The Real Cost Moving Abroad has on Your Financial Plans

caspian_blog.png

I recently had an annual review with one of my clients Tiago who shared something we hadn’t previously spoken about. His move to the UK.

Six months before we spoke Tiago had moved from Portugal to the UK. It was an interesting process for him to say the least even if the move has generally been a great success. It’s been a really rewarding time for him and to anyone thinking about it, he’d highly recommend a move abroad.

Having had a good chat about his moving experience I want to help you integrate a move abroad into your financial plans as well as what to look out for.

The Cost of The Move

The first (and most obvious) factor to consider is the cost of the move itself. This may seem relatively easy to plan for... flights, insurance, a moving company for your items etc... But how much will it cost you to get set up in your new home?

What if the moving company ends up delivering all your furniture two months late (as they did in Tiago’s case)? If something goes wrong, can you afford to cover yourself until it’s fixed? Always leave a little wiggle room in your moving budget for the unexpected.

The New Cost Of Everything

The next thing to consider is the difference in costs between your new country and your last.

When Tiago moved from Portugal to the UK he knew everything was going to be more expensive, but he was not prepared for how expensive it is! Your living costs may increase or decrease in different ways, and your spending habits may need to adjust to reflect this. If you have a new job lined up in your new country, your income may also be higher or lower. On top of this, there will be different taxation rules. How will these factors affect your disposable income?

As much as possible, research the day to day living costs of your new country and familiarise yourself with how far your money will stretch in your new city.

The Additional Costs

Although it’s important to prepare for them, don’t worry about every cost that will spring up along the way.

There will be many. Some big, but most will be small. In Tiago’s case he completely overlooked the possibility that he may get homesick and want to fly home to Portugal a few times a year. It’s something we now factor into his financial plan, and that he saves for every month.

Do your research but don’t stress

The good news is that with a little bit of preparation and research, you should be able to forecast how much you need to be able to afford to move and settle into your new country. NomadList is a good place to estimate the costs of living in different countries.

The best advice I have is to save up an emergency fund on top of your budget to protect yourself if things go wrong - and things will go wrong.

The truth is things will never go exactly to plan... but isn’t that part of the excitement?

This is what makes moving an amazing experience, so make sure your plan saves you the stress of worrying about the financial aspect of the move, so you can focus on all the fun bits.