The Western Union Business Solutions Learning Center is a blog provided for general informational purposes only and should not be construed as legal, financial, tax or accounting advice. Consult your own independent advisors regarding your particular needs and circumstances.
Navigating a divorce settlement is daunting enough, but when one's ex-spouse and children live abroad, it adds another layer of complexity. The process of sending cross-border alimony and child support payments is logistically more difficult and "requires extra coordination," says Lisa Tose, family law attorney in Leduc, Alberta, Canada. Failure to pay could result in the withholding of tax rebates, revocation of one's passport or driver's license and, in extreme cases in Canada and the U.S., jail time.
For this reason, it's in one's best interest to understand how an online foreign exchange service can ensure compliance with court orders.
When sending money overseas for child support or alimony, it's imperative that individuals don't send cash payments. These international payments can be sent through a third party, like a trusted online foreign exchange service that can track money transfers.
— Michele Sacks Lowenstein, family law attorney, Lowenstein Brown
"It's so important to keep good records and have tangible proof that payments were made," says Michele Sacks Lowenstein, family law attorney at Lowenstein Brown, a law firm based in San Diego, Calif.
With an online FX provider, an individual can use a tracking number to see when the international payment was received and obtain email confirmation of the money transfer, both of which offer peace of mind. These records can be used to refute claims of missing payments made against the payer.
Added advantages of using an online foreign exchange service for sending money overseas are cost savings and convenience, such as having pre-stored bank details to save time when making ongoing international payments. Late payments can result in various financial penalties, so it's important that individuals consider transit time to ensure payments arrive by the date agreed upon in the court order, Tose says.
If someone doesn't live abroad, a provider can help in this instance by using its relationships with banking institutions in other countries to expedite alimony and child support payments.
"With an online system, you have the benefit of executing a transaction in many different currencies and making those payments happen a lot quicker," says Victor Hinojosa, director of North American partnerships with Western Union Business Solutions.
When sending money overseas, individuals can choose to lump multiple months' worth of payments into a single money transfer. In general, consolidating sums can help minimize the charges levied on a foreign transaction and can allow individuals to get a better exchange rate, which can help keep costs down, Hinojosa says. Individuals can also subscribe to email currency exchange rate alerts from a trusted online foreign exchange provider, which alert them to preferred exchange rates for their foreign transactions.
However, in the case of child support payments, Sacks Lowenstein recommends paying on a regular monthly basis, rather than lumping payments together. If individuals in emerging markets don't have this flexibility, paying in lump sums may be the most favorable option. In these cases, Sacks Lowenstein says, "I recommend that the recipient only withdraw the payments as they become due on a monthly basis and not be paid all at once."
By choosing the right method and practicing caution when executing foreign transactions, both payer and payee can ensure that child support or alimony payments are made in a timely, efficient manner. "The laws are different everywhere, but as long as people honor their obligations, the payment process doesn't have to be difficult," Sacks Lowenstein says.
Example: 1USD = xx INR
Have an ideal rate in mind? Set up a Market Alert, and we’ll email you if your rate becomes available.Set Rate Alert