5 Ways Expats Can Maximize Their Savings

by Pam on July 13, 2012

Living as a foreigner can be daunting at times.  You face culture shock and you become exposed to all sorts of things that differ from your home country.  You will be sure to find some of what you experience to be fascinating, while other things may horrify you.

Depending on where you live, you may face greater living expenses and miscellaneous expenses than you first anticipated.  Below are five tips you can follow to help you maximize your savings while living as an expat.

1.  Plan ahead.  Before heading out to live in a foreign country, make sure that you have adequate money set aside in the event of an emergency or in the event that unexpected expenses arise.  I recommend setting up a bank account that you can access from your destination country. Use an international bank for instance, as international banks offer many perks over domestic banks.

2.  Get Insurance.  Some people will tell you that you don’t really need insurance, but I strongly recommend that you get adequate health insurance.  Although it may seem expensive, you will save a lot of money if something were to happen to you while you are living in a foreign country.  People never expect to get sick, but it happens to many who travel abroad.  And accidents can happen, too, so you need to be covered.

3.  Pay attention to exchange rates.  If you are sending money back to your home country on a regular basis, pay attention to the exchange rates and be sure to send your money when it is most advantageous to do so.  That way you will be able to save more money rather than lose it during a currency exchange.

4.  Understand your tax responsibilities.  Before heading out to live in a foreign country, talk to a reputable accountant about your responsibilities to pay income tax in your home country.  Also, if you are working in a foreign country, make sure you abide by their income tax rules as well.  If you plan ahead and strategize with your accountant, you may be able to cut ties with your home country to the extent that you become exempt from having to pay income tax.  This could result in a great deal of extra money in your pocket.

5.  Use your foreignness to your advantage.  Because you are a foreigner, many people will be interested in speaking to you and understanding your culture.  Turn this curiosity into a way to make extra pocket money by offering language tutoring, cooking classes, or whatever else is of interest to your newfound friends and acquaintances.  You might be surprised at how many people will be interested in learning about your country and culture.

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