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This post is for those of you living here for an extended period of time. This means you’ll be paying rent, utilities, cable/phone bills, and shopping locally on the economy. The coin of the realm is the Euro and while your US-based bank will provide the service, I think you can do better and keep more of your money in YOUR pocket.
There are the two American banks that you’ll find on our installations. They’re both fine banks and I’ve had accounts with them both, but if you rely on them to pay your way in Germany, you’re very likely to overpay for their services. If you don’t mind burning 2-3% of your purchase in transfer fees or less than optimal exchange rates, then stick with them.
Paying your bills to German merchants, vendors and companies is normally done through “bank transfers.” At the bottom of every bill, you’ll see something called an IBAN (International Bank Account Number). The vendors providing your goods or services give you this so you can send your payments directly to their accounts rather than deal with a cash or credit card scenario. If you an account with an “on base” bank you’ll also have an IBAN number associated with your account as well. They also provide online International Bill Pay services to make things easier.
But, to make sure I was telling the truth I ran a quick test to compare the “value” of two different transfer methods. See the table below:
| On-Post/Base Bank | Wise | |
| Amount Transferred | 100 € | 400 € |
| Amount Converted | $111.26 | $434.07 |
| Fees | $1.00 | $3.59 |
| Conversion Rate | .8988 (€ to $) | .9215 (€ to $) |
| Cost per 100 € Transfer | $112.26 | $109.415 |
As you can see, the transfer with Service Credit Union costs almost $3.00 more than what Wise charges for a 100 € transfer.
If you consider an average rent payment is likely 2000 € every month, by using a third-party vendor like Wise would save you about $56.90 every month. To me and most other people, that’s a significant savings.
I’m not pointing this out to cause problems with on-post/base banking establishments. I just wanted to give you another option so you can save money transferring money between your US-based account and a typical German account.
The banks operating on US bases have told me that they’re forced to offer an exchange rate that’s defined by the US government. I’m not sure who’s making the “extra” money they charge their customers, but I’d like to think I’m doing our fellow Americans a solid by pointing this out.
Trust me, I learned this late in my overseas life, but I don’t mind sharing this with you from the first day you set foot in Germany. I’ll make the wild assumption this information alone is worth over $2000 provided you’re here for a normal three-year tour.
I’m looking at ways you might want to thank me with a small contribution towards the cause, but if you choose not to…think well of me for sharing when you’re maybe using that $2000 for a cruise, taking the kids to Euro Disney, or just setting it aside in an investment account. That too, is thanks enough.
This post contains an affiliate link that will not cost you anything, but will provide us both with a benefit. By clicking any link below, you are giving your expressed consent to look into the offers the vendor may provide.