Behold the joys of expat life! Embark on a journey that’s part travel adventure, part cultural exploration, and a little bit of financial acrobatics thrown in for good measure.
As you discover new lands, it’s not just your suitcases that need careful planning. Alas!, there are financial smarts to brainstorm.
While the matter doesn’t really equal sipping coconut water on a sandy beach, mastering the art of getting by fabulously is absolutely crucial. Therefore, get ready to decipher taxes and flex your hidden deduction skills while enjoying your new calling of a cultural detective.
Preparing for Expat Life
The decision to become an expat marks your resolve to immerse in different cultures and broaden your horizons. Before you embark on this transformational path, brush up on your preparation skills.
Preparing for expat life calls for practicality and adaptability. First of all, you’ll need to understand the administrative part of the affair, starting with visa requirements and healthcare coverage.
No matter what your expat community tells you — there’s no seamless expat transition. Instead of brainstorming every single detail, what you need to know are the requirements and your financial limitations.
For many people, packing for expat life is more than practicality; it often comes with a zest of sentimentality. While there’s nothing wrong with packing your favorite snacks and pajamas, don’t overdo it!
Ultimately, preparing for an expat life lies in a mixture of anticipation of new experiences and practical matters. After all, it is an opportunity to evolve, explore, and enrich your life in ways you might have never imagined.
Steps to Take Before Moving Abroad
Meticulous preparation is what most expats start with, and not without a good reason. There are many things to take care of before you even set off, the most typical one of which is gathering the necessary paperwork. Just imagine the pains of acquiring a missing paper from the US administration while you’re in Cambodia.
Hence, make sure to research legal requirements, visa processes, healthcare systems available, currency conversion rates, and similar. Opening a local bank account is highly recommended, so you may want to check bank fees. More often than not, US banks charge hefty fees abroad, so look up alternative solutions (eWallets, international bank providers, virtual cards, etc.).
Finally, don’t rush housing arrangements! There are many stories about properties straight out of Disneyland advertised on Airbnb that turned into A Nightmare on Elm Street, so it’s always better to book a temporary housing arrangement and take your time finding the property that suits your needs.
Essentials for Transitioning as an Expat
Acquiring basic local language skills is highly recommended. Of course, you don’t have to acquire a degree, but knowing common localisms will help you integrate faster and find hidden gems only locals know of.
Next on, there’s cultural sensitivity to keep in mind. Depending on your target destination, cultural shock can be smaller or bigger. The customs, values and norms of your host country can be very different from those in the States. Simply put, unless you’re visiting Canada or Western Europe, you’re in for an eye-opener.
Establishing a Sense of Familiarity
The key to getting used to your host country lies in establishing a routine. Upon arrival, go out immediately and find new things to do.
Just about every city has a local market. There, you can find everything from groceries needed for cooking, to furnishings that make your home comfortable.
If you enjoy walking, find a new spot to get in your exercise outdoors. Go there in the mornings, in the evenings, or as a stress reliever whenever you need it. Walking is also a great way to see sights you might miss when using public transportation.
Managing Your Financials Abroad
One of the most important factors when it comes to moving abroad is ensuring you are financially prepared.
Set a budget after you determine the cost of living, and be sure to note other expenses. You’ll also need to be aware of how to stay in compliance with your expat taxes, which can be a big unknown for many digital nomads and freelancers.
Mike Wallace of Greenback Expat Tax Services notes, “Taxes can most certainly weigh heavily on an expat’s mind, especially with the complicated regulations and laws. However, it’s possible to use tax credits to your advantage, which can help you keep more of your hard-earned money for exploring your new home! Remember, this is the adventure of a lifetime, so don’t waste a single minute.”
Important things to keep in mind regarding expat taxes include:
- Residency rules
- Foreign income exclusion
- Double taxation agreements
- Filing deadlines
- Reporting requirements
- Social Security and benefits
- Foreign tax credits
- Expat deductions and credits
- Self-employment taxes
- Pension and retirement plans
- Tax treaty benefits
- Record keeping
- Expert advice
It may sound like a lot, but the more you learn, the bigger the chances of coming up with a winning combination. Look up those benefits and deductions and enjoy your new life!