Manage your money while working abroad
You’ve been offered a glamourous job abroad and it’s an exciting new opportunity for you.
What’s the best way to manage your financial affairs, make the most of your earnings, and have access to your money while you are on assignment in a foreign country?
Let’s look at some of the key considerations:
Political and economic stability
Economic volatility often goes hand-in-hand with political instability. It’s important to examine the country’s economic, financial and legal fundamentals. There are many excellent sources of information on the economic and political climate of foreign countries.
You may decide that your money is more secure in an international bank if the country you are going to is not as stable as you would like. You might also find this a better alternative for receiving your salary, and you should consider how much of your money will stay in this account
Do the research
When you are overseas, you will need to ensure that you have access to cash in the first weeks or months of your stay, until you have successfully opened a new bank account.
It’s important to do the research, find out how much you need to live, where you will be able to draw money, what the withdrawal limit is, what fees may be applicable, and what the tax, regulatory and legal implications will be going forward. Bear in mind that citizens of some countries are taxed on their worldwide income no matter where they work.
Transferring money between accounts
International bank accounts allow for the movement of money between countries which can be extremely helpful if you continue to earn income from investments and property in your home country while you are on assignment abroad.
An international bank account makes international payments quick and simple, and enables you to start or continue saving while enjoying your new life adventure. Opening a local account may make it easy to manage you daily financial needs.
Looking to the future
Say you decide that you enjoy your new home to such an extent that you have no plans to return. In this case, it may be worthwhile converting all your cash into the local currency. This is particularly important when dealing with volatile foreign currencies.
One of the key reasons to open an international account is that you will have a secure place for your wealth, which will facilitate diversification and provide onward investment opportunities. These can provide tax benefits for expats and non-residents, which are often seen as an ‘added bonus’ for people who make use of them. Some are complex and targeted at sophisticated investors. Depending on the country you move to, different opportunities will present different risks.
A financial planner can recommend what type of portfolio will best suit your needs and risk profile, based on your attitude to risk and volatility, investment time horizon, investment experience and age.