Currencies question

[Diashen]

Hey, I’d like to hear your opinions on whats the best way to manage currencies being European and having USD as main shop currency.

Right now I have Stripe account connected with Payoneer and getting paid in USD (I just started). Yesterday I ordered USD card, but I am worried I will lose quite some money using card on shops/atms due currency fees. Would adding Payoneer EUR balance account be a smarter decision? So that when I get paid in USD on Stripe, the money would change its currency to EUR on the way? (i think thats how it works..) Thinking of the best way to save on fees. Any advice appreciated, thanks!

(Also what about Revolut? I really like the design)

 

[safeSEOboost]

Often expenses are in USD, so if you have USD income, keep a USD balance somewhere. This way you pay in USD when you pay for goods or services, avoiding to pay foreign exchange fees twice.

Then once in a while when you start to accumulate profit in USD, you can transfer it to your home currency.

This is just one example, but your case could be different. In general avoid foreign exchange fees as this is where they kill you.

 

[kingddb]

Hey, I’d like to hear your opinions on whats the best way to manage currencies being European and having USD as main shop currency.

Right now I have Stripe account connected with Payoneer and getting paid in USD (I just started). Yesterday I ordered USD card, but I am worried I will lose quite some money using card on shops/atms due currency fees. Would adding Payoneer EUR balance account be a smarter decision? So that when I get paid in USD on Stripe, the money would change its currency to EUR on the way? (i think thats how it works..) Thinking of the best way to save on fees. Any advice appreciated, thanks!

(Also what about Revolut? I really like the design)

Your theory sounds correct assuming both your stripe and payoneer accounts will hold balances respectively. As stripe would be usd for fees and payoneer for profit like @safeSEOboost stated. *Disclaimer: i have not used either of these services*

 

[safeSEOboost]

Your theory sounds correct assuming both your stripe and payoneer accounts will hold balances respectively. As stripe would be usd for fees and payoneer for profit like @safeSEOboost stated. *Disclaimer: i have not used either of these services*

Yes I just gave a general response. The key is to be able to keep a USD balance somewhere, this is the kind of setup you want. It depends on your location, here in the UK I have USD balance in UK at my bank, but check depending on your details. In paypal I have $ and £ balance, ...

 

[Diashen]

Often expenses are in USD, so if you have USD income, keep a USD balance somewhere. This way you pay in USD when you pay for goods or services, avoiding to pay foreign exchange fees twice.

Then once in a while when you start to accumulate profit in USD, you can transfer it to your home currency.

This is just one example, but your case could be different. In general avoid foreign exchange fees as this is where they kill you.

Thanks for the reply. Right now I use Paypal for Facebook ads and Lithuanian bank for Aliexpress products (both uses EU as main currency). I still wonder if its better to switch and start using the Payoneer USD card as its probably better for Facebook ads / Aliexpress products (when I start getting some profits in) or just go for EUR balance, as I am living in Europe and everyday expenses such as rent / food etc are all in Euros.

Is there any way to check how much % id lose when withdrawing Euros from USD balance card, or using Euros buying facebook ads / aliexpress products? I heard some people saying they lose ridiculous amounts when withdrawing Euros from Usd balances, maybe it had something to do with they location / banks.

 

[safeSEOboost]

Thanks for the reply. Right now I use Paypal for Facebook ads and Lithuanian bank for Aliexpress products (both uses EU as main currency). I still wonder if its better to switch and start using the Payoneer USD card as its probably better for Facebook ads / Aliexpress products (when I start getting some profits in) or just go for EUR balance, as I am living in Europe and everyday expenses such as rent / food etc are all in Euros.

Is there any way to check how much % id lose when withdrawing Euros from USD balance card, or using Euros buying facebook ads / aliexpress products? I heard some people saying they lose ridiculous amounts when withdrawing Euros from Usd balances, maybe it had something to do with they location / banks.

The best way is to try different methods and check the fees yourself. Use https://www.xe.com/ to check the real-time exchange rate, so you can calculate the foreign exchange fees. Every financial institution will have different fees. I even moved from one UK bank to another UK bank a few years ago, and the new bank has much lower fx fee (like 30% less).

So test different methods until you find what works best for you.

 

[Diashen]

Your theory sounds correct assuming both your stripe and payoneer accounts will hold balances respectively. As stripe would be usd for fees and payoneer for profit like @safeSEOboost stated. *Disclaimer: i have not used either of these services*

Thanks for the reply, but what I want to use profits for every day use (EUR) as well? Would it be worth spending USD? Also seems like payoneer takes little fee percentage too. As for example the item I sold for 10$, stripe took 59cents and payoneer 9cents

 

[Diashen]

The best way is to try different methods and check the fees yourself. Use https://www.xe.com/ to check the real-time exchange rate, so you can calculate the foreign exchange fees. Every financial institution will have different fees. I even moved from one UK bank to another UK bank a few years ago, and the new bank has much lower fx fee (like 30% less).

So test different methods until you find what works best for you.

I see, what % do you lose when making transaction using usd? Also do you just use different banks ATMs or how do you check percentages on different banks? Or does it matter what local bank card is connected with you payoneer account? Right now I am connected with SEB

 

[tubeboost]

You will lose/win anyway because of currency exchange rate volatility. Focus on your profit. Financial management is another task.

 

[Diashen]

You will lose/win anyway because of currency exchange rate volatility. Focus on your profit. Financial management is another task.

I see your point, just wondering if there are any obvious better choices but I guess not, probably will just stick with USD balance/card

 

[safeSEOboost]

Currency exchange rate volatility has nothing to do with that as you can win or lose from volatility. On the other hand bank fees can make a big cut in your profit (and you can only lose from it). ATM usually is where they fleece you with fees around 8-10%. Say you paid 5-7% when buying the goods you sell. So this is a 15% loss. Just an example. Typically fx loss is 10-15+% of your turnover.

 

[Diashen]

ATM usually is where they fleece you with fees around 8-10%..

Damn thats quite high, makes me wonder how much percentage id lose by converting from usd stripe to payoneer eur balance, as then there would be barely any withdrawal fees I imagine

Say you paid 5-7% when buying the goods you sell.

You mean 5-7% loss if I use EUR while buying products on aliexpress or? Because usually I increase product price only 2-3times

 

[safeSEOboost]

You mean 5-7% loss if I use EUR while buying products on aliexpress or? Because usually I increase product price only 2-3times

You pay in what? USD? from what? EUR? this is my understanding. If so it means you pay an fx fee at this stage which I assumed to be at 5-7%, maybe too high. If I use my bank I think the fee is 2-3%. Paypal is more like 5% (I would need to refresh my numbers).

So what I mean is if you are EUR, you pay Alibaba in USD. If you pay Alibaba in EUR they would make you pay even more in fx cost. Never let the merchant charge you in your local currency.

Anyway you look at it, there is always a fx fee when you deal with someone based in a different currency. Check it out. Of course sometimes you do not "see" the fee, you have to calculate it yourself.

 

[Diashen]

You pay in what? USD? from what? EUR? this is my understanding. If so it means you pay an fx fee at this stage which I assumed to be at 5-7%, maybe too high. If I use my bank I think the fee is 2-3%. Paypal is more like 5% (I would need to refresh my numbers).

So what I mean is if you are EUR, you pay Alibaba in USD. If you pay Alibaba in EUR they would make you pay even more in fx cost. Never let the merchant charge you in your local currency.

Anyway you look at it, there is always a fx fee when you deal with someone based in a different currency. Check it out. Of course sometimes you do not "see" the fee, you have to calculate it yourself.

I see. My latest 10usd product's actual price+shipping was 4.16usd and I spent 3.56eur on my local eur bank account, and it seems like 4.16usd = 3.53eur at the moment so thats a really low fx cost. Guess I would need to test with more expensive products

 

[safeSEOboost]

I see. My latest 10usd product's actual price+shipping was 4.16usd and I spent 3.56eur on my local eur bank account, and it seems like 4.16usd = 3.53eur at the moment so thats a really low fx cost. Guess I would need to test with more expensive products

A good bank should use a 2-3% fx charge like in your case (roughly). So if you buy goods in USD, then get paid in USD, and change back to EUR, this is a total fx cost of about 5% and it is nearly impossible to pay less.
On the other hand if you maintain a USD balance, then the fx cost related to the turnover going through that account is zero.

 

[plottsch]

One of my clients in Austria was having a problem with this.


UNCONVENTIONAL APPROACH:

Set up an account for him in the US--all money got sent to that account--he re-invested the money until he wanted everything back.

Then in an epic move I bought 200 iPhones (mostly bad ESN), and had them shipped to Vienna for him to resell.

Good times.