For those ready to stake their claim in the U.S. as expats, there’s plenty to be excited about.
Job opportunities. A whole new culture. The list goes on and on.
That said, those moving to the United States need to be mindful of their money both before and after they’ve arrived on American soil. Although you may not be new to the world of budgeting, there are some particular financial needs you should consider as an expat.
But what sort of needs are talking about? We’ve outlined seven budgeting tips to keep your finances in order while you’re abroad regardless of where your destination might be.
Sort Out Your Financial Affairs at Home
Many expats get so laser-focused on making and saving money while abroad that they accidentally neglect their financial commitments at home.
For example, sort out each of the following in terms of your budget and expenses prior to settling down:
- Remittance payments to family back home, which might be your reason you went abroad in the first place
- Subscription-based services such as that of your cell phone or any sort of streaming services you won’t be using anymore
- Big-ticket payments such as that of your car, mortgage or financial investments which may need to be paid forward or handled by someone at home
Understand Your Currency
Dealing with a new currency can initially be confusing, but it’s certainly easier than it be thanks to mobile banking and the smartphones.
Having access to an exchange rate calculator and apps which convert currencies for you are both game-changers. If possible, try to find a local bank that’s friendly to expats so you can actually talk to someone about your money versus solely relying on online banking.
Rethink Your Living Situation
Obviously having a dedicated address is essential but also consider that housing can quickly eat into your budget.
Following the debated “golden rule” of 30% that says you shouldn’t spend more than 30% of your income on housing is an option, but might be a bit of a burden. Consider other ways to save on lodging such as sharing a space with fellow expats or living with family abroad, if possible.
Either option is way cheaper than renting a one bedroom apartment. Likewise, such arrangements can help you battle the phenomenon of expat loneliness.
Consider Your Transportation Options
Having your own vehicle might be convenient, but it’s also a major financial burden.
Driving classes and testing fees. Car payments. Insurance.
See how that adds up?
Consider some smart alternatives to owning a vehicle that’ll save you money such as…
- Public transit: if you live in a big city, chances are you can find a reliable bus route or metro rail
- Biking: similarly, most big cities accommodate bikers by providing plenty of paths and parking
- Carpooling: if you’re able to connect with fellow expats, you can hitch a ride for long distances
Again, it’s all about doing your homework beforehand. The ideal situation is to move to an area that is friendly to pedestrians, which most metro areas are. As an added bonus, many of these same big cities are also welcoming to expats.
Mind Your Health Insurance
If you go without health insurance in the United States, you’re taking a massive risk. While high healthcare costs domestically are difficult to deny, the costs of care when uninsured are almost unfathomable. The risk simply isn’t worth it as a catastrophic incident could not only hurt you physically, but also cripple you financially and force you back home.
Whether it’s international insurance or something through your employer, assess your options. Connecting with other expats is another good way to sort this out, but make sure you figure it out beforehand.
Find Smart Savings on Food
Although you probably already have a pulse on how to be frugal when it comes to food, bear in mind that the cost of eating out does add up in the States. Meal prep and cooking in bulk are smart moves if you’re saving to send money back home, for example.
Also, be on the lookout for specialty grocery stores if you can’t find the ingredients you’re looking for. You may need to talk to fellow expats if you’re homesick for some local flavors. That said, even most big box stores have an “ethnic” aisle which might surprise you.
Save When Staying in Touch
Technology is certainly a huge help when it comes to staying in touch, but it’s also a great way to keep more money in your pocket. For example, don’t even think about dealing with international calls and fees when a simple Skype call can do the trick. Likewise, social media platforms like Facebook allow you to emulate apps like FaceTime without spending a dime.
The United States has always been regarded as the land of opportunity; however, you still need to be savvy about savings and spending if you want to make it here long-term. Hopefully these tips can paint a good picture of what you should expect in terms of your finances and changes you might need to make before your big move.