- Date : 09/05/2022
- Read: 5 mins
We would suggest getting a rough number for the overall monthly expenses in the new country and doubling that as a buffer until you find employment. Add the airfare and visa fees to the above number to get an estimate of what you should save.
Do you dream of moving overseas to boost your career? Oftentimes people do it for education or in search of better career opportunities. You might also just want a change of environment and want to explore a different part of this big world.
The reason would vary but there are some ground rules to keep in mind before taking this big step in your life. Although it is impossible for you to be prepared for every single circumstance you will be more resilient to these situations by planning ahead. This blog post aims to cover the important aspects to plan your finances for the big move.
The expenses have been categorized to make things easier. Please note that these numbers are highly dependent on the nation and region you are planning to move to.
Expenses back home
If you are moving for a short period of time chances are you would want to keep your current house and belongings. Or you are unsure of the duration but would like to keep your house and belongings. This means you would need to continue paying your mortgage payments, rent or storage. However, things will be different if you are moving for education.
Taxes for NRI (Non-resident of India) is also something you would need to plan for. The Double Taxation Avoidance Agreement allows NRIs to pay tax to only one country to avoid double tax payments. This is especially important if you are leaving income sources in India. You might end up paying taxes to India and the country of residence on the global earning accrued.
Exemption from taxes, lower withholding and tax credits are some key benefits. The guidelines differ from country to country according to the treaty signed by both countries. You can find more information about this on the Income Tax India website. (www.incometaxindia.gov.in)
Moving expenses can be a one-time expense if you are planning to settle down in a new country. It can also be recurring if you are embracing the nomad lifestyle.
This includes the fees to apply for a visa, airfare, and accommodation.
Again, these are variable from country to country depending on the economy and other factors. Hence, you must research the fees to accommodate this in your budget.
Try to carry minimum luggage including only the essentials as most airlines will allow only up to 2 pieces. Any extra luggage is usually charged per kg. If you are planning to move furniture or large items, see if you can sell or donate those to avoid shipping costs. In most cases, it would be cheaper to replace the item than to ship it.
Shop around well in advance to get cheaper deals on airlines and accommodation.
Cost of living
Accommodation, transport, food, utilities, etc are recurring expenses you will need to plan for before you even buy the air ticket. Facebook groups or local marketplaces are a great game-changer to get the current numbers.
You can also use tools like Nomads or Numbeo to get a general estimate for the monthly costs.
Save up for an emergency fund to help you with the bills if you don't get a job right away.
How to Save money-Tips to save more
Write down the things you need to save up for and create a budget. A budget will help you stay on track with your financial goals and save more. Rent out your house in India for additional income which can be used towards your loan payment. You can also cut out your unnecessary expenses so that you can use the money for the move instead.
Also Read: 5 Ways to Make Saving Money Fun
Be mindful of eating out and cooking at home instead to increase savings. If you have investments like PPF(Public provident fund) or a National Savings certificate, consider withdrawing the funds and closing the account to avoid taxes in India. You can do so online or by filling out a form at the local PF office.
Financial aid like scholarships could be a great option if you are planning to move for education. Educational loans are a convenient option if you anticipate working there after graduation.
How much should you save for moving abroad?
It is nearly impossible to cough up a specific number that works for everyone. We would suggest getting a rough number for the overall monthly expenses in the new country and doubling that as a buffer until you find employment. Add the airfare and visa fees to the above number to get an estimate of what you should save.
University fees for a Masters's program are usually expensive. You are expected to have a set amount in savings in your country of origin to prove to the government that you can afford your bills and will not be homeless or cause trouble.
Conclusion- Leaving your home country for another is difficult financially and emotionally. The process might be lonely and tedious at times but a great learning experience nevertheless. Use these tips to plan ahead for this next great adventure.