Moving country is exciting but daunting. There’s a lot to do, and it’s easy to overlook financial planning essentials in the whirlwind of settling in. But the first 90 days are crucial for laying the foundation of your financial future as an expat. Here’s how to make sure you start off on the right foot.
Financial considerations when you move country
Relocating is a crazy time. Between finding a place to live, navigating a new job, and adjusting to a different culture, your finances might take a back seat. However, as you settle into your new life, it’s worth taking the time to understand how things have changed on the financial front and whether you need to make any changes (spoiler alert: you will!).
You are probably stepping into a completely new financial environment with different tax systems and banking practices, and living costs may vary dramatically from what you’re used to. Laying strong financial foundations early on can help you avoid costly mistakes and give you greater peace of mind as you settle in.
If you’re feeling overwhelmed by everything there is to do, we’ve produced this step-by-step guide of financial considerations. Over the next 90 days, you can work methodically through the list and ensure that you have all aspects of financial planning covered to effectively support and protect your family as you get accustomed to your new lives abroad.
- Open a local bank account
While most expatriates benefit from the convenience of international offshore banking services, you’ll almost certainly need a local bank account for everyday use. Ask around local expatriate groups for recommendations of banks and open an account to facilitate the payment of local bills and day-to-day purchases.
- Revisit your budget
You will no doubt have done plenty of research on the cost of living in your new home before making the move, but you’ll get a much more accurate picture once you are actually on the ground. Take some time to update your monthly budget to reflect your new day-to-day reality and costs, including rent, utilities, food budget, education costs, and insurance.
- Set up a currency exchange account
If you’re regularly transferring money between countries, it makes sense to use a currency broker. You’ll get better rates than through standard banks and this can make a huge difference on larger transactions. If you’d like to save money on your foreign exchange transactions, we can help.
- Research tax obligations
Your obligations will vary depending on your residency status and your home country’s tax laws.
For example, US citizens are required to file annual tax returns with the IRS regardless of where they live or where their income is earned. They may also be required to report foreign bank accounts and assets via FBAR and FATCA.
UK nationals living abroad, on the other hand, are typically only required to file with HMRC if they are UK tax residents. Once they are classified as non-resident for tax purposes, they usually only pay UK tax on income arising in the UK (e.g., rental income or UK-based investments), and not on their foreign income.
You’ll need to familiarise yourself with the double taxation agreements that exist between your home country and your host country, and ensure that you are filing correctly to be compliant.
It’s a good idea to consult a cross-border tax adviser soon after your move to ensure you understand your obligations, but also so they can help you optimise your finances with tax-efficient savings and investments.
- Get health insurance
Many expatriates and their families have health cover included as part of their employment package. It’s worth assessing the policy to work out whether it is comprehensive enough for your needs or if you may need a top up.
Whatever you do, don’t be tempted to skip health insurance altogether. You never know what life has in store for you, and if you or a family member becomes ill unexpectedly without cover, you could be looking at eye-watering bills. A comprehensive medical policy could even save your life.
- Review your life insurance
A move abroad can impact your existing life insurance policies, so it’s important to check whether your coverage still applies. In many cases, relocating to another country will invalidate a policy, particularly if it was tied to your home country’s residency or employment. To ensure your loved ones are protected, you may need to take out a new policy that reflects your current situation. Consider factors such as your revised cost of living, new income level, and the potential costs of repatriation or cross-border family needs in the event of your death.
- Plug other insurance gaps
For a rock-solid financial planning foundation, you should also consider critical illness cover and income protection. Although many expats don’t have these policies, our consultants know from experience how they can really make a difference to families in stressful financial situations due to unexpected illness.
- Review your retirement plan
Relocating abroad is a good moment to reassess your long-term retirement strategy. Your existing investments and pension arrangements may no longer be tax-efficient or even accessible in your new country of residence. As an expatriate, it’s important to determine whether your current retirement plan still aligns with your financial goals and legal obligations.
Our knowledgeable advisers here at Infinity can help you explore the retirement savings options available to you. This might include contributing to a local pension scheme, using international retirement plans designed for mobile professionals or maintaining contributions in your home country (if allowed). The right solution will depend on your residency status, long-term plans, and tax implications in both jurisdictions.
Infinity has over two decades of experience advising expatriates in Asia, and we can help you structure your retirement savings in a way that maximises flexibility, minimises tax exposure, and protects your future.
- Clarify long-term goals
Financial priorities frequently shift when families relocate, so it’s essential to revisit your long-term goals and ensure they remain relevant and attainable. Whether you’re planning to stay overseas indefinitely, return home eventually, or move on to another country, your financial strategy should support those ambitions.
Take time to assess how your new circumstances affect key goals such as retirement age, property ownership, children’s education or early financial independence. Align your savings, investments, and insurance plans with your new life plan and avoid short-term thinking that could undermine your future objectives.
- Review your emergency fund
An emergency fund is essential wherever you live, but as an expat, it’s even more critical. Unexpected events like a job loss or medical emergency can be more complicated and costly when you’re abroad.
Review your existing emergency savings to ensure they are adequate for your new cost of living. Ideally, you should have six months’ worth of essential expenses set aside. Consider where the funds are held: it’s wise to keep part of your emergency fund in your local currency for quick access and part in your home country for added flexibility or repatriation needs.
- Reassess estate planning
Legal systems vary widely, and what worked in your home country may not be valid or effective in your new one.
Start by updating your will and beneficiary designations to reflect your current residency and any new assets acquired abroad. Local inheritance laws may differ significantly – some countries have forced heirship rules or restrictions on foreign ownership – so it’s essential to understand how your estate would be handled under local regulations.
Also, consider putting in place powers of attorney and medical directives that comply with local law. These documents ensure that someone you trust can make decisions on your behalf if needed.
Seeking advice from a legal expert familiar with both jurisdictions can help you coordinate your estate plan across borders and avoid costly legal complications later.
- Seek professional advice
Why muddle through your financial planning in a new country when you can access professional advice on everything from health and life insurance to pensions and education fee planning from friendly consultants who have experience of helping other expats in the same situation as you?
Consulting a professional brings peace of mind and will set you up for long-term financial success in your new home.
If that sounds good to you, we have advisers across Asia who are ready and waiting to help. Get in touch today and make the most of your new life abroad.
A leading provider of expat financial services and wealth management services across Asia.
