How to Get The Best Exchange Rate When You Exchange Euros for Kroner
By Peter Lavelle
Do you intend to relocate to Norway? Then, before you go, one of the most important things to do will be changing your euros into kroner, to get the best exchange rate. So how do you get the best rate? That’s what I want to look at in this post.
1. Compare the rates available from your bank with those from a foreign exchange broker.
Before you change your euros into kroner, it’s vital to compare the rates you’re provided. For instance, while your first port of call may be your bank, a foreign exchange broker can offer rates up to 4.0% better. On a large transfer, such as when you’re buying a house for instance, this can therefore add thousands to your kroner total.
2. Look at the exchange rate in advance.
Once you’ve made the decision to move to Norway, it’s also important to look at the exchange rates in advance. This is because, if you want to change euros into kroner, the more time you give yourself to examine the rates, the bigger the total you’ll end up with.
Imagine for instance, that you research the kroner exchange rate just a week before you need the money in Norway. If you do this, you’ve given yourself no time to compare the rate to how it’s been in the past, and can’t wait to see if it improves. If on the other hand you give yourself six months, that’s lots of time for the rates to improve.
3. Use a properly regulated foreign exchange broker.
If you’re relocating to Norway from the Eurozone, ensure that the foreign exchange broker you use to transfer your funds is properly regulated. This means looking to see that they’re directly authorised by the Financial Services Authority. If they are, this means the dealer will maintain their clients funds in designated accounts, which are absolutely safe.
If on the other hand, the broker is only registered with the FSA, you should be careful. This is because, while being registered means this company is a financial services provider, it’s not necessarily adhering to the same security standards. You may have heard of Crown Currency for instance, which collapsed in 2010, in part because it was only registered.
4. Consider a forward contract.
Last but not least, you should also consider a forward contract. This is when, instead of transferring your money to Norway there and then, you lock in the present exchange rate, with the option to make the transfer any time you like in the next two years. The advantage is that you get to take advantage of the current favourable rate, but keep your money where you want it.
About the Author
Peter Lavelle is an economist at foreign exchange broker Pure FX. This Expat moved from London to Madrid at the start of 2012, and so has both personal and professional experience of transferring money abroad. He is currently learning Spanish!