Moving abroad may not be an easy decision to make, but it might just be the best decision you’ve ever made. Some countries have a thriving economy and welcome American expats to take part in it. Hundreds of thousands of Americans have moved to Europe, South America, Australia, New Zealand, South Korea, and Thailand among many others If you choose your destination wisely, have a financial plan in place, and stick to your budget, you won’t regret your decision.
However, if you don’t you could find yourself unable to afford your new life. You might even need to return to your home country quickly in an emergency. That’s why preparing a budget is the most important step before moving abroad, even if it’s not your first time.
Let’s explore some key financial tips that will help ensure a comfortable life in your new country and save you from worrying about your budget.
Moving Abroad: Understanding the cost of living in your new country
It’s always best to start preparing for the move well in advance. Make sure you have your important documents ready and know about the visa requirements in your destination. Determine the extent to which English is used in the foreign country, research the cost of living, and create a monthly budget based on your anticipated income and expenses.
Many people struggle during the first few months abroad, at least until they discover the most cost-effective options. Finding out how much it costs to live in your new home can help you adequately prepare for the move.
Your savings may not last as long as you hope unless you truly understand the living costs in your new culture. Those include the cost of housing, food, transportation, utilities, insurance, and other recurring expenses. After you move abroad, you can keep track of your actual monthly expenditures for a few months and adjust your budget accordingly.
Make a list of your expected expenses to determine how much money you’ll need. Things like expat blogs, online sample budgets, moving checklists, and cost-of-living calculators can help you with preparing a budget when moving abroad. Be sure to include:
- Food
- Rent
- Utilities
- Phone service
- Personal expenses
- Entertainment
- Transportation
- Airfare
- Moving services
Ways to cut costs when moving abroad
- Once you have determined your expenses, look for accommodations in neighborhoods that fit your needs and your budget. You will probably find more affordable options outside of city centers.
- If you’re open to the idea of having roommates, you might be able to cut costs and perhaps afford a better neighborhood. Look for fellow digital nomads or expatriates. You can split the rent and utilities and even share food with your new friends. It may also help with culture shock.
- If your budget is tight, look for discount grocery stores and markets that offer fresh food at lower prices and other inexpensive ways to eat.
- Explore budget-friendly local transportation options, such as bike rental or public transportation.
- Move with only your essential belongings and do the packing yourself. It may be cheaper to buy new stuff after the move than to transport your old belongings overseas.
Moving a business abroad
If you’re moving your business as well as your home, you’ll need more time to prepare as this poses a whole new set of challenges.
For one example, your moving expenses will depend on the size and the location of your new office. When preparing a business plan and setting up a moving budget, be sure to include:
- Required documents
- Legal expenses
- Renting office space
- New furniture and equipment
- Moving services
If you have employees who will be moving, too, you need to include the costs of their tickets and shipping. Have in mind that some employees may not be willing to relocate unless you cover their relocation and housing or pay them a bigger salary.
Professional movers can make your big move a lot easier. Choose a company that can handle both residential and commercial moves and let them organize everything hassle-free. To get a precise estimate, make an inventory of equipment and furniture you plan to take with you.
Commercial movers can be pricey, but you can save money in several ways. For example, booking your move early can be significantly cheaper than waiting until the last moment. Also, if you can pack your office furniture, supplies, and equipment yourself, you won’t need to pay professional packers. Most importantly, always get moving insurance to protect your valuables and cover the costs associated with any loss or damage in transit.
Choosing the right bank
Choosing the right bank in your new city before relocating will make life easier for you once you get there. Again, it is important to research your options in advance. Look for independent reviews and ratings to find the best banks in your destination country. Determine which international clearing networks these banks use, whether they issue debit or credit cards like MasterCard or Visa, and whether their ATM networks are convenient for you.
In addition, check to see whether bank deposits are guaranteed and who the guarantor is. Of course, if your current bank has a presence in your new country and you’re happy with its services, this step is much simpler.
Depending on your new destination, opening a bank account could be relatively easy. However, some countries won’t let you do it until you have a permanent residential address. If you cannot open an account before moving abroad, have your bank inform you about the required documentation so you can open an account as soon as you get there.
Saving money for moving abroad
Preparing a budget when moving abroad is all about being one step ahead. It is never too early to start saving as much money as you can for your international move. You may have to cut back on some unnecessary expenses or take a few extra shifts at work.
The exact amount will depend on many factors, such as employment and housing, but you should plan to have enough to cover a few months of living expenses after moving abroad. At least save enough money to cover your initial housing costs, including security deposits, any emergency healthcare costs, and the costs of moving back home in case you change your mind about living abroad.
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