One of the biggest challenges a freelancer faces in the early portion of his or her career is figuring out how to receive money without paying a high cost for the transfer. Most freelancers will have to pay taxes, fees to transfer money, and currency conversion costs. Those costs can be increased or decreased depending on political climate, and more variables. This brief guide will give some advice on avoiding high costs for money transfers.
Find a Good Bank
First, find a good bank that will offer a decent rate on international money transfers. Use this bank for your contractor payment account if you don’t want to switch your finances over entirely. Just having this outlet will help your freelancers tremendously, and that goes a long way for employee loyalty. A good freelancer is hard to find, so take care of your best ones and you’ll have a strong remote workforce.
Also, be aware your contractors may have a preference. Be prepared to work with these special cases. The contractor’s account may lack fees for wireless credit card processing, or may be directly linked to his or her account already. Being flexible can help save them money.
Convert Currency First
International transfers carry a high fee because they must move through multiple destinations throughout the world, says Charge.com. If you, as the employer, convert the currency before you pay the employee, you can save a bit on the transfer fees. The price you do pay, however, is whatever currency exchange rate the bank offers.
If you have remote employees who will work for you on a regular basis, create a recurring transfer for them and save! Some banks, such as Wells Fargo, encourage employers to utilize recurring transfers. Another alternative is the ACH transfer, which is a person to person payment.