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Suppose I have a family member attempting to send me a larger than normal amount of money. The question comes up of course about how to actually move it. I'd like to assume that there may be multiple rounds of moving, something on the order of 5-10 events total since the entire value will be drawn from separate sources arriving at different times, each one above $10,000.

Wire transfers have associated fees, the originating bank claims "$20" to send a wire transfer, my bank claims $0 in fees to receive a transfer. Reading this link though I see the following quote:

Hidden fees – Your bank might not charge a fee, but there may be an intermediary bank that charges one. You may not know until the money shows up in your account.

How much could those "hidden fees" be in reality? If it introduces a level of uncertainty about how much money is going to actually show up once my family member hits "send," why do people use Wire Transfers over other methods of moving money? Below are other options I know about, but I'm sure is pretty far from exhaustive.

  • Personal Check - The amounts in this case I feel would cause a longer delay in receiving the funds, I understand it could even be refused at my bank.
  • Cashiers Check - If I get mugged walking out of the bank I'm just SOL
  • Some form of connecting account at the originating bank - Only downside I can think of is the level of trust necessary.
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    what countries are involved? how far apart are the two parties? A cashiers check is still made out to a specific person.
    – mhoran_psprep
    Feb 4, 2022 at 16:02
  • @mhoran_psprep Country in both banks cases is United States.
    – Confused About Money
    Feb 4, 2022 at 16:16
  • You might want to define "large." What banks think is large and what you think is large may be different. Personal checks for < $100k, for example, aren't close to large; you can just write the checks and move on with your life. The reason you want wire transfers is that they're faster to consume (but more of a pain to send), since you usually don't have to wait for checks to clear. If you're going to do this often, think about both sides opening accounts at the same bank (no connection between the accounts) since same-bank checks may possibly clear faster.
    – James Moore
    Feb 5, 2022 at 19:29
  • "First, determine if you really need to wire the money. If you need to transfer money within the U.S., there are often ways to do that with your bank that don’t require a wire transfer."
    – Mazura
    Feb 6, 2022 at 20:28

4 Answers 4

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Since you are receiving money from a family member [and thus presumably have a high degree of trust], it seems cheque payment will be simplest, as long as you are willing to wait perhaps 1-2 weeks for the cheque to clear. Note that how long you have to wait will partially depend on your bank's ability to trust you based on your own history with that bank.

Fees would be effectively nil, compared to, say, $20-$40 per wire. If you were to receive 10 payments at a probably-worst-case $40 wire fee per, that would be $400 saved, at the cost of some delay. Since there are multiple payments expected, it seems this is not a 'money needed today' scenario.

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    Thank you, no I am gainfully employed so don't need the money to live, but having no experience ever trying to move a large amount just trying to gauge the best way. My biggest hangup right now though is still that "hidden fees" quote, since I can see what the starting bank says and what the ending bank says, I have no idea about anything in between or what that generally looks like. Someone I don't necessarily trust was trying to tell me it could be upwards of "10%", which sounds ridiculous to me.
    – Confused About Money
    Feb 4, 2022 at 16:43
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    @ConfusedAboutMoney The thing about wire fees is they are flat, not proportionate. $20 for a retail customer sounds about right for the fee you pay, and technically intermediary banks may also charge you, though if you are sending it domestically you may have no further intermediary fees at all, depending on which banks it is sent through. If you are sending $100 - absolutely don't send a wire. If you are sending $1M, it has no bearing on decision whatsoever. You could always ask a bank teller at your bank what they recommend, but realistically if trust/timing is no concern, checks are great.
    – Grade 'Eh' Bacon
    Feb 4, 2022 at 16:45
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    @ConfusedAboutMoney usually the "hidden fee" is for intermediary banks when one of the two banks on the transaction ends is a small bank or credit union and doesn't have direct access to the Fed wire system. This actually becomes increasingly rare, and the fee in this case would be similar to the origination fee ($20-40), but better check with the bank (the one that would need it, if any).
    – littleadv
    Feb 4, 2022 at 18:27
  • If the check is being sent in the US mail, you have the possibility of it becoming lost. If you want to ensure that you receive it, you will have to pay for services such as registered mail or certified mail to be sure that you will receive the physical check.
    – Ellie Kesselman
    Feb 5, 2022 at 15:55
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    @EllieKesselman Agreed - cheque payment becomes more complex to secure if you aren't able to hand deliver it. It seems this is not an issue for the asker in this case, but could be for others.
    – Grade 'Eh' Bacon
    Feb 7, 2022 at 13:51
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Some of the things covered by the other answer are valid in the US as well.

Wire transfer is secure.

This is true in more than one way. First and foremost you don't have the risk of physically losing it. But, there's also the risk of the payer being unable to pay ("bad checks"), refusing to pay ("stop payment"), or reversing the charge (alleging the check was forged, stolen, improperly handled, fraudulent, etc). The same risks also exist with ACH transfer, but a paper check can also be lost or stolen.

checks are rare

Well, not in the US, but see above. If checks are needed for large amounts, people usually use cashier's checks, which are guaranteed by banks issuing them. But even then fraudulent/forged checks are possible and are the basis for many scams.

wire transfer is usually free

Not in the US, but fees are usually fixed and relatively low ($20-50 to send, and usually much less than that to receive).

it is fast - guaranteed within a working day or so

One-two business days in the US is the norm, depending on time of the day the transfer originates and the banks involved you can even make it a same-day transfer.

IBAN account numbers have a built-in checksum

This is unfortunately not something the US banking system has. In the US we use routing and account numbers and mistakes can happen. That is one of the drawbacks of the US wire system, such mistakes may be complicated to fix. It gets even worse with SWIFT-based transfers (usually international).

transferring physical cash is actually illegal

Technically not in the US, but it can create complications. Cash transactions over $10K have to be reported, and if cops stop you with a truckload of cash they can claim it was illegally obtained, take it from you, and you'll have to prove them wrong (see Civil Forfeiture in the United States).

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    Just to point out - the reason cashier's checks are used rather than personal checks, is less about them being 'large', but if they are 'large, and between 2 people who do not fully trust eachother'. ie: if you sell your car to someone, don't accept a personal cheque, because their ability to pay won't be guaranteed for 1 week+, while your bank proceeds to clear the check. Cashier's check [as long as it is not a forgery] is effectively proof that funds will be made available.
    – Grade 'Eh' Bacon
    Feb 4, 2022 at 16:47
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    @Grade'Eh'Bacon for sure with people you don't completely trust, but even with people you do. Large amounts will be put on hold, may be for weeks, when depositing personal checks. With cashier's checks holding periods are much much shorter.
    – littleadv
    Feb 4, 2022 at 16:48
  • @EllieKesselman checks are not reported, cash or cash-equivalents (money orders or traveler's checks for example) are. Cashier's checks, while cash equivalent, are traceable and IIRC are not reported either. Wire/ACH transfers are not reported. The purpose is essentially to provide a paper trail, so if it exists due to the nature of the transaction then no report is needed.
    – littleadv
    Feb 6, 2022 at 0:39
  • @littleadv Banks can hold large personal checks for weeks, but it isn't routine. Regulation CC § 229.12 and § 229.13 lay out the check hold guidelines that banks are expected to follow. If I'm reading the code correctly, anything more than a 7 business day hold for a large check is not routine, and would only be used if the check is suspect. The Wikipedia page on the expedited funds availability act seems to corroborate that. Of course, the hold time of a personal check can never compete with that of a cashier's check.
    – Maximillian Laumeister
    Feb 6, 2022 at 6:18
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    @littleadv Since 2010, all US checks are considered local for the purposes of clearing, so the only non-local checks are foreign checks now, I believe. 229.13(e) covers checks that the bank doubts they can collect on based on "a well-grounded belief in the mind of a reasonable person", and the bank is required to articulate that reason to the customer. I believe that burden of suspicion is greater than simply seeing a large personal check.
    – Maximillian Laumeister
    Feb 6, 2022 at 17:02
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The direct benefits of a wire transfer in the US, compared to other forms of payment, are almost entirely for the recipient:

  • Speed of receipt: If sent early enough in the day, for many banks it will arrive the same day. At most, it will take 1 business day. Most other payment methods take at least 1 business day, and ACH payments may potentially take several business days.
  • Finality: If you receive a wire transfer, you can be certain the money will not disappear in a few days from the sender reversing it. This is because, unlike personal checks and ACH payments, wire transfers cannot normally be reversed. The only exception is when the sender's bank, not the sender, made a mistake in sending it.
  • No holding period: The entire amount will be made available for use immediately on receipt, regardless of how large it is. Large personal checks or ACH transfers, by contrast, may be held unavailable for days as a precaution against it potentially being reversed.
  • If there are any fees, they are typically flat rate per transfer, not proportional to the amount.

Any benefits for the sender are primarily indirect:

  • If the sender personally knows the recipient, the sender may care about the recipient getting the benefits.
  • In a business transaction, the receiving business may demand a wire transfer as a condition of doing business. The sender's benefit from sending a wire transfer is then the ability to close the deal.
  • When a business sends a large payment to an individual, using a wire transfer is part of providing good customer service.
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Since there was no specific country mentioned, I'll offer a European perspective:

  • wire transfer is secure (certainly compared to alternatives)
  • checks are rare and rather difficult to cash (and some banks might not even know what to do with a random check), and subject to some fees, while:
  • wire transfer is usually free within the Eurozone (was not always the case, but it used to be free at least within one country) if done online; visiting the bank in person to issue the transfer is subject to fees (as almost everything else)
  • it is fast - guaranteed within a working day or so within one country, 3 working days within the Eurozone, often immediate (i.e. few seconds) within one bank, and more and more banks are starting to implement immediate inter-bank transfer (was not always the case)
  • it is the standard of moving money and as such there should be no gotchas
  • IBAN account numbers have a built-in checksum so you are less likely to transfer money to a stranger by mistake
  • nevertheless, if you do the mistake anyway, you can usually revert the transaction (this includes some fees, but still beats losing the money)
  • transferring physical cash is actually illegal over certain threshold (in the thousands of €)
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  • Thank you for the perspective, I'd +1 if I could. From your standpoint then, the main benefit for Wire Transfers are the security and speed?
    – Confused About Money
    Feb 4, 2022 at 16:27
  • I think you’re mixing up wire transfers and SEPA transfers, which makes some of the things you said wrong. Wire transfers cannot be reversed (that’s the whole point of them), and they are not guaranteed within one day. With SEPA, nobody in Europe uses wire transfer anymore, it would just be burning money and losing time.
    – Aganju
    Feb 4, 2022 at 19:55
  • Also, transferring physical cash is not illegal. That’s a fairy tale. It is risky and cumbersome, and therefore a bad idea.
    – Aganju
    Feb 4, 2022 at 19:56
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    @Aganju What is your definition of "wire transfer"? Domestic bank wire transfers have been subsumed into SEPA (in the Eurozone), and SEPA is wire transfer. If you take wire transfer to refer to non-banking money transfers (e.g. by a post office or Western Union), these are rare but sometimes done. But we were talking about bank money transfers.
    – Radovan Garabík
    Feb 5, 2022 at 5:42
  • @Aganju Re physical cash - it is not transferring per se, but transferring to someone else but I did not want to go into irrelevant details. Let me take a random country, say Slovakia, see the law nr. 394/2012 Z. z. - the limit is 15000€ for physical persons and 5000€ for commercial payments. The fine for doing so is up to 10000€ in the former case, up to 150000€ in the latter. I would definitely not recomment giving cash to your famiily members....
    – Radovan Garabík
    Feb 5, 2022 at 5:43

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