Expatriate Financial Advice

Summary: If you're considering relocating abroad you need to take a long hard look at your financial situation, get a few 'money' things in order and bear the following ten key financial advice factors in mind...

When you make any move you will incur a certain amount of financial outlay and go through a period of disruption in your life.

When you relocate overseas and expatriate the costs you will likely incur will be significantly higher and your period of disruption significantly longer, this means you have to have your financial affairs in order before you go.

So, if you’re considering relocating abroad you need to take a long hard look at your financial situation, get a few ‘money’ things in order and bear the following ten key financial advice factors in mind!

1) Keep your financial goals in mind.

You may be moving abroad to start a new job, or you may be moving to find a better quality of life, whatever your reasons for starting a new life overseas remember that your money, your finances and your future do NOT take care of themselves and if you put off until tomorrow the planning you should be doing today and just spend as you go, chances are tomorrow will be too late! 

You may have to put your plans for saving and investing on hold while you relocate but keep your plans in mind so that when you are settled you can continue to provide adequately for your family and make your money work harder for you. 

If you don’t know where you’re going, you can never get there, and if you don’t know what your financial goals are, you will never attain them!

2) Get rid of the ‘wrong type’ of debt.

Having the wrong sort of debt that costs you massively in interest payments and brings you nothing in return will prevent you from making financial progress.  Get rid of credit and store card debt, pay up loans before you go.

Once you have relocated remember that while we all want nice things in life now, at what cost do they come?  Are you guilty of living for today and not planning for tomorrow?  Stop the pattern when you move, and spend in relation to what you have earned and not in anticipation of what you will earn - that way you will prevent yourself from over stretching and failing to make a go of your new life.

3) Have an emergency fund.

Don’t leave yourself wide open to fate!  Moving abroad is a large undertaking and one that may come with a few surprises along the way.  If you have an emergency fund that will pay for an extra month’s rent or an emergency flight ticket back home you will be comfortable in the knowledge that you have breathing space and time to adjust and that you are not under pressure to begin earning and saving immediately you arrive. 

Going forward, always cover yourself with a cash portion of an investment portfolio that is sufficient to take the pressure off should you run into short term financial difficulties. 

The cash part of a savings portfolio is the most important part to cultivate and it provides peace of mind as well as giving you easy access to funds in the short term. 

4) Plan for retirement.

If you’re moving abroad to retire then maybe you can ignore this point!  Otherwise ask yourself who will look after you when you retire?  As an expatriate you can’t rely on the state and in this day and age it is totally unfair to consider relying on your children, you can’t finance your retirement with a loan so how will you survive? 

YOU are the one who will have to keep you in your old age!  And it is never too soon to begin your retirement planning and as an expatriate you have a massive potential offshore advantage that will kick start your planning, so make sure you take advantage of it while you’re overseas.

5) Get life insurance!

If, God forbid, something were to happen to you or your spouse, how would the surviving partner cope?  It would mean double the responsibility, no personal and emotional support, one main income lost, surviving in a foreign environment...it just does not bear thinking about further. 

Get sufficient life insurance to protect the future security of the ones you love and take the above nightmare consideration out of the picture once and for all.

6) Think twice before taking financial advice from your friends and family.

Not meaning to insult your family and friends - but what’s right for one person’s financial circumstances and goals may not be right for another!

When it comes to financial decisions and investment planning we are all unique and our circumstances and requirements change on an annual basis at least! 

And if you don’t believe me just stop and think for one moment about whether your personal circumstance reflect to the letter those of the advice giver particularly if they are living ‘back home’ and you’ve expatriated? 

To understand an individual’s personal and financial position, to understand and time investment and market conditions and decisions takes skill and professional judgement…

7) Teach your children about money matters.

Bad financial habits are learned and inherited so take some time to educate your children and set them a good financial example to follow.  They need to understand that money is not in endless supply (even if it is!).  Try and help them understand the work ethic and that with effort comes reward - if you lead they will follow.

8) Don’t misjudge risk.

Make sure you consider and understand the element and nature of any risk involved in an investment you have or are about to take out.  Know your own attitude to risk and be clear about what is acceptable to you before you proceed.

9) If in doubt - ask!

If you ignore a problem it rarely goes away and when it comes to financial matters if you ignore a problem it can end up escalating in size and gravity.  Your key to financial success is getting informed, getting in control and taking appropriate action.  Seek qualified advice!

10) Don’t miss out on the offshore advantage!

As an expatriate you may be in a position to benefit from all the offshore world has to offer in terms of tax saving, better investment selection, asset protection, higher paying interest rates...you need to find out whether you can take advantage of offshore bank accounts, savings policies, investment vehicles, mortgages etc.

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