How To Wire Money
When you need to send money quickly, a wire transfer can be an excellent choice. It is a good option for transferring funds securely and in a guaranteed manner for tasks such as closing on a home purchase or sending emergency funds across the nation or abroad.
These days, there is no "wire" involved in wire transfers. The name was applied back in the days when the telegraph was the one and only choice in long distance money transfers.
Today, wire transfers are conducted electronically between banks, credit unions and wire transfer companies such as TransferWise or Western Union.
The "wire" is simply complete instructions regarding the banking and other pertinent information of both the sender and receiver of the funds. The money is transferred for a fee, which is typically paid in advance by the sender. Once the amount is paid, there's no going back. The transaction is finalized.
Choices In Wire Transfer Types
You can send money via wire transfer both internationally and to domestic destinations. The amount of time required and the fees vary.
While it can sometimes take just a few minutes for money to transfer, it is possible for it to take days. The amount of time needed depends greatly on the destination of the funds being sent.
The money must first go through a clearing system (e.g. Automated Clearing House or ACH).
Domestic wire transfers are usually completed very quickly, but international transfers can take a few days due to multiple processing systems.
How Much Does A Wire Transfer Cost?
It can be a bit costly to send money via wire transfer. This is especially true if you work with a bank. Typically, a bank will charge the sender a flat fee of about $25 for a domestic (US) transfer. International transfers can cost in excess of $40. Additionally, the recipient may also have to pay a fee of $5 - $10.
If you are wiring money internationally, you must also be aware of the currency exchange rate. Both the sending and receiving banks may pad the exchange rates, so it's wise to be cognizant of the actual rate of exchange before finalizing your arrangements.
If you are transferring money through Western Union, TransferWise or another non-bank wire service, rates and times depend upon a number of factors. Among them are:
- The transfer method (e.g. personal pickup or online)
- The payment options you choose
- The delivery options available
- The amount you wish to send
- The destination
Even with these variables, you are probably better off in terms of fees and exchange rate using a wire transfer service rather than with a bank. Western Union is the oldest wire service going, and it is quite dependable, professional and convenient.
Are Wire Transfers Safe?
A wire transfer is a very secure way to send money, but you must be very careful about the final OK. Once you have approved the transfer, you cannot rescind it.
This is why many con artists take advantage of wire transfers for a variety of nefarious schemes. For example, a con artist might convince you that you have won a contest of some sort but need to pay "fees" via wire transfer in order to receive your prize. If you approve the transfer, your money will be lost and you will have no recourse.
How To Transfer Money From Bank To Bank
With this type of transfer, you simply give your financial institution instructions regarding the name of the bank and recipient of the funds you wish to send. Typically, this is:
- American Banker's Association (ABA) number
- Account number of the recipient
- Amount of money to send
- Name of receiving bank
Note that the ABA number is also called the "routing" number. It is the number found in the lower left-hand corner of a check. SEE ALSO: Chase Bank Routing Numbers
This type of transfer requires that both parties involved hold accounts at the institutions involved (respectively).
Remember that you may be charged between $20 and $40 for a bank-to-bank transfer, and the recipient may have to pay, as well. Double-check your account balance and make sure to take any outstanding transactions into account before committing to this kind of transfer.
How Do You Complete The Process?
Bank-to-bank wire transfers are usually done in person with hard-copy documents, but sometimes it is possible to access the forms online and fax or scan them to your bank. Check with your financial institution's customer service for specific instructions.
Keep in mind that both the sender and the recipient must be able to present valid identification. Additionally, if you are sending a very large amount, your bank may want to double-check with you to be sure you are who you claim to be.
Once the entire transaction is complete, your bank will send you a confirmation email.
How To Send An International Wire Transfer
To send an international transfer, you must have the Bank Identifier Code (BIC) of the receiving bank. If you are transferring money in the European Union, you must have the International Bank Account Number (IBAN). It is wise to work closely with your own bank to make sure of getting the right codes and numbers and applying them correctly.
Your financial institution can help you obtain the right transfer forms. They can also help you navigate questions of exchange rates and dealing with communications in another language.
Remember to be certain you understand the current exchange rate. If you are unaware, you may end up paying a higher exchange rate. You may also accidentally send the wrong amount of money.
How To Send A Wire Transfer Through A Cash Office
Western Union is an example of a cash office that handles wire transfers. You can send and receive money through one of these services without a bank account. You must simply have funds available for transfer and proper ID. Likewise, your recipient must be able to properly identify him or herself and present the correct confirmation number in order to receive funds.
Western Union offices are conveniently located in a wide variety of stores and markets worldwide. Non-bank wire transfers can also be conducted online, by phone or in person. The fee may differ for each option.
No matter which option you choose, once you have provided all information required and submitted your funds, the company will provide you with a confirmation number. You will give this number to the recipient so that he or she can pick up the funds.
How To Transfer Money Online
Wire transfers are tried and true, but in the electronic age there are lots of other good choices. Here are a couple of options you may wish to explore:
- Look into Interact E-Transfer, which uses email to verify the identity of the recipient and gives the OK to send funds directly to the person's bank account.
- Transfer funds via Paypal or similar online financial service.
Both of these methods are a bit slower than wire transfer, but they are also quite a bit more convenient, and fees are significantly lower. For sending small amounts of money in non-emergency situations, these types of services may offer a better solution.
All-in-all a wire transfer is a good financial tool to use on occasions when you need to transfer money in a quick and secure manner. You will simply need to provide the sending financial institution with correct information about the receiving institution and individual or company receiving the funds. Once your fee is paid, your funds will be moved very rapidly. This can be an excellent alternative to sending a money order or writing a check.