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Banking

Review of Xoom: The Money Transfer Service by PayPal

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Xoom, a PayPal company, is a money transfer service that allows you to make international digital payments that are quick, easy and secure. If your loved ones are scattered across the globe, Xoom lets you send money, pay bills and reload minutes on mobile phones from afar. Xoom services are available in 132 countries, meaning there’s a pretty solid chance that the location you’ll need falls under its umbrella.

In this review, we’ll walk you through the basics of sending money through the platform and help you decide if it meets your needs.

A brief history of Xoom

Xoom was founded in 2001, and PayPal acquired the company in 2015 for roughly $1.1 billion. In 2016, Xoom upgraded its features to allow recipients to request funds and by 2017, the company expanded its presence from 40 receive markets to 67 markets.

Xoom’s international money transfer services have also been integrated into PayPal, making it easier for you to send money outside the U.S. on the PayPal platform as well.

According to its website, Xoom and PayPal have a “shared vision” of making the international payment platform accessible to millions more people throughout the world, so expect it to grow in the future.

Xoom key features

  • High transfer limits: Xoom allows U.S. residents to send up to $100,000 USD within a 180-day period — do note that sending limits are set at three different levels, with different amounts requiring different sets of identification documents. Providing additional information and documents allows for your account to be upgraded.
  • Several ways to pay: Any Xoom service — i.e., sending money, reloading phones and paying bills — can be funded with a bank account, debit card or credit card, as well as a PayPal account.
  • Fees vary: The transaction fee you’re charged for using Xoom’s services fluctuates according to payment method, amount of money sent, where the money is sent and currency selected for disbursement.
  • Fast money transfers: In most cases, money is available to recipients in a matter of minutes, but transfers can take up to a few days. However, if you send more than $10,000 USD within 24 hours, the funds won’t be received for two to three business days, plus the standard processing time.
  • Instant bill pay: Enjoy the ability to pay a variety of utility bills on a loved one’s behalf in Mexico, Colombia, the Dominican Republic, El Salvador, Guatemala, Honduras, Nicaragua, Panama, Costa Rica and Vietnam. Bills are paid instantly, with the exception of Telmex bills in Mexico, which take two business days.
  • Xoom app: You can send money, reload phones and pay bills from the app. Available for iPhones and Android devices, the app lets users check the status of all transactions.

Sending a money transfer with Xoom

How long does a transfer take?Most transfers are completed in minutes, but the process can take up to a few days.
Where can you send money?Xoom allows you to send money to recipients in 132 countries.
How much can you send?Sending limits are set at three different levels (for more detail, see the chart below). Top tier senders in the U.S. — Level 3 — can send up to $100,000 USD within a 180-day period.

To send money via Xoom, you’ll need to create a free account or log in with your PayPal account. If you create an account, you’ll be asked to create a password and provide basic information, including your name, email address, phone number and country of residence. Afterwards, you’ll receive a verification email to activate your account. To connect a payment source to your account, add a bank account, credit card or debit card, and use it in a transaction. Payment sources can be updated or deleted from your “My Account” page.

Senders are categorized into three different levels. Each level has a limit on the amount of money you’re allowed to send during a certain time period. Different information and documents are required to reach each level. During your transaction, Xoom may ask questions, and if you need to provide more information, the company will email you with instructions.

Here’s a look at the sending limits and requirements for U.S. residents, as per the provider’s website.

Level 24-hour limit30-day limit180-day limitRequired information and documents
1$2,999 USD$6,000 USD$9,999 USDSender profile information
2$10,000 USD$20,000 USD$30,000 USDSocial Security Number or passport
3$50,000 USD$60,000 USD$100,000 USD
  • Driver’s license, passport or green card

  • Bank statement or pay stub

  • Answer security questions Xoom sends via email


In most cases, the recipient will receive the funds minutes after they’re sent, but it can take a few days. Several factors can affect transfer times, including the country where your money is headed, the method in which funds are received — either bank deposit, cash pick up or home delivery — and the payment type — from a bank account, debit card or credit card.

In addition to sending limits, this provider also caps the amount of money recipients can receive, based on the sending level of the person(s) transferring the funds — do note that the receiving limits apply across senders. Any transaction that exceeds a recipient’s designated maximum will be canceled.

Here’s a look at the receiving limits from U.S. senders, as per the provider’s website.

From 24-hours 30-days180-days
Level 1 senders$15,000 USD$25,000 USD$55,000USD
Level 2 senders$15,000 USD$25,000 USD$55,000 USD
Level 3 senders$75,000 USD$90,000 USD$120,000 USD

Additionally, Xoom’s partners — these include banks, cash pick up locations and home delivery services — have restrictions that vary by country. These could include the amount of money that can be paid in a single transaction or to a recipient in a certain time period.

Fees and fine print

Fees and Penalties
Transfer feesXoom charges a transaction fee to send money internationally. Fees can vary according to several factors:
  • your payment method

  • the amount of money sent

  • where the money is sent from

  • the currency selected for disbursement


For certain destination countries, you can avoid fees by paying with a bank account, but not every country.

Xoom’s variable fee schedule is on par with other money transfer companies. It’s very common for fees to be calculated based on the criteria used by Xoom. For example, to send $1,000 to the United Kingdom, there are no fees to send from a bank account, but a $30.49 fee to send funds from a debit or a credit card.

Is Xoom a good money transfer service to use?

Pros Cons
  • Xoom app: You can send money, reload phones and pay bills from the app. Available for iPhone and Android, the app lets users check the status of all transactions.
  • Funding options: Users may pay with a bank account, debit card or credit card.
  • Fast cash: Most money transfers are available to the recipient within minutes, but can take a maximum of a few days. When sending more than $10,000 USD within a 24-hour period, it can take between two to three business days, in addition to standard processing time.

  • Variable fees: Xoom charges a transaction fee that can vary according to several factors, including payment method, amount of money sent, where the money is sent and currency selected for disbursement.
  • Limited availability: Money transfer services are available in 132 countries, fewer than competing services.
  • Receiving Limits: The amount of money recipients can receive is determined by the sending level of the sender(s). Receiving limits are also cumulative across senders.




Alternative money transfer options

WorldRemit and MoneyGram are international money transfer companies providing similar services to Xoom.

WorldRemit

  • Where can you send money? Send money to recipients in more than 145 countries, a broader reach than Xoom’s 132 countries.
  • How long does a transfer take? In most cases, funds are immediately transferred to the recipient; however, some transfers may take longer, depending on the mode of receipt. WorldRemit displays the expected delivery time before you make a payment.
  • How much can you send? The maximum amount you may send is determined by the country where you live, and can also vary according to your method of payment.
  • Fee to send money: The cost to send money is based on each individual transaction. All fees and exchange rates are displayed outright.

WorldRemit is based in London, with regional offices in the U.S., Canada, Australia and New Zealand. Since it serves more countries than Xoom, it could be a good alternative if your destination country isn’t on Xoom’s list.

MoneyGram

  • Where can you send money? MoneyGram’s global network of nearly 350,000 locations, along with retailers and businesses, in more than 200 countries and territories. In addition, you can transfer money within the U.S.
  • How long does a transfer take? In many cases, funds are available within a few hours. However, factors including destination country and banking hours can affect the amount of time a transfer takes.
  • How much can you send? When sending money to most countries, there is a maximum of $10,000 per online transfer and up to $10,000 every 30 calendar days. You can send additional funds from a MoneyGram agent location.
  • Fee to send money: The cost to transfer funds varies according to where the money is going, the total amount sent and the method of payment. Fees are generally lower when paid with a bank account than a credit or debit card.

MoneyGram could be a good alternative to Xoom if you need to make both domestic and international transfers. Since its services are available in more than 200 countries and territories, it could also be an option if your destination country isn’t part of the Xoom network.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Laura Woods
Laura Woods |

Laura Woods is a writer at MagnifyMoney. You can email Laura here

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Banking

Best Savings Accounts for Kids

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Piggy banks are fun for small change, but if you want to teach your kids important lessons about managing money and the power of compound interest, get them their own savings account. While your local bank branch probably offers more than one savings account product, you might consider looking online for one that’s designed with children in mind.

To aid in your search, we have chosen six savings accounts tailored for kids from a selection of nearly 100 kids’ savings options offered at banks and credit unions around the country. We based our selections on how well they met these five criteria:

  • Competitive annual percentage yield (APY): Accounts should demonstrate the rewards you can get by saving your money, and a competitive interest rate helps achieve that objective.
  • Low fees: Kids don’t need to lose their money to fees, so finding an account with zero fees was important.
  • Low minimum deposits: Most kids don’t have a large amount of money to save when they first open an account. Having a low minimum deposit requirement can help them get started quicker.
  • Broad geographical reach: Banks and credit unions need to be available to a large geographic market, with extra points for physical locations where kids can go and deposit cash and coins.
  • Great educational tools: Savings accounts that are geared to kids should have some educational tools to help them learn about what it takes to achieve financial success. Bonus points if the tools are fun, too.

 

Best overall savings account for kids: Capital One

Kids Savings Account from Capital One Capital One’s Kids Savings Account has all of the features you’d expect to see in a savings account for adults but with the additional feature of parental controls, which makes it a great overall solution for kids of all ages. The account earns 1.00% APY, has no monthly fees and can be opened with $0. You can set it up the account, and make your initial deposit at a later date.

The Kids Savings Account parental controls allows parents to sign into the account under their own usernames and passwords to help their children manage their funds. Parents always control transfers in and out of the account, offering good balance between independence for the young holder and parental oversight. Kids get to view their balance and watch their money grow.

Capital One lets you create an automatic savings plan linked with other accounts, so you can automatically transfer your child’s allowance into their Kids Savings Account. When it comes to geographical reach, Capital One has approximately 500 branch locations, as well as a great mobile banking app, which allows you to deposit checks and check balances.

Capital One Kids Savings Account
APY: 1.00%
Monthly Fees: $0
Minimum Opening Balance: $0

LEARN MORE Secured

on Capital One’s secure website

Member FDIC

Best savings account for college savings: Citizens Bank

CollegeSaver from Citizens Bank (RI) If you want to be rewarded for consistent savings, the Citizens Bank CollegeSaver account has a bonus you might consider. If you open the account before your child is six and make a deposit of at least $25 each month until your child turns 18, Citizens Bank will give you a $1,000 bonus (the current account APY is a low 0.05%). You can also open this account if your child is between 6 and 12 years of age, but the minimum monthly deposit will be $50 and opening deposit is $500.

If you were to open the account today with an initial deposit of $25 upon the birth of a child (and assume the current APY held for 18 years), and then deposit $25 a month for 18 years, your $5,400 investment would accrue $24.48 in interest. Add the bonus and you’ll end up with $6,449.48. The bank doesn’t put any stipulations on how the money can be spent, so you can use the balance for college or any other financial needs.

Citizens Bank CollegeSaver
APY: 0.05%
Monthly Fees: $0
Minimum Opening Balance: $25 for children under six years old; $500 for children age six to 12

LEARN MORE Secured

on Citizens Bank (RI)’s secure website

Member FDIC

Best savings account for a young child: PNC Bank

S is for Savings from PNC Bank If you want to engage your child with educational tools, PNC’s S is for Savings account offers a lot. Granted, this account offers the lowest APY of the banks that made this list, but it makes up for it with its interactive online banking experience.

The Learning Center features Sesame Street characters that will help them learn basic money concepts. The site has fun activities you and your child can do together.

Features include the ability to set up automatic savings deposits that help them see the benefits of having a savings routine. Kids can work towards goals and learn about the three components of money: saving, sharing and spending. As your child gets older, you may choose to transfer their accumulated balance to a savings account at a bank that offers a higher interest rate.

PNC Bank’s S is for Savings
APY: 0.01%
Monthly Fees: $0 for account holders under 18
Minimum Opening Balance: $25

LEARN MORE Secured

on PNC Bank’s secure website

Member FDIC

Best savings account for teens: Alliant Credit Union

Kids Savings Account from Alliant Credit Union When your child turns 13, Alliant Credit Union considers them to be a young adult, offering their High-Rate Savings Account with a 2.10% APY and no monthly fees. For teens who want to set savings goals, the credit union allows them to set up supplemental accounts that can be earmarked for specific items, such as saving for a new car.

What makes this a great option for a teen is that Alliant also offers an interest-paying teen checking account for kids ages 13-17. The checking account earns an APY of 0.65%. The two accounts can be linked and both will earn your teen interest. Alliant also refunds up to $20 per month in ATM fees if the teen uses out-of-network machines.

To open an account at Alliant Credit Union, you must be a member. Membership is open to employees or former employees of partner businesses or organizations. Or you can join by making a $10 donation to the Foster Care to Success Foundation.

Alliant Credit Union High-Rate Savings:
APY: 2.10%
Monthly Fees: $0
Minimum Opening Balance: $5

LEARN MORE Secured

on Alliant Credit Union’s secure website

NCUA Insured

Best APY for a kid’s savings account: Spectrum Credit Union

MySavings from Spectrum Credit Union Spectrum Credit Union currently offers the highest interest rate on the market for a kid’s savings account, but only on a relatively limited balance. Spectrum’s MySavings account earns 7.00% APY on account balances up to $1,000, making for a rate that’s higher than many CDs. Balances over $1,000 earn the regular savings rate, which is 0.50%. A high interest rate can help get kids excited about savings as their balance will grow quicker.

Spectrum Credit Union currently has branches in six states, but deposits can be made nationwide through the Credit Union CO-OP Shared Network. Membership is open to anyone by joining the Contra Costa County Historical Society ($15 membership fee) or the Navy League of the United States ($25 annual membership fee).

Spectrum Credit Union MySavings
APY: 7.00% for the first $1,000; 0.50% on balances above $1,000
Monthly Fees: $0 for account holders under 18
Minimum Opening Balance: $0

LEARN MORE Secured

on Spectrum Credit Union’s secure website

NCUA Insured

Best online tools for a kid’s savings account: Capital One

Kids Savings Account from Capital One Kids are digital natives, and that makes a kid’s savings account’s online banking features extra important. In addition to being our pick for best overall savings account for kids, the Capital One Kids Savings Account offers a great selection of online saving and budgeting tools that will keep kids engaged and informed.

One of the best features is the ability to create additional savings accounts and set a target goal for each account. For example, you child may set a goal for holiday gifts, another goal for a new bike or car and another goal for vacation money. They can even give each account a nickname, such as “My Wheels Fund.”

Capital One has a full suite of online tools for your child to track their progress and success, helping to keep them focused on their goals. Capital One also offers standard features on its mobile banking app, some of which are available for kids, including the ability to check their balance or make a mobile deposit.

Capital One Kids Savings Account
APY: 1.00%
Monthly Fees: $0
Minimum Balance: $0

LEARN MORE Secured

on Capital One’s secure website

Member FDIC

Why your kid should have a savings account

It’s never too early to start teaching your kids about money, and a savings account is a great tool to help accomplish this aim. According to the 9th Annual Parents, Kids & Money Survey by T. Rowe Price, 55% of parents said their child has a savings account, but just 23% of kids said that they talk to their parents frequently about money. Parents who discuss financial topics with their kids at least once a week are more likely to have kids who say they are smart about money than than those who do not have a discussion with their children.

Savings accounts show kids the value of saving at an early age. They get to watch their money grow as compound interest work its magic, and they can set short- and long-term goals for the money they save. The reward of achieving the goals will teach life lessons on patience and planning. Once you open an account for your kids, share money management tips with them, things like “paying yourself first” by saving a portion of gifts and allowances they receive instead of spending it all.

When you teach your child good money habits early on, you help set them up for success later in life. Putting your child on the path for financial responsibility and independence by choosing the best savings account for kids could be the greatest gift you can give them.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Stephanie Vozza
Stephanie Vozza |

Stephanie Vozza is a writer at MagnifyMoney. You can email Stephanie here

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Banking

Money Management Tips to Help You Save Successfully

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Increasing your savings is easier said than done. The National Endowment for Financial Education’s most recent annual consumer survey found that saving money is the biggest cause of financial stress for more than 51% of Americans. If you feel the same way about your savings, don’t despair. There’s a way to manage your money instead of letting it manage you.

Top 14 money management tips

Have enough income to cover your monthly expenses, but can’t seem to gain traction when it comes to building a college savings fund, saving for a down payment on a home or growing your retirement nest egg? Start by taking charge of your finances by using these simple, yet practical, money management tips.

1. Use a budgeting app

Tracking your spending on the go is easy when you use a budgeting and personal finance app, like Mint or YNAB. Simply download your app of choice and, if you want to, link it to your bank account. You can then input your fixed and variable expenses and monitor your spending with the swipe of a finger. Keeping your budget within arm’s reach also helps you to stay on top of your daily spending and stick to a monthly budget.

2. Trim unnecessary expenses

Examine your spending habits to determine where you can cut unnecessary spending. Food is a common expense that can be reduced with a little planning. A grocery shopping list can be your first line of defense against overspending, as it’s easier to make impulse buys at the grocery store when you don’t have a shopping list to guide your purchases.

3. Commit to a written savings goal

Establishing a clear savings goal can keep you motivated and put a stop to impulse buys. Make your goal SMART: specific, measurable, attainable, relevant and timely. For example: “I will transfer $100 a month to my savings account so that by Month 20YY, I will have $800 to put toward a new television.” Post your written goal in visible locations to help reinforce your commitment to achieving it.

4. Live below your means

Spending more than you earn is a recipe for financial heartburn. When you have more bills than money with which to pay them, you could be subject to late fees and other financial penalties which make it harder to save. Cancel services you no longer need or can access at a lower cost. For example, nix the gym membership if you haven’t used it in five months or downgrade your cable package to only include the channels you actually watch.

5. Pay off debt

Eliminating debt may allow you to save more money. By bringing your balances to zero as quickly as possible, you’ll save on future interest charges. To potentially save money now, consider refinancing your debt to a lower interest rate or transferring your debt to a credit card with a lower interest rate.

Once your credit cards and loans are paid in full, you’ll have additional funds to contribute toward your financial goals. Use the same amount you were paying your creditors each month and deposit those funds into your savings account.

6. Build an emergency fund

Financial experts recommend stashing three to six months of living expenses in a liquid high yield deposit account in case of an unexpected job loss or another financial emergency. If this sounds overwhelming, start with a smaller goal of $500 for your emergency fund.

You can grow your emergency fund account by setting up an automatic transfer from your checking account to your emergency savings account each pay period. To grow your emergency fund faster, consider cutting unnecessary expenses, selling unused items around your home, depositing your tax refund or starting a side job.

Without an emergency fund, you risk paying for your next dental emergency or major car repair with your credit card or a personal loan, which can keep you in a debt cycle that’s hard to escape.

7. Increase your income

As long as you save the money instead of spending it, increasing your income with a side hustle, part-time job or more hours at the office is one of the quickest ways to reach your savings goal.

Before adding additional work to your already busy schedule, determine how many hours you have available along with how many months or years you’ll need to commit to the side hustle. When searching for side jobs, be wary of jobs that require an initial outlay of money to get started.

8. Plan for a regular review

Block out time on your calendar to evaluate your progress toward your savings goals. Consider establishing a monthly or bi-weekly financial review. Asking yourself if you’re still on track or if you’re able to contribute more towards your objectives is key to meeting your goals. A quick assessment of your savings plan can also help identify areas where you may still need to reduce expenses.

9. Never pay full price

Online and mobile coupons make it easy to save on groceries, clothing and big-ticket items like televisions and computers. When saving money is convenient, you’re more likely to stick to your savings plan. Do you do most of your shopping online? Install browser extensions that give you cash back when you shop through their online portals. Is mobile shopping more your thing? Download your choice of mobile app that offers cash back, gift cards and notifications of online and in-store deals.

10. Eat out less

Brown bag lunches and meal planning are smart money management strategies that can save you thousands of dollars annually, but sometimes you’ll want to treat yourself. To keep your spending under control, be selective about when and where you eat out. Make a list of local happy hours, upcoming culinary events and prix fixe restaurants to reinvent what it means to eat out on a budget.

11. Bank your financial windfalls

While it may be tempting to go on a shopping spree, upgrade your ride or take a weeklong vacation in the Caribbean when you get a financial windfall, that might leave you with a financial hangover. Once the thrill has subsided, you’re no closer to your savings goal. Instead, be strategic with any unexpected funds that come your way. Commit to adding at least half of these funds to your savings account.

12. Make savings automatic

Contact your financial institution to sign up for electronic funds transfer. This allows you to designate a set dollar amount for transfer from one account to another before you spend it on something else. For example, set $50 to automatically transfer from your checking account to your savings account on the fifth of each month.

If you have multiple savings goals, use a money savings app connected to your bank account to help to make auto transfers goal-specific.

13. Entertain your options

Movie buffs and avid readers rejoice! Free and low-cost services are available that allow you to binge-watch or read the latest big hit without busting your budget.

Movie rewards programs are available across the country. These programs allow you to earn points based on the amount you spend. Points can then be redeemed for additional movie tickets or concession items. Movie clubs allow fans to consume at least one movie per month at a discounted rate in addition to concession discounts.

The public library is an often overlooked resource for endless media entertainment. Look beyond the hardcover and paperback books, and you’ll find CDs, DVDs and magazines. Many libraries now provide a portion of their catalog online, which means you can access e-books, audiobooks, movies and music on your device of choice — for free.

14. Become rate savvy

Online search tools can reduce the time it takes to locate financial institutions offering the best returns on savings deposits. Use the Maximize Your Bank Savings tool from DepositAccounts, another LendingTree company, to help you identify the best place to park your funds to meet a specific goal. The higher the annual percentage yield (APY) the account pays on deposits, the faster your money can grow. Generally, certificates of deposit (CDs) limit withdrawals but offer higher APYs over savings accounts.

Next steps

A consistent savings habit is necessary to reach both short-term and long-term financial goals. If you’re intentional with your money, you’ll see the results. Recognize each achievement for what it is — documented proof that you’re in control of your financial future. Open a dedicated savings account today, and you might only be a few months away from achieving your first savings goal.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Tracy Scott
Tracy Scott |

Tracy Scott is a writer at MagnifyMoney. You can email Tracy here