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Moving abroad is one of the most exciting things anyone can do! Whatever your reasons for deciding to emigrate, it’s an opportunity to immerse yourself in a new culture, experience a new lifestyle, and learn more about yourself. One of the biggest learning experiences can be managing finances when moving abroad. My husband and I once backpacked through the Greek islands and weren’t so savvy on currency exchanges and fees. We ended our 10 day trip with literally 23 cents to our name by the time we reached the Chicago airport waiting for our last leg to our hometown airport.
Whewwww, it was close!
There are many potential financial pitfalls that you need to avoid if you want your move to another country to be a positive experience or even just traveling for a vacation.
Research exchange rate
Unless you happen to be moving between two countries in the Eurozone, you’ll have to exchange your money into the currency of your new country when you move. This is known as Forex Trading. When you move to a new country, you’ll likely have to exchange most – if not all – of the money you own. Because of this, make sure you shop around for the best possible exchange rate. Rates can differ wildly depending on where you go, and if you just accept a poor rate without shopping around, you’ll lose some of your hard-earned money. My husband and I are proof of that! (Thank goodness the airlines were serving food on the flights we were on!)
Don’t close all your bank accounts at once
Once you’ve moved to a new country, the temptation can be to close down all your old bank accounts and credit cards in one go. While it may seem convenient, this is a bad idea. Doing so could significant damage to your credit score, damage that could take you years to fix. Instead, you should close down the accounts slowly over many months. You should also keep one account from your home country open. Most importantly, you never know when this might be useful. For example, if you need to head back home urgently for a couple of days, having your old bank accounts open will be very useful, as you won’t have to exchange currency when you arrive in your home country. According to Forbes, “The average emergency medical evacuation costs can set you back $25,000 within North America and up to $100,000 from Europe, according to estimates by Travelex Insurance. In more remote locations, a medical evacuation can cost as much as $250,000.”
Research Health Insurance
Chances are, when you initially move abroad you’ll have to get some form of health insurance. Many countries require all inhabitants to have valid health insurance, which is especially vital in countries like the USA, where no state-funded healthcare is accessible. Even in countries with state-provided healthcare, new arrivals may have to take out a health insurance policy. Do some research on the country you’re moving to, and find out if you need to get insured. Even if you are planning a temporary residency, you need health insurance and might want to consider evacuation insurance as well in case you face a catastrophic injury or disease and need to be evacuated to your home country. According to Forbes.com, “The average emergency medical evacuation costs can set you back $25,000 within North America and up to $100,000 from Europe, according to estimates by Travelex Insurance. In more remote locations, a medical evacuation can cost as much as $250,000.” If you don’t research health insurance ahead of time, you could rack up some nasty bills when you need to use medical services and/or emergency services. Not all travel insurance includes this and might be dependent on what activities you will be participating in, so make sure this is spelled out and understood before selecting your policy.
Research Residency Requirements
Will you need a visa? Will you need proof of employment that is waiting for you? Will you need a sponsor? These are just some of the potential things that need to be in place before moving. Be sure to research these types of requirements and also any required vaccinations or medical things that are required. And if you are planning to bring your pet(s) be sure to check requirements for them as well. Visit Expatica for the Ultimate Moving Abroad Checklist.
It might seem like an obvious tip, but budgeting will help you save money after you’ve moved to your new home. With moving abroad, there’s the added complication of the currency exchange, and a different economy meaning that your day-to-day purchases will have different costs. A little research into how much you’ll expect to spend each month when you move to a new country can go a long way. Many ex-pats move countries only to find that their new home is much more expensive than they’d expected or inflation has recently taken hold, leading to an austere first few months financially. Plan ahead, and you’ll be able to get out there and enjoy your new city, safe in the knowledge that you’ve budgeted properly.
Moving abroad takes a bunch of planning from picking your new location, jobs, finances and more. Try out these tips for managing finances when moving abroad are a great start for planning your new adventure. I wish you great fun and new found magical places!
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