Thinking about making that big move overseas? Well, before you start looking at plane tickets, accommodation and the job market, it’s wise to take stock of your financial situation and the implications of moving abroad. Failing to put together a financial plan of action could mean your dreams of a new life in a new country are dashed before they even begin. From finding the right bank account to investigating currency exchange options, these tips will help your dream to become a reality without crippling your finances.
1. Get saving right away. There are so many unforeseen expenses that can creep up when relocating abroad. Fees for immigration paperwork, moving costs and the general cost of living are just some of the costs you need to take into account. And that’s just the tip of the iceberg.
You should plan to have no less than nine months’ living expenses in your bank and easily accessible. Of course, this amount will depend on whether you have a job in your new country of residence, a family to support and any other immediate financial commitments. The current exchange rate will also dictate how much money you need to make available.
2. Build a budget and stick to it. Once you have healthy savings to fall back on, it’s time to develop a budget. It can be easy to become complacent when you have a bit of money in the bank, but this could be disastrous. The most sensible thing to do is to work out a very lean budget and to stick to it. You’ll need to identify costs such as accommodation, food, travel, entertainment, schooling, insurance, utilities and other expenses in your target country. This will help you to create a solid monthly budget and know exactly what you are letting yourself in for.
3. Look into bank account options before you leave. Any future expatriate, especially those travelling to countries with a banking system that is less developed, should review all bank account options as soon as possible. If in doubt, you could hire the services of a financial advisor who specializes in overseas relocation.
4. Investigate money transfer and currency exchange options. Of course, you will want any money you have saved to stretch as far as possible once you make it to your new home country. If you are going to be transferring money between bank accounts before, during or after your big move, it’s important that you get access to the best exchange rate. Fortunately, there are many online money transfer specialists who can give you access to wholesale exchange rates. Always benchmark two to three live quotes before settling on the deal you go for. It pays to shop around on currency transfers.
Golden rule? Benchmark the sell rate you are offered with the mid-market rate on a reputable currency converter. This is the only way to know the true cost of your cross-border payment to the penny or nearest dollar.
5. Choose a reputable removals specialist. So, once your immigration papers have all been signed and you have the go ahead to move, it’s time to arrange those all important removal services. There are many ways you can save money on your removals and the amount you save will depend on how flexible you can be.
For example, here are some ways you could make some great savings on your removals:
- Have a yard, garage or boot sale a few months before your departure date to get rid of unwanted items and make some money.
- Shipping via sea rather than air could save you thousands. However, you will have to wait longer for your belongings to arrive.
- Rent out your old home, including all furniture, and buy new when you get to your target destination. If you don’t need to raise funds through the sale of your home, this is a great way to make some extra money every month through rent.
Relocating overseas is an exciting prospect, but the sad truth is that many people fail to make a go of it because they run out of money. By planning your move well, arranging your finances and comparing exchange rates and other costs, your relocation should go smoothly and be a permanent move.
Daniel Abrahams is the co-founder of award winning foreign exchange comparison website MyCurrencyTransfer.com. Last week, Daniel demoed his latest B2B innovation CurrencyTransfer.com at Finovate Europe 2014, the world’s leading conference showcasing the future of financial and banking technology. You can connect with Daniel on Twitter.
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