Don’t rush complex choices
As an expatriate, you will find there are added complexities involved when managing your personal finances.
To help manage these complexities, it’s essential that you take time to consider all the factors involved and don’t rush; take the time to build your understanding and make thoroughly researched, well considered, personal decisions.
The reason why your expat situation is more complex is for many reasons.
Firstly, you will be in a new country where even the most basic aspects of managing your personal finances will be unfamiliar; simply opening a bank account can feel like an alien task.
So, the first thing to overcome when managing your finances as an expat is to bridge the gap between your current level of understanding and all the new tax rules and product options of your new home.
Secondly, there is a great deal of uncertainty over your new personal life. When managing your personal finances effectively, you should give proper weight to your unique personal situation and incorporate this into your financial decisions. Unfortunately, it is a truth that you may not stay in your new home and adds an element of uncertainty to your situation. It’s therefore important not to make decisions that could cost you if your situation were to change dramatically.
Third, you are likely to have financial products and needs which go beyond one country’s borders. At the very least, you may have some commitments, assets and income from the UK, plus some other income, assets and commitments in your new country. These factors need to be properly considered to ensure aspects such as tax, exchange rates, security and accessibility are managed effectively.
Finally, you may not necessarily fit into your new country’s social systems; be that tax rules, benefits, medical care and so forth. You therefore need to ensure that yourself and your family are appropriately protected and you don’t fall into any bureaucratic traps, issues of error or tax non-compliance, or simply fall through the gaps in safety nets. Each country has their own unique set of tax rules to be aware of and it’s important to understand where they complement or contradict with the rules applicable in the UK.
Unhelpful to your personal objectives and prosperity is the array of ‘professionals’ who are simply out to make a quick buck. Far too many advisers will be quick to move all your pensions and investments (as the more you move around, the more they earn). Some of the above considerations wouldn’t even come into their thought process; let alone would they openly discuss and consider these issues in any depth.
The conclusion you should draw is that your new found expatriate lifestyle requires some extra care and appropriate planning. It’s a truth that how sensibly you manage your personal finances will play a large part in determining how successful your expat life will be.
Take some time to consider the complexities involved. Think about your personal life now and in the future. Consider all factors involved in your personal and financial decisions, and seek help from ethical and well-regarded professionals where appropriate.
Don’t rush complex choices.