How to use a Wise account when living abroad

This article explains why a Wise account is highly convenient when living abroad. Wise, previously known as Transferwise, can be safely used to:

• Transfer money from the United States into your bank account abroad
• Getting paid (or receive money) in any currency
• Getting tax refunds from the IRS

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Transfer money with Wise

Can you use a bank to transfer money into your French bank account?

Sure, you can use a bank but conventional bank fees to convert any currency are really high. The reason is that conventional banks decide what exchange rate they are going to charge you for the conversion of your US$ into euros. You usually have no idea how many euros you will end up with before the transition is over. That is the reason why you’re better off using Wise, who specializes in international money transfers.

3 Reasons to use Wise to send money to France

I have used Wise multiple times in the past five years for amounts ranging from $1,000 to $100,000. I recommend Wise with confidence for the following reasons:

1. Best conversion rate – Wise uses the mid-market exchange rate with no mark-up.
2. Reliability – I have used Wise many times and things always run smoothly.
3. Speed – Transfers happen really fast once your account is setup.

I’ll explain in this article what the process is to transfer U.S. Dollars into your bank account in France using Wise.

What is the process to send money to France?

Transferring money from your bank in the United States to your bank in France is a two-step process.

1. Transfer money from your U.S. bank into your USD Wise account.
2. Wise converts your US$ to euros directly into your bank account in France.

Before doing anything else though, you need to create an online account with Wise.

Create a Wise account online

You can either create a Wise personal account or a Wise business account depending on your needs and your situation. Setting up a business account includes a fee and takes a little bit longer since Wise needs to verify your business.

Setting up an account with Wise usually takes two working days. Plan ahead and create your account here. 

When creating your Wise account, you need to get your identity verified and you have to upload a picture of yourself holding your ID. It is best to wait until your ID has been verified before initiating a transfer to not delay your transfer.

How much does a transfer with Wise cost?

Wise uses the real mid-market exchange rate to convert U.S. Dollars into euros, unlike banks who set up their own rate. Wise fees are calculated as a small fixed fee (currently $6.15) and a percentage of the amount you are sending (currently 0.43 %).

The price you pay also depends on how you send money into your Wise account. You can use a bank wire transfer, a bank debit (ACH), a debit card or a credit card. An ACH transfer is free or inexpensive but it can take as much as 2 to 3 working days to complete. A wire transfer on the other hand can be done almost immediately.

Use Wise’s calculator to check how much you will get in euros for your US$. If you send the funds via a wire transfer, your bank charges you the fees for an online domestic wire (between $10 and $35.00 depending on your bank).

The great thing about Wise is that you know what it is going to cost you upfront. There are no bad surprises.

Transfer money from your U.S. bank account into your Wise account

It’s a good idea to watch the USD to EUR exchange rate closely before initiating your transaction. That way you can get the best rate possible (assuming you are not in a hurry). There are plenty of sites that give you the exchange rate (Reuters is one of them). I personally use Google finance.

Once you are ready to transfer your money, set up your transfer and the rate is automatically locked in. Wise guarantees that you will get that rate, as long as they receive the total amount in a certain number of hours indicated on your transfer details. The time your rate is guaranteed is extended if it falls over the week-end. If Wise receives the money after the deadline, it will still convert and send it using the mid-market rate instead. I initiated the following transfer on a Saturday and Wise guaranteed my rate for 87 hours.

You can play with blocking rates and canceling them to block a better one later a few times. Be aware though that Wise will not allow you to do it after a while. In their own words: “We’ll limit the number of guaranteed rate transfers you can make if we notice you are setting up multiple ones to get the best rate.”

Transferring a larger amount of US$

If you are transferring a larger sum of money, check first with your bank in the United States. There is a limit to the amount you can send per day, or per transfer. This limit might differ if you are sending money online, over the phone, or in-branch. Your American bank might also require additional security verifications before sending the money.  Ask your bank how much money you can send at once before initiating a transfer. It is often quicker, and simpler, to set up larger transfers in-branch or over the phone rather than trying to do smaller amounts online and taking the risk to miss your guaranteed rate.

SEPA facilitates money exchange between banks in 36 countries (the ones from the European Union plus nine more). This regulation guarantees that euro payments are received within a guaranteed time, and banks are not allowed to make any deductions of the amount transferred.

Convert U.S. dollars from your Wise account directly into your French bank account

You have now sent your U.S. Dollars from your bank account in the United States into your Wise account. The next step is to convert your US$ to euros and send them into your bank account in France. This part is taken care of by Wise, once your money is received.

Wise has two European accounts, based in Estonia and Belgium and the euros that you receive come from one of these two European accounts. That is the reason why your French bank statement will show a money transfer from Europe, not from the United States.

Because of EU regulations, transfers between bank accounts in two different SEPA countries don’t cost more than a local transfer. This local transfer combined with the fact that Wise uses the real mid-market exchange rate  explains why Wise is always cheaper than using a conventional bank for international money transfers.

Learn some French today!

Check out my French Glossary of Money Transfer Terms

Use Wise multi-currency account

I am not only using Wise to transfer U.S. Dollars from my bank account in the United States, I am also using Wise to get paid.

A Wise multi-currency account lets you hold one account per currency you choose (Wise offers over 50 currencies!). I hold one account in USD and one in EUR. My clients can either wire US Dollars directly into my USD account or they can wire euros into my Wise account in EUR.

Transferring euros from your Wise EUR account into a French account is pretty much free and super fast. In my own experience, the money shows up in my account in a matter of seconds. When working with international clients, using a multi-currency account can save you a lot of headache.

With each Wise account you own, you get bank details. Your Wise account in USD can be used anytime someone asks you for a U.S. bank account information. You can use your Wise routing number and account to receive tax refunds or stimulus money from the American government.

A multi-currency account also gives you access to a debit card that you can use to pay for purchases in France. Another great advantage to consider is that you can use your debit card to pay your U.S. income taxes.

Can you let money sit in your Wise account?

From December 2020 to August 2022, Wise was charging monthly fees for holding over €3,000 in a Wise EUR account for more than 3 days. This is no longer the case and the fees have been removed.

Plan ahead for larger transfers

When planning to transfer a large sum of money into your French bank account, let your French banker know in advance. If you don’t, the bank might hold onto the money until you give proofs that the funds are legitimate. As I explain in Open a bank account in France as an American, maintaining a good relationship with your banker is very common (and useful) in France.

If you need to bring a large amount of money, try transferring it before you leave the United States. It is very possible that your U.S. bank local branch let you transfer it all at once. After you leave though, you have limits on how much you can send at once. It will cost you more, both in money and in amount of stress. I really wish I had known that before relocating to France after selling our home in California.

Is Wise a foreign bank account?

A Wise account that holds non-US$ is considered a foreign financial account for FBAR purposes. Remember to disclose your Wise foreign account if you have to file FBAR.

When you file French taxes, you also need to report Wise accounts that hold non-Euro currency.

I hope this article convinced you to take advantage of a Wise bank account when living abroad. Read Moving to France checklist to get ready for your move abroad.