Categorized | Money

Managing money in Spain

Posted on 08 May 2012 by American expat!

Banking in Spain

Don’t stress about banking in Spain, it’s the one thing I can say they are very efficient at. Unlike in the US, there are no wait times on deposits nor transfers – they are instantaneous. The most popular bank in Catalunya is Caixa Catalunya, after which is probably La Caxia. All you need is a passport to open an account if you are a foreigner. You’ll pay a service fee of 5 Euro a month. If you have a NIE, the fee is waived. Online banking is great, though not necessarily well translated if you choose their English version, but easy enough to navigate and again, transfers to others or to pay bills are instant-no waiting.

Cheap method to transfer money between the US and Spain

If you don’t have an income in Spain, or need to occasionally transfer money to your Spanish account, transferring money from your US bank account to your new Spanish account will cost you about 40-45 dollars a pop. That’s because you have to buy a bank wire. There are not too many alternatives that cost any less, however I DID find one way that takes a lot longer but is far cheaper. If you plan ahead this will work for you.

You will need two Paypal accounts. To open a Paypal account you need a unique email, so use your current email and link it to your US account, and then just create a new gmail/yahoo/hotmail account to set up another Paypal account linked to your Spanish bank account. Once you get them validated, you can gift yourself money from your US Paypal to your Spanish Paypal.

Be sure to mark the transfer as a GIFT, otherwise you will pay Paypal’s high commission rates.

This works, I did it for over a year. Paypal will contact you once you reach 2500 dollars in transfers to make sure you are not laundering money. You will have to prove you own both accounts and have an address in both places. Don’t worry they won’t close your account. They want the money. I still use this method on occasion and it works just fine.

EDIT: As of November 2014, I have stopped using Paypal for my transfers because of their conversion fees. I now recommend TransferWise.  The cost to send from US banks is a flat $15 for amounts over $1500. Read more about it here.

5 Comments For This Post

  1. Tom Says:

    As we prepare to become expats and move to Catalonia, this blog has emerged as the most informative (and entertaining) blog of the bunch. Nicely done!

  2. American expat! Says:

    Thanks Tom! Happy to help (and entertain).

  3. Wally Says:

    I have to say, I am enjoying your website tremendously. I am a retiree and planning to live in Barcelona in the foreseeable future. I get SS and a little pension from the company I retired from. Based upon your experience, what is the minimum income one should have to live comfortably in Spain, specifically Barcelona? Thanks.

  4. American expat! Says:

    Well Wally, that depends on how you define “comfortable”. Comfortable by US standards? UK standards? (they are different).

    I have been working on a post addressing this because I get this question all the time. Salaries are FAR lower here than in the US for the same job. However people have fewer things, because “things” are generally more expensive (no free trade here) but also people are far more social than say in the US or UK. So in home entertainment isn’t something too important – there is always some kind of organized celebration going on at the neighborhood and city level, much of the time free. There isn’t the need to own a car, healthcare, however crappy, is available to all residents (though if you can, you’ll want to pay for private services) and to top it off, wine and beer is cheap! Your biggest expense will always be your rent – it frequently eats over half of one’s salary.

  5. El Polaco Says:

    I realize that this post is somewhat dated and the Paypal suggestion is definitely helpful for recent arrivals. However, I wouldn’t suggest CaixaCatalunya to anyone. It is definitely not the most popular bank in Catalunya, which happens to be La Caixa (which you did mention, and is also the largest company in Catalunya). Here is a list of banks listed in order of strength from the recent Oliver Wyman audit:

    http://i.telegraph.co.uk/multimedia/archive/02354/santander_2354428c.jpg

    I would suggest anyone arriving in Catalunya to avoid any institution below Sabadell on the list. CaixaCatalunya is listed, as Catalunyabank, just above Bankia (the bank needing an immediate bailout and whose officers are under investigation). I’m not trolling your posts, but I think you may be making ill-informed recommendations and/or suggestions. Talking to other ex-pats in Barcelona does not constitute proper research.

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