Moving to a new country will be a major turning point in many people’s lives. Even the thought of moving to a new culture, taking up a new job opportunity, and making lifelong friends will seem exciting to you. However, you need to be practical and create a financial plan for relocating to a new country, which won’t be an easy thing to do.
Planning for an international move can be a stressful and confusing process. Let’s identify some of the most important elements that need to be considered before you create a financial plan for your relocation:
1. Research the cost of living in the new country
The Internet will be the easiest way to research the cost of living for most countries. You will come across multiple travel bloggers who write about how much they spend in moving to different countries.
Also, you can check grocery stores and restaurant menus online before moving to a new country. You can comprehensively research the real estate portals and get access to every type of place to live in the new country.
The budget for moving abroad should be based on your destination country. There will be many places with modest living costs and outstanding culture, for example, Thailand, Mexico, and Hungary. While places like New York, Paris, Tokyo, and Copenhagen are iconic and the world’s most costly cities.
2. Passport and visa expenses
To move internationally, you will need proper documents, like a passport and a visa. If you don’t have them, you need to apply for them in exchange for a fee. The charges may vary from country to country, however, you can expect to pay something around $140, which will be the cost of getting a new passport in the United States.
In case you already hold a passport, carefully check its expiry date. If it’s expiring while you will be abroad, it’s recommended you renew before the relocation itself.
The visas will depend on your destination country and the reason for your relocation or visit, whether you will be moving for a job, education, or simply for living there. The fees for each type of visa application will be different.
You need to check whether your visa needs any proof of income or funds or not.
Here’s a list of a few important information for you:
- Regardless of whether you need a visa for permanent immigration or stay, a few countries will require you to have savings in your bank account. This is known as the proof of funds. For instance, if you need a visa for Canada, you will have to give proof of funds to each of the family members and yourself.
- If you are a digital nomad, you will need to present proof of funds or income proof. Having such statements will ensure that you have sufficient money to support yourself as well as contribute to the local economy of the new country.
- If you are relocating to Hungary you need to provide an income statement of around 2,200 USD each month. If you are moving to Iceland you will have to show an income statement of over 7500 USD each month.
Make sure you do enough research on these factors as this needs to be included in your overseas relocation budget.
3. Flights and travel expenses
Travel costs change significantly based on the distance you will be moving. One of the biggest expenses you need to bear will be the cost of your flight ticket. It’s recommended you research a bit and find the best deal for your flight tickets and other travel arrangements.
If you have access to frequent flyer miles, you must redeem the points and reduce your expenses as much as you can. Also, you must consider the cost of your checked bag while estimating the cost of moving internationally. Many airlines will charge you a hefty amount for the checked baggage which will add up to even more if you have multiple checked luggage.
4. Shipping expenses
If you are bringing all the belongings on a flight with you, then you need not worry about the shipping costs. This will include both the checked baggage as well as the carry-on baggage. However, if you are shipping household items to a new country for a long-term stay, then you must consider the shipping costs while making the budget.
You will have two shipping methods to ship your belongings, first by air freight and second by ocean freight. You need to choose the most suitable option based on your budget, needs, and timeline. For example, if you don’t have enough time you can go with the first option, however, this will be expensive. On the other hand, if you want to reduce the expenses, you should go for the latter option, however, it will take quite a long time for your belongings to arrive at your new destination.
5. Housing costs and accommodation
Housing costs are one of the most important factors in calculating the budget, regardless of the move type. Here’s what you may need to consider:
- Consider the hotel accommodation cost, if you think your new house won’t be ready to move in, until the time you relocate to the new country. This will increase your overall budget.
- You may need to pay a security deposit if you want to secure your new house in the new country. This may include advance rent or any other fees that you may need to pay before relocating to the new house.
6. Consider the cost of the lifestyle you want
Some expats will prefer to adopt a budget-friendly lifestyle while living abroad. Usually, a digital nomad or a retired person will prefer a country with low living costs, others may want a lifestyle the same as their home or have some additional luxuries in the new country.
Here’s what you must keep in mind while determining the cost of your lifestyle:
- Don’t consider the cost of visiting home, while living in another country for the long term.
- If you need to visit your house two or three times a year, it’s recommended to include such expenses in your budget.
- Adjust your lifestyle in the new country, if you want to keep your lifestyle-related expenses under control.
7. Healthcare expenses and insurance
You will need to choose your healthcare or insurance plan based on the destination country. If you are a digital nomad or if you will be traveling on a job visa, you will need to prove that you have health insurance.
Having health insurance will reduce your moving stress considerably. Also, having access to a quality healthcare plan will keep your stay abroad safe and secure medically.
Moreover, if you have travel insurance, you will enjoy extra support against emergencies and thefts.
Tip: Find a good insurance service provider as they will help you with a coverage plan, which is suitable for your budget.
8. Prepare for the emergency fund
By preparing for an emergency fund, you will keep yourself covered for an unfortunate event.
- You need to question yourself, what kind of an emergency may arise while you relocate to a new country.
- If you opt for a high-deductible insurance plan, some of your medical care expenses and losses due to theft would be covered.
- If family is your priority, keep funds for a flight ticket, which you may need any time to go home in case of an emergency.
Overall, creating a budget for moving overseas will help you draw a picture of your life in the country. You will come to know about many new things, which you might have never expected in your life.
By getting to know things you can enjoy in your new life in the new country, you will be inspired to save the money you will need for the same.