An essential part of becoming an expat is keeping control of your finances. This expat finance guide will help you to get an overview of different financial aspects that you should consider for your move abroad. We'll also give you a few tips to help you master your finances abroad!
As many other aspects of moving abroad, financial planning is one more thing that will require some of your time. You may find that managing your money wisely as a globally mobile individual is not such a straightforward process.
The first step you may want to take is looking into what your life abroad might cost you. Once you know where you will be moving to, it should be fairly simple to investigate and calculate the cost of living in a particular location. Then it all comes down to planning: think about what you’ll need, how much things are, and start to budget.
You probably know how much you will need to afford flight tickets, but that’s only the first thing. Will you require a moving company? How much will it be to rent or buy a property? How expensive is your new location? Have you thought of inflation or local taxes?
Try to define your objectives and the lifestyle you want to sustain. Having a clear direction will help you to set the base for your financial plan. Little things count: don’t consider only big expenses, but everything else. Find out the cost of food, telephone services, and transportation. Envisaging your daily routine might help you to figure out everything you will need to consider in your budget.
Banking and payment methods can vary from country to country, so find out as soon as possible if you will have easy access to funds from your new location. Maybe you will need to bring cash or traveller’s checks with you, but bear in mind that with large amounts of cash you may have difficulties going through customs.
A common dilemma for expats is whether to open a local bank account or opt for an international option. Some expats choose to open an offshore bank account which grants easy access to financial savings, but these accounts are not accessible for everyone. Furthermore, some banks require a costly initial deposit, or high maintenance fees. Choosing the right bank account will most likely depend on where you are, your individual situation and your specific needs.
Expats have to frequently account for specific international banking fees, money transfer charges or currency exchange rates. Be prepared for this type of expense, and dedicate some time to study the different financial options you have in your new country.
Before making a decision on what best suit your needs, you will need to invest time to gather as much information as possible, compare alternatives, and exercise forecasting. It can be stressful, but you will find this a rewarding learning process that will help you to cut down on expenses in the future.
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