How to pay for international school fees
Some of us have to work away from family – or to give our children the best start in life, send them to the best schools abroad. In most cases, non-residents or non-citizens will have to pay upfront for their tuition, as they are usually ineligible for government subsidies or loan schemes.
Whether you’re paying for traditional schools, boarding schools, or universities, there is a temptation to just put it on the credit card. However, this could cost you hundreds, if not thousands more in fees and currency conversion penalties.
The credit card hit
If your credit card has the credit limit, the easiest option would just to put it on the credit card and forget about it. But as we all know, credit cards attract interest. International tuition fees can sometimes hit the high five figures – even six figures – and even a modest amount of interest – around 17%p.a. can stack on quickly.
Not only that, but credit cards process international transactions that slug the consumer with unfavourable rates and “double dipping” in terms of fees. From the moment you hit “pay”, your credit card provider will charge you an international transaction fee, usually between 1-3% of the total amount. If you’re shelling out $50,000 for your child’s tuition, you’ll be paying $1,500 in fees which also attracts interest! Not only that, you may get the absolute highest buy rate while the recipient is given the lowest sell rate. You could also be charged an additional currency conversion fee! All this means your credit card will be charged much more than if you used an alternate method such as Currency Exchange. More on that later.
Bank transfers – no redeeming features
International bank fees may not punish you with extra interest like a credit card, but they’re not much better than using your plastic. An international bank transfer offered by a bank typically asks for the highest possible buy rate and deposits the funds in the target account at the lowest sell rate. You’ll also be charged an international currency conversion fee. Not only that, but it can also take up to five business days for the funds to hit the account.
International bank drafts – slow and hard to find
International bank drafts or international cashiers’ cheques are designed for large amounts and international payments. This makes them a choice for paying for international tuition. They are widely accepted around the world, charge lower fees than credit cards or bank transfers, and are quicker to deposit while being more secure. However, creating these drafts is time-consuming, are not widely supported by banks, and are hard to replace if lost or stolen.
The Currency Exchange difference
This is how you pay for international school fees by using a foreign exchange transfer provider like TorFX which can eliminate much of these headaches by charging zero transfer fees, increasing your purchasing power, and using forward contracts to help lock in the lowest rates so you gain maximum value. TorFX does not charge any transfer fees on international money transfers. Currency Exchange’s partner TorFX offer a Rate Improver Guarantee where they will match or better any quote more competitive than their own, as long as certain criteria are met. *
Being veteran foreign exchange brokers, TorFX also use forward contracts and other methods to ensure you gain the best value for your transfer. Forward contracts lock in a rate for up to two years, which can save you money if the currency you wish to convert strengthens over time relative to your home currency. TorFX can also implement stop loss or limit orders which can execute a trade when a currency falls below a certain level, or to limit losses if your currency is tipped to rise beyond a certain point.
All these combined with TorFX business and market intelligence means you can save significantly more compared with using credit cards, bank transfers, and international bank drafts. We give you the peace of mind that you won’t have to pay for the transfer until the order is completed. You aren’t locked into any contract either – you can modify or cancel your order at any time.
Best of all, you don’t need to make a minimum amount of transfers per year or be worried you’ll hit a transfer limit. TorFX facilitate all manner of international transactions; even buying foreign real estate. Best of all, opening an account with TorFX is free. We handle everything from conversion to settlement of the transfer.
To find out more how you can save with Currency Exchange’s Rate Improver Guarantee, click here.