sending money . . .

[Mike Arman <armanmik@n-jcenter.com>]

For something unrelated to Audis (or tor**ns), this subject generated a
surprising number of direct responses - In the interests of efficiency, I'd
like to beg the list's indulgence and clarify things here instead of on a
one at a time individual basis. This is the LAST public message you should
see on this subject. Please contact me directly if I have not answered your
questions.

1. There are TWO (sometimes three) fees in currency conversion. The one
that kills you is _hidden_ as follows:

	You: "I wanna send 500 Pounds to Phil, what's the cost?"

	Bank: "The rate is .6000 Pounds to the Dollar, and our fee is $20."

The killer is the phrase "The rate is .6000 to the Dollar" - that is THEIR
rate, and is ALWAYS less than the actual exchange rate. When they tell you
that you'll get .6000, the actual rate is probably .6450 GBP per USD.

Result: at .6000, Phil gets GBP 300, it costs you $500, plus the $20 fee.

At .6450, Phil would get GBP 322.50 (About $37 more), cost to you is $500 +
$20.

The bank made the $20 fee they told you about, plus $37 more in discount
which they hid. Their total profit on your $500 transaction was $57, more
than 10%! 

That's a 7.5% discount, and is a SMALL discount for these transactions.

On transfers of $50,000, the hidden discount often exceeds $2,000!

The third fee (adding insult to injury) is that sometimes banks charge $20
or so to RECEIVE a wire transfer!

Worst rates - worst ways to send/exchange money due to high fees and steep
discounts:
	Western Union, Thomas Cook (etc.) kiosks, airport currency exchange booths.

Not quite as awful: Local banks (but still no bargain) - try to use a major
bank since the Last National Bank of Cowflop will go though the biggies
anyway and add their fees to the big bank's fees - Use Chase, Barclays,
other "big name banks" - and SHOP THE RATE and determine ALL CHARGES!!!!
(No guarantee that they will know what they're doing - I once had the VP of
a "name" bank call me about a client in Canada - "Mr. Arman, I need to call
so and so in Canada - how do I dial the number?")

Next best, use the Amex service - at least they have a clue about how to do
this.

Best way for small amounts (under $5,000 or so) is to use your Mastercard
or Visa card, assuming the person getting the money can accept this.
Plastic charges about 1/2 of 1% as the conversion discount and fee
combined, the recipient gets paid in their local currency, you get billed
in your local currency as much as three months later.

Amounts over $10,000 USD, contact me directly.

End of non-Audi content.

Name for the list - I don't care WHAT Dan calls it - it is my #1 bookmark!


Best Regards,

Mike Arman