Robert Mitchell provided this useful information 8 years, 10 months ago:

How to save money while paying your Euro bills - The Final Solution by rmitchell248 and JOFTAA


  • There is new, updated info, available here.
  • The info below in the second post is still current.




For the past couple years JOFTAA and I have been running through the best avenues available to save as much money as possible while paying our Euro bills while in Germany. This also includes converting U.S. Dollars into Euro for rent, utilities, spending money, etc.

We have tested many methods, from using the automatic payment service available from Service Credit Union (SCU) or Community Bank (CB), to opening a German bank account and funding that account using a USAA and/or Capital One ATM card at a German ATM.

While we were able to save money at first with USAA Bank since they waived the ISA (International Service Assessment) fee while on active duty, the waiver of this fee is only available for 1 year and only for Active Duty that holds an account balance before PCSing overseas. After that, USAA accounts levy a 1% ISA for transactions at non-U.S. ATM locations. Although Capital One does not charge this 1% ISA fee, their $600.00 daily ATM Limit has been a hindrance while attempting to pay 2,000-3000€ a month in bills, because getting this much Euro requires a trip to the German bank ATM every day for up to a week. While this method will work, it is not at all convenient. And, because you are going to the bank many times over several days, your Dollar to Euro exchange rate will change every day making it more difficult to calculate your savings against the DoD exchange rate.

These issues lead us to the next solution, and what will be our final solution, for paying our Euro bills in Germany unless SCU changes their policies. Please keep in mind that the DoD pays us 2.5% higher than the current Euro to U.S. Dollar exchange rate in our paychecks. SCU and Community in turn charge us 2.5% more for the Euro that they sell us on base than the current market rate. The whole idea behind what we are telling you is to keep this 2.5% for yourselves and not give it to SCU or Community Bank. While 2.5% doesn’t sound like a lot, it really adds up fast!


If you were to withdraw 2,500€ a month for your bills and another 500€ a month for spending money (not including any vacations or heavier than usual Euro spending) the savings are great.

Let’s say you require 3000€ that gets converted from dollars. For sake of argument I am going to use today’s DoD exchange rate of .6755 for my calculations. (August 28, 2011)
To get 3,000€ from SCU or CB on base it will cost you $4,441.15.

If you use your SCU debit card or ATM card (this does not work for CB!) at a German ATM, it will cost you roughly $4,330.13 to get the same 3,000€. This is a savings of $111.02. This is money that you get to keep each month my not using DoD exchange rates.


You can see why it is well worth these small steps to get your bills paid using this method. Using the numbers above, you have the potential to save about $1,332 per year! These numbers will fluctuate as the exchange rate changes, but regardless, you will save money monthly by not using a DoD ATM on base. The following information will spell out how to save your money step by step.

1. Open a Service Credit Union "Plus Checking" account

In order to save the ISA fee, you must do the following:


  • Use direct deposit (you can direct deposit your paycheck)
  • Use E-statements


December 13, 2011 update: SCU removed the 1500 minimum balance stipulation and has now have capped the rebate to1% of the first $2000 withdrawn. There is no minimum balance required, anymore. In other words, they will refund up to $20 worth of ISA fees per month. Aside from saving the ISA fee, you will also get up to $20 of ATM fees refunded at the end of each month. Here is a document with all of the changes.

Ask SCU to give you and your spouse one ATM and one debit card each. Your spouse will need to be present to get the debit card. Between the two of you, you will have four cards. Each card will have a daily ATM limit of $1,000.00, for a total limit of $4,000 per day. Of course, if you are single, you will be limited to one ATM card and one debit card, giving you a limit of $2,000 per day using the two cards.
Please check with SCU to make sure the above info is still current.

2. Open a German bank account

All decent size villages have a bank. There is bound to be at least one bank within a few minutes of your house no matter where you live. In order to open a bank account at the German bank, you will need your U.S. passport. Request an ATM card and it will be sent to your house in the mail. There is a small annual fee for having the card, but it is too small to even care about. One word of advice is not to deposit or transfer U.S. Dollars into your German bank account. The Dollar to Euro exchange rate at the German banks is not as good as at DoD banks. The German bank is only for taking Euro from the ATM, depositing Euro, and paying Euro bills.

3. Get ALL Euro at an OFF BASE ATM

SCU has an on-base rate and an off-base rate. The on-base rate is set by DOD, and is 2.5 percent above market rate. The off-base rate is set by VISA and is often slightly less (.2%) than the most current foreign exchange rate. When you use your SCU ATM card at the German ATM you get the better VISA rate.

If you use the ATM at the German bank that has your account, you can withdraw your Euro using your SVU ATM card(s) and then either deposit the Euro into that same ATM using your German bank ATM card, or you can walk the money over to the service counter and have the teller help you.


4. Set up automatic payments (optional)

You can have your German bank pay your monthly bills automatically. There is no fee for this service at the time of this writing. If you’d rather pay your bills manually each month, you can go into the bank and do this by filling out the appropriate transfer form. The bank teller can help you with this until you get the swing of it. Just be sure to fill out the form with the teller a few days in advance of the payment being due. Most of your bills will be paid via a bank to bank transfer. You can also make one time payments with the banks online banking as well as set up scheduled payments. German banks do not charge for one time transfers, but the DoD financial institutions do.
Your utility companies (electric, gas, oil, phone, etc.) will automatically deduct from your German account, so this is the time for you to give your new German account number to all of your utility companies.

Make sure you put enough money into your German account to cover all of your bills. One suggestion is to keep 1,000€ in your account and call that amount "zero" so that if your cell phone bill is higher than usual, or if you need to put something on your German debit card, you can. So, if your bills are 2,000€ monthly, you’ll deposit that 2,000€ on top of the “1,000€ Zero amount,” for a total of at least 3,000€ in your account at any given time during the month.

The only downside to this method is that you must remember to deposit your money into your German account monthly. If you are not able to do this one month, maybe due to a vacation, you can simply sign into SCU online banking and wire the money to your German account and pay the 2.5% for that month. To avoid this, you can put the funds into your bank before leaving. If you’re on a paycheck to paycheck program you may want to resort to the online bill pay while on vacation or TDY, etc.

The positive side is that you should be spending at least a couple of hours a month on your finances and going over your debits anyhow. This takes no longer than one stop to the ATM and it will not add to your accounting time in the least. The best part is that it saves you over $100 per month.

It is not complicated and will probably get you to have a better handle on your finances.

This money belongs to you. Regardless of if you are Active Duty or Civilian, this method can save you money. The DoD sets its rate to be flexible with the changing exchange rates. We have verified the reasoning for these increased rates with many sources. As long as you fill out your reconciliation forms honestly and accurately stating how many Euro you spent each month, there is no problem with the method being outlined.

Good luck! If you have any questions, please feel free to post them here at EverythingKMC. We will try to answer your questions as quickly and as accurately as possible.

Important update: It appears that SCU no longer allows their ATM card to be used at non-U.S. bank machines. However, you can still use the above method, exactly as written using the debit card. The only change is the amount of Euro you can take from the ATM each day. Even with this change, you should be able to get enough Euro daily to take care of most anything you need.



5 years, 8 months ago

Here's a solution that will work for anyone to get a great exchange rate (2-3% better than the DoDEA rate). It takes a little work to set up, but we are saving more than $50 a month:

Currency Fair (currencyfair.com)

They charge $4 (3 Euro) per transfer, along with .15% of the total amount (but depending on how you exchange, you may be able to actually get a rate HIGHER than the exchange rate).

To do this, you need three things:

1) A US bank account that can do free online transfers to Currency Fair. Contact them for recommendations and see if your existing bank can do it. (Capital One 360 Checking worked for us)

2) A local German bank account in Euro (such as Kreissparkasse).

3) A currencyfair account. (Easy to set up).

Steps to do a transfer:

1) Transfer funds from your US account to Currency Fair. (Takes 2-3 days)

2) Log on to Currency Fair and transfer the money (either a quick trade or try to beat the market with a Marketplace trade)

3) Once the money is converted, have Currency Fair send it to the German bank (Takes 2-3 days).

I highly recommend this process - and it works even for people that can't set up an ITS account.

If you use the link below, you (and I) get a free transfer:
https://www.currencyfair.com/?channel=RJNLE1

5 years, 8 months ago

Quote by Patrick.s.hayes:
Here's a solution that will work for anyone to get a great exchange rate (2-3% better than the DoDEA rate). It takes a little work to set up, but we are saving more than $50 a month:

Currency Fair (currencyfair.com)

They charge $4 (3 Euro) per transfer, along with .15% of the total amount (but depending on how you exchange, you may be able to actually get a rate HIGHER than the exchange rate).

To do this, you need three things:

1) A US bank account that can do free online transfers to Currency Fair. Contact them for recommendations and see if your existing bank can do it. (Capital One 360 Checking worked for us)

2) A local German bank account in Euro (such as Kreissparkasse).

3) A currencyfair account. (Easy to set up).

Steps to do a transfer:

1) Transfer funds from your US account to Currency Fair. (Takes 2-3 days)

2) Log on to Currency Fair and transfer the money (either a quick trade or try to beat the market with a Marketplace trade)

3) Once the money is converted, have Currency Fair send it to the German bank (Takes 2-3 days).

I highly recommend this process - and it works even for people that can't set up an ITS account.

If you use the link below, you (and I) get a free transfer:
https://www.currencyfair.com/?channel=RJNLE1


Patrick,
I have been using Currency Fair for over six months now, I also highly recommend them.

It takes less than 24 hours for the money to get into my Kreissparkasse
account.

I like using the MarketPlace for a better rate also.

Thanks for passing the info on to all the members

5 years, 7 months ago

You are doing wire transfers, not bill pay? Currencyfair told me they can't accept bill pay which adds inconvenience and fees (with service credit union). I presume Capitol one doesn't charge for the wire transfer?

5 years, 7 months ago

I am pretty sure that every financial institution would charge for a wire transfer. Let us know what you find out from Capitol One, please.

5 years, 7 months ago

Are you doing wire transfers with currencyfair?

5 years, 7 months ago

Quote by travelmeister:
Are you doing wire transfers with currencyfair?


I am not doing transfers with anyone. I am back in the U.S., now.

5 years, 7 months ago

Quote by travelmeister:
You are doing wire transfers, not bill pay? Currencyfair told me they can't accept bill pay which adds inconvenience and fees (with service credit union). I presume Capitol one doesn't charge for the wire transfer?


CurrencyFair allows you to send money online to a third party.
This could come in handy when you need to transfer money for;
Foreign Property purchases
Buying goods/services online
Sending money to friends or family
Mortgage/Loan repayments at home

Quote by travelmeister:
Are you doing wire transfers with currencyfair?


You can send money with Kreissparkasse online, not sure if it is called a "wire" but it shows up in their bank the next day. I use it a lot buying items on eBay.de

5 years, 7 months ago

For Patrick and Greenwr, how are you transferring dollars to currencyfair? Wire transfer, popmoney? That is the trouble I'm having at this time... Currencyfair won't accept billpay.

5 years, 7 months ago

If you work for the DoD, why would you not have your pay sent dirctly to a German account? There are no fees and the market rate is used.

5 years, 7 months ago

Quote by travelmeister:
For Patrick and Greenwr, how are you transferring dollars to currencyfair? Wire transfer, popmoney? That is the trouble I'm having at this time... Currencyfair won't accept billpay.


travelmeister, I send $ via USAA to currencyfair trade for € and send back to Kreissparkasse

5 years, 7 months ago

I wish I could do USAA; as an AF civilian, I don't believe I can. I know AF won't support use of ITS to do direct deposit to a German bank...

5 years, 7 months ago

Quote by travelmeister:
For Patrick and Greenwr, how are you transferring dollars to currencyfair? Wire transfer, popmoney? That is the trouble I'm having at this time... Currencyfair won't accept billpay.


Quote by travelmeister:
I wish I could do USAA; as an AF civilian, I don't believe I can. I know AF won't support use of ITS to do direct deposit to a German bank...


Do you have the Currencyfair account set up? You just add CurrencyFair Ltd - Client Account to your bank and send them money from it.

Beneficiary CurrencyFair Ltd - Client Account
Account No 6550962904
ABA/Routing Number ABA - 026009593

in about 2-3 days the money is in your CurrencyFair account

5 years, 7 months ago

Quote by travelmeister:
I wish I could do USAA; as an AF civilian, I don't believe I can. I know AF won't support use of ITS to do direct deposit to a German bank...


The AF would do a deposit to the US Treasury by allotment from your pay. The treasury does the transfer not the AF.

5 years, 7 months ago

Quote by travelmeister:
I wish I could do USAA; as an AF civilian, I don't believe I can. I know AF won't support use of ITS to do direct deposit to a German bank...


From the Army POC:




"The Air Force POC can be reached at '86cpts.civilianpay@us.af.mil'. Currently, the Air Force civilians are not allowed to participate in the ITS program. The program is open to Air Force active duty military."




Why they won't do it for everyone is beyond me. The system is there and proven to work.

4 years, 2 months ago

Hey everyone, it's been awhile since this thread has been active (and I do see the other, more recent threads regarding Euro/USD stuff), but my wife and I just arrive and I wanted to ask specifically about the most recent thing mentioned here (currencyfair)

AD AF here, so I don't know if the ITS thing works for AD AF yet, but currencyfair seems easier anyway. So, my wife and I opened a bank account at Community Bank on base because we needed an IBAN number to give to the German bank that's processing our home loan (we're buying - should find out if we were approved in a few days), but there's $1 in the account and I'm not sure I plan on using it at all.

Currently, our primary bank is USAA, and based on this thread (I sifted through the 7 pages in 2 hours today and did a little independent research; all the posts and information were much appreciated), Currencyfair still seems the best option, as the effective rate of transfer based on 2014 rates came out to 0.29%

It seems that Currencyfair is still a flat 3 euro fee plus 0.35% now, so the effective rate now becomes 0.49% (ex: $2500/month would be $8.75 + $3.43 (3 eur to usd), so $12.18 on a $2500 transfer), but that's still twice as good as the 1% that mastercard may charge you even if you have free atm withdrawals, so I just want to check and make sure people here, in general, still use and enjoy currencyfair? Then, specifically, people with USAA as their primary bank?

Also, by using the above method, I think I'd be able to avoid getting the Capital One Online Banking and Capital One Credit card methods that were recommended above, since USAA offers free transfers to currencyfair, right? My wife and I already have a Chase Sapphire Preferred Card that we use for our credit purchases here in Germany (0% foreign transaction fees), so if I use currencyfair, would there be any reason for me to use my Community Bank account, or need a Capital One Online checking account, or Capital One card? At the moment, pay is direct deposited into the USAA account, and there doesn't seem to be a reason to change that if I use currencyfair.

Currencyfair seems to be the simplest (and most effective) means of saving money each month on mortgage and utility payments, but please correct me if I made a mistake above, or if there is something better now. Thanks in advance for the help

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