7-Step Financial Checklist for Moving Abroad
Are you also thinking of settling abroad? Well, you are not alone! A growing number of people all across the globe are considering leaving their home town for career opportunities, further studies, a lower living cost, or to stretch out the savings in hand for retirement. In some countries, a booming economy and a lower living cost do not just mean that you will save money but also that you could start earning some.
Many countries offer great incentives for settling abroad, for instance, UAE, Russia, India, among many others offer promising investment opportunities or home loans at a comparatively lower rate of interest. But before you take on the personal loan benefits offered by a personal loan in UAE or start to invest in property elsewhere, be sure you are aware of the true financial implications that you are likely to face if you leave your home country.
Moving and settling abroad without a proper financial plan at hand could leave you in a situation wherein you are stuck without any affordable option for housing or you are unable to return to your home country in case of any sort of emergency. Here is a 7 step checklist stating the money moves that one should make before moving abroad.
Now is the Time to Start Saving
If on a serious note, you are considering moving and settling abroad, now is the time to put your funds towards savings. Before moving, it is good for you to have at least 7 to 9 months’ worth of your expenses in your bank account, or in any easily accessible savings vehicle holding a low degree of risk.
You may be requiring more or less of the amount of savings depending on your current lifestyle. The exact amount that you will be required to save depends on your job status and nature, your family status, the lifestyle you and your family members have, the exchange rate at present, and your local network abroad.
As a to-be expat in the future, do not just plan for the costs involved in moving abroad. Also think about the costs involved if you plan to move back, or the costs involved in flying back and forth to visit your friends and family members.
A question you might face in your journey is – “what if I have an opportunity to move out of my home country before I reach the goal I’ve set for my savings?” Well, in such a case, make sure you have at least enough funds to cover for your housing expenses, inclusive of the security deposits and other costs involved in settling-in, also any emergency health care expenses.
Create a Budget for Settling Abroad
It is obviously great to have savings, but you also need to understand the targeted country’s cost of living. If you are unsure of the cost of the things in the new country, your savings might last for a smaller period than you think.
Before moving out of your home country, figure out the housing costs, the cost of food, entertainment, education, transportation, insurance, and utilities. From this point, you can move forward and create a monthly budget depending on the amount of your income and your projected expenditure.
Many countries’ sample budgets can be found on the internet. There are also many online checklists and calculators that can give you a helping hand to plan your budget.
Once you have moved abroad for good, track your expenses for a couple of months and match it with your budget. You can then make any required adjustments.
Choose Your Bank Well In Advance before Going
You should make it a point to research on the banking system of the country you are planning to move to along with the banks available. To mention a few things, you can check for the following:
- The bank’s international clearing networks.
- The type of credit cards they issue.
- If the banks participated in networks and partnerships that are customer-oriented.
- If there is a guarantee on the bank deposits.
- The various variables such as the interest rates, ATM access, and various fee and charges.
- If you need help with your funds for moving or funds to buy a new house, choose a bank offering a personal loan benefits. For instance, choose a personal loan in UAE offering a decent interest rate and flexible repayment period.
- Finally, make sure that you qualify for the banks’ accounts.
Start Setting up Your Bank Account Now
If it is allowed, start the application procedure for setting up an overseas account before you even leave your home country. While it may not be possible for you to open an account before you arrive in the host country, you can at least gather the different documents that you will require when you arrive there.
Any delay caused in opening a bank account can lead to an unexpected financial burden. Without having a local bank account, you might face problems while finding a house, obtaining a phone or any credit card, or cashing your paycheck.
Make sure to get in touch with your new bank beforehand and enquire about the documents that you will need to get going.
Understand the Taxes for Expats
Well, you should kill any hopes that you have to escape from your tax bill. Many countries require you to file returns and pay the taxes even when you are living elsewhere, also even if you are filing in your host country.
This does not necessarily mean that you will be paying double the tax. These issues and situations are quite complex in nature which is why it is always best to get in touch with an expert and discuss your situation before you move to your host country.
Continue Saving for Retirement
Irrespective of how easy it is to live in your new country, you should make it a point to dedicate some cash every month towards your retirement. If you are working for a company that provides you with retirement benefits, and also ask for their policy for expats. For anyone with traditional vehicles should find out the prohibitions while living overseas.
You should find suitable ways to save towards retirement, you can consider investing or opening a savings account dedicated only towards retirement funds.
Keep a Check on Your Credit
If you are holding a great credit score, you might risk it when you leave your home country for a long period that could cause some financial trouble when you decide to return home.