The currency of the country where I live in (Belgium) is €. I mainly need euro’s to pay for household and other stuff.

At the other hand some of my projects are international and I am getting paid in dollars ($$$$). Some of those dollars can be used directly to pay for business costs (hosting, paid ads, … ) but a big portion of the net profit needs to be exchanged to euro’s so I can buy food, electricity, …

Some of my business partners pay me out through Paypal, other are doing a transfer directly to a (USD) bank account number (through Transferwise).

Your scenario might be the inverse or similar, so you can translate it to your situation.

CHALLENGE: how to transform my well earned dollars (received through PayPal and TransferWise) into spendable euro’s in a way I am not spending too much on fees.
Note: Typically there are transaction fees (sending money from one place to another) and exchange fees (when we do a currency conversion).

Some things to know before we start:

  • If you are having PayPal and want to do a conversion (in my case dollar to euro, be prepared to pay quite some fees ( transactions, exchange rate, …) compared to other alternatives: TransferWise, Revolut (see further).
  • In PayPal you can have multiple currencies. But it seems you only can do a wire transfer (meaning a cheap way to transfer money) to a bank account of the ‘main’ currency of your PayPal account (I think that’s based on your official address).
    So in my case I can only attach bank accounts supporting IBAN (mostly Europe). So I can not (cheaply) send dollars to another dollar account outside my PayPal.
  • TransferWise has a unique feature: it provides you with several “endpoints” to receive money.
    So I have a USD “endpoint” with two types of bank numbers: one to receive “wire transfer” (faster with a fixed fee per receival of money to it) and another to receive ACH payments (slow but no fees)
    I also have a EUR “endpoint”: I get a “personalized” SEPA / IBAN number.
  • There is a quick way of getting money from TransferWise to Revolut by attaching the TransferWise debit card to your Revolut app.

So now we know all of this and based on exchange rates, it seems the preferred situation is to get the money in Revolut.

If the money is in Transferwise that’s not a big problem as of the possibility to attach the Transferwise card to Revolut.

The challenge is when the USD money is in Paypal. The scenario Paypal “pushes” me in would be to do the “dollar to euro exchange” in Paypal and send the € to my bank account. But as you see the currency conversion over there is pretty expensive.

Time to reveal my preferred solution 😉
So I send my PayPal dollars to a friend who has a PayPal account where $ is his/her main currency. He/she can easily get away with the dollars (or spend it directly using PayPal or transfer to his own USD account). He/she will send the $ amount to my TransferWise USD account. Depending on which type transfer he/she used (wire transfer or ACH payment) there will be a small or no fee.
The moment it is in TransferWise I can easily get it into Revolut where I can
a) do currency conversion (using cheap spot interbank rate FX exchange)
b) spend it: or directly using the Revolut Credit card or transfer it to my personal € bank account.

APPENDIX COMPARISON OF EXCHANGE RATES

Below you see what how many euro’s I would get for $ 1000.

Paypal
To check what we are getting for Paypal, log into your Paypal and click this url
https://www.paypal.com/businesswallet/convertcurrency/USD/EUR

Revolut
Go to your account for the currency you want to get rid of , click on sell:
Revolut uses on spot exchange rates (during specific time windows, basically when the markets are open).

Transferwise
Go to one of your currency balances (in my case USD) and click the convert button to see how much we are getting.

So Revolut seems to be the cheapest option. Note: if you are having the basis/free version of Revolut, there is a monthly limit of the amount of money you can exchange.

This article has helped some friends / colleagues save money 😉