This time last year the Australian dollar was sitting at over US80c. Fast forward to present day and the dollar has fallen significantly to just US71c.
The dropping dollar may be good news for the likes of economists, such as RBA Governor Glenn Stevens who said he wanted to see the dollar drop below US75c to achieve balanced growth. But it isn’t so great for those who plan to jetset overseas, shop from international websites or send money back home in the coming months.
While there’s not much you can do about the falling Aussie dollar, which btw is tipped to fall even lower to under US60c, there are some thrifty tactics you can adopt to get the biggest return on your Aussie coin:
Overseas jetsetters and shoppers: Lock in your rate early with a prepaid card
If you’re planning on shopping online or travelling overseas this silly season you could consider locking in your exchange rate now on a prepaid travel card. Check out this scenario to see how far your dollar could go by locking your exchange rate in early:
Say you are planning on jetsetting to the US in the New Year and wanted to take $6,000AUD worth of spending money with you. With the current exchange rate of US71c you would be able to load around $4,260 onto your prepaid card. By comparison if you left organising your travel money to the last minute and found the dollar had dropped to just US65c, you would only receive around $3,900. That’s potentially an extra $360 in your pocket, just by locking in your exchange rate early that you can use towards spending at the Bloomingdale’s sales.
Sending money back home: Choose an online currency exchange provider
Want to send your family back home some festive love this Christmas? Well, our advice is to look outside the big bank providers in Australia at currency exchange providers like World First and OzForex, as you’re likely to get more bang for your buck.
Don’t believe us? Check out the table below, which compares the cost of transferring $US10,000 with the big 4 banks compared with some of the top currency exchange providers in Australia:
|AUD||USD||$14,043||World First, 1-2 days||USD $10,000|
|AUD||USD||$14,051||TorFX, 1-2 days||USD $10,000|
|AUD||USD||$14,071||HiFX, 1-3 days||USD $10,000|
|AUD||USD||$14,071||OzForex, 1-2 days||USD $10,000|
|AUD||USD||$14,900||Big 4 average, up to 5 days||USD $10,000|
As you can see the best deal when we crunched the numbers was offered by World First costing you $14,043, compared to the average cost of transferring through a big 4 bank of $14,900 (a difference of $857).
If that isn’t incentive enough, the transfer period is generally much shorter with foreign exchange companies. For instance, World First has a transfer period of up to two days, compared to the big four banks who generally make you wait up to five days for the international money transfer to finally go through.
It’s important to note that the best price offered for international money transfers will vary depending on the amount you’re transferring and the currency you’re converting the cash into.
Compare today’s exchange rates
Mozo’s international money transfer comparison tool compares over 10 currencies from Australia’s leading foreign exchange providers. Rates are updated hourly, see here for today’s rates.