offer foreign currency transfers for better rates than banks. If you have been keeping up to date with the money markets you might have heard of Transferwise, for instance, a British Startup which has just launched its “borderless bank account” in Canada (literally hours before writing this post).

Reading about various companies and their offering could be quite tedious, though. A lot of the companies are very samey in nature, and it’s hard to pinpoint the differences. They often overcomplicate their websites just to keep a competitive advantage so they not fully reveal their offering, rates and accessibility to currencies.

MoneyTransferComparison.com does all the heavy lifting in that sense. It reviews dozens of different companies and aggregates all the information you could find about them online. The best part? All its top recommendations are companies which accept clients from Canada and can transfer from abroad to Canada! Although the site is serving mostly Brits (where this industry is most popular at), it sticks to the largest and most reputable services… and these multi-million dollar companies all have offices in North America!, and bank accounts in the US and Canada.

I hope you learned a thing or two about international money transfers and how to save a few dollars if you need to send money abroad.

Do you remember a time when you needed to go to the bank just about every week to cash your paycheck and to withdraw money?

With the advent of digital banking, the world has changed, and for all of us, it has gotten so much more convenient! The money that is ours is virtually always available, and it has never been easier for you to get things done! Don’t believe us? Look at some of these changes.
Digital Point of Sale Machines
Instead of simply sticking with cash and checks, vendors large and small can now take their wares on the road while meeting credit card demands. Devices like the Square turn your smartphone into a single-step card-taker, and this can change the way you do business.

Banking Apps
Do you want to check your balance? Do you want to make sure that your money is exactly where it needs to be? That is what a banking app is for. Suddenly, everything you can do at the bank is available to you except for getting out actual money!

Quick Account Transfers
There was a time when it could take as long as twenty four hours to make changes to your account. That could make things a little dicey if you had rent to pay and you needed to get your money from one account to another. At the time, it was easy to get annoyed because, after all, that was all your money! Now you can move money from one account to another without a single bit of trouble and with a bare second’s worth of delay!

Better Business Opportunities
For a long time, the only people who could do business were those who were willing to go through exhaustive processes with banks. Now, instead you can simply set up a merchant account with a service like Paypal and be ready to go. Services like this allow people to pay you with no risk whatsoever to yourself, and they make a huge difference for small business owners everywhere.

Instant Payment
If you are a freelancer or if you simply sell goods or services through the mail, you may remember how long you might go between paychecks. Things could get lost in the mail or people would tell you that they were. With instant pay services available everywhere, you can see the money in your account in a very short amount of time!

Invest Yourself!
With the advent of the digital banking revolution, you have also been placed in control of your own investing. Through the use of direct investing, you can invest your money through a digital interface, making all of your own decisions and deciding on what you are going to do with your cash.

Digital banking equals independence, so figure out what you might not have been doing and join in!

With the start of the global recession at the end of 2008 as the world markets collapsed, millions of Canadian families came face-to-face with severe financial distress. Most of this distress was caused by debt and in particular, too much unsecured debt from overspending on credit cards. Even now four years later, the average Canadian family owes $1.54 for every dollar of income they bring into the household. As a result, families in Canada continue to struggle to reduce debt in order to regain financial control.

All of this financial hardship caused by debt may make it seem like debt is the enemy of a stable financial outlook, but in a real sense not all debt is bad debt. In fact, the way the credit and credit reporting systems are set up in Canada, you are almost required as a consumer to take on at least some debt in order to be financially successful. Otherwise, you have no credit rating. This can lead to difficulties with everything from making big-ticket purchases to renting an apartment or getting a rental car on your next vacation.
So if not all debt is bad debt, the topical debt management question is how can you tell which types of debt are good? What’s more, how do you protect yourself so you can avoid problems that arise when you have too much debt?

Often times, debts are good debts because holding debts of these type can actually have a positive impact on your credit scores. Debts like your mortgage and your auto loan are counted as positive factors on your credit history when lenders, creditors and other businesses run a check your credit. This is why the types of debt you carry actually account for 10 per cent of standard FICO credit score calculations. Holding debts like a mortgage and a car loan can mean you enjoy higher credit scores.

By contrast, debts like department store credit cards and specialty store credit cards are considered bad debts, because of the extremely high interest rates and strict terms of repayment that most cards of this type carry. Since these debts don’t look as good to creditors, carrying large amounts of debt on cards like these has the potential to hurt your credit scores. Any business that reviews credit reports would view these kinds of debts as a sign of an increased risk consumer who may not be as responsible paying off the debt.

Another important factor in separating good debt from bad debt is the amount of debt you hold. For instance, a mortgage is a good debt in general, but if you have a bad mortgage with terms that don’t work for your budget or you purchase a home that’s beyond your means, you can end up in a bad situation with debt even though a mortgage is a good type of debt to hold.

The same can be true with credit card debt. Credit cards from major credit card issuers in Canada are better to have than specialty store credit cards. However, if you are carrying too much credit card debt even if it’s with a major card issuer, it’s almost always going to mean you are considered a high-risk borrower.

No matter which types of debts you carry, you should never allow the total monthly payments on your debts to exceed 36 per cent of your monthly income. More debt than 36 per cent usually means that you are verging on financial hardship, because your debt payments are going to start reaching a point where you are struggling to keep up. If you have more than 36 per cent of your income being used on debt payments, you need to develop a strategy to reduce your debt burden quickly or look into options for debt relief.