2022 November UPDATE: Revolut changed their pricing structure in July 2022 to no longer offer 1 free international transfer per month. Revolut (Premium)+Wise combo continues to be the cheapest way to move money from the US -> Europe. However, on the return side Europe -> US I now use Atlantic Money. see the details at the new blog post here: https://theaspiringadult.com/blog/transfer-money-with-atlantic-money. The below blog has been updated to strike out the Europe->US transfers information as it is now much more expensive.
Why is the bank<->bank so expensive??
There are two factors at play in money movements:
Get your accounts setup first
Target Audience Note 1: this blog is written for people that have residence in an EU country that is a) in the SEPA region and b) eligible to open both a Wise and Revolut account. It is important that you have a local EU identification document and local EU address for this to work. There may be other ways to setup and I'd love to hear from people in the comments!
Target Audience Note 2: if you are sending less than EUR €1,000 per month then this setup is unnecessary for you. It's probably cheaper for you to use Wise without the Revolut layer, and pay the transfer fees on each transfer. This is your approximate breakeven point.
Ok LET'S GO!: The strategy here is to use multiple institutions, leveraging each institution for something that they offer for FREE! This means you are opening accounts with institutions that make their money in other ways and using the parts that you need for free.
2022 July UPDATE: the below graphic is out of date as Revolut no longer offers 1 free / mth SEPA->ACH transfer. See the blog linked above for using Atlantic Money to move money from EU->US.
For this to work, you will have 4 accounts at the end. We use ING in Germany and Charles Schwab in the US as examples which can you swap out for your preferred local banks.
Case Study: Saving $$$ EU->US movements
[2022 July UPDATE: the below section is out of date as Revolut no longer offers 1 free / mth SEPA->ACH transfer. The savings achieved with this setup are fully gone and we no longer recommend Revolut for EU->US transfers. We have left the content in italics in case someone from Revolut sees this and gets our 1 free transfer re-instated!
Facts of our example: each month you wish to send EUR €5,000 a month to the US as USD for your savings accounts. These transfers are easy and won't use Wise at all! Only Revolut:
Case Study: Saving $$$ US->EU movements
Facts of our example: this is where things get tricky and where Wise comes in only for the first transfer, not for forex. You want to send USD $10,000 a month to Germany and exchange to EUR into your local German bank account.
Notes from readers
This is not financial advice, no predicted outcomes discussed in this blog can be guaranteed. This blog is for entertainment purposes only to illustrate how Wise is not always the cheapest option. The value of using Revolut grows the larger the amounts are you are transferring. Products are mentioned for illustration purposes only and are based on my personal experiences as a migrant living and traveling in Europe and the United States. The complexity of filing your United States FBAR each year may increase as you have a lot of accounts with in/out and sometimes you have to report multiple accounts for Wise (one for each IBAN/account number). Talk to your tax adviser. This blog was current as of 7 June 2021 and may be out of date by the time you read it. Nothing in this post is sponsored and I have no connection to any businesses mentioned here. Did you find any mistakes or has anything changed since I posted? Please get in touch with me and I will update it! Do you disagree with my assessment? Let’s have a virtual coffee and debate it!
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Unfinished human, currently v.5.0. Expecting at least 10 more versions. Aspiring adult.