Working abroad? See these six money tips
Working overseas is the ideal way to improve your skills, learn new ones and increase your earnings.
Moving overseas will require you to relook at your approach to saving, banking and investing. Because your finances will be divided between two countries, you will have to take into account currency exchange rates, how you’ll be taxed and where you want to keep your money.
Here are six ways to take advantage of the financial opportunities that come with working abroad:
Plan your money management
There are several options for managing and accessing your money while working abroad, based on your circumstances and requirements.
Consider the expenses you will need to cover while you are living overseas, including accommodation or housing, everyday living costs and schooling for your children, for example.
Think about appointing a financial planner, who can offer guidance on developing an overall investment strategy that is in line with your financial goals and objectives, advise on asset allocation and minimise taxes to help you make the most of your money while you are abroad.
Managing your money overseas
It’s important to determine how to manage your finances while you are abroad in order to avoid the risks of currency fluctuation. An international bank account will enable you to easily and quickly make international payments, while also allowing you to start saving as you embark on your new adventure.
Bear in mind that choosing the right location for your finances will require research. It’s advisable to plan ahead and think carefully about where you are going to keep your money and how your will ensure the safety of your cash and investments.
Understand your tax obligations
Becoming a resident in a new country and still having financial commitments in another can have an impact on your tax status, and may even result in paying tax twice. Consider getting advice from a tax specialist to help you determine how much tax you will have to pay so that you can avoid unpleasant surprises.
Investing while overseas
One of the major attractions of working abroad is the lucrative opportunity that this may bring. That’s why it is important to think about how you will invest your money to enjoy the best returns.
You will need to consider four key questions:
- How much can you invest?
- What is your attitude to risk?
- How will you manage your tax obligations?
- How will you access your cash?
Depending on the country you move to, there will be different investment opportunities which will all carry different risk.
An international bank account can enable you to more efficiently manage your finances and investments. Setting up an international account also means you can access your money from anywhere in the world, in the currency of your choice
Prioritising your savings
We know we should be saving, but where and how much? Although living in a foreign country can mean enjoying new experiences, it’s important to take advantage of the opportunity you’ve been given and save for when you return home. For many people working abroad, the priority is to earn money, often more than you might at home, and to send it back to your family, or to save for something big like a dream home.
Start by creating an emergency fund to cover you in case you take ill or have an unplanned financial expense. Consider putting aside three to six months of income saved in an emergency fund. It goes without saying that you need to put a percentage of your earnings toward retirement funds. A financial planner can advise on the best solutions for you.