The New Year is a new opportunity to get a strong grip on your financials. As an expatriate, there a certain things you can do to put yourself in the best position for 2018 and beyond. Whether you’re living east, west, north or south of your home country, these 4 things can help you start the year off strong.
1. Understand International Agreements
It’s the New Year! Time to finally start focusing on your health financial health that is! As an expatriate you may be subject to paying taxes two times; once in your home country and once in the country which you are living. Luckily, some countries have tax treaties. These tax treaties prevent you from paying taxes twice and save you tons of money. In addition to Double Taxation Avoidance Agreements, countries sometimes enter in Social Security Agreements. These help expatriates who have worked enough quarters to qualify for social security in total but because those quarters are split between two countries, they do not qualify for either on their own. Social Security Agreements account for this and grant benefits proportional benefits to those who have contributed to social security enough quarters to be considered. Speak with your financial advisor to see if Double Taxation Avoidance Agreements or Social Security agreements can improve your financial situation.
2. Monitor Exchange Rates
For the last month, all you’ve been doing is shopping. Well, it’s time to do more shopping. Shopping exchange rates can save you money in the long term. Those small percentage point differences add up. Not all exchange centers are the same. Some have high rates. Shop around for one with a great rate. A good place to start for currency exchange is your bank. They may be the best option.
3. Start a Savings Plan
Cliches aside, the New Year’s allows us to prioritize our goals and act on them to achieve them. Many expat’s goals are to save college tuition for their children. If this is something you want to eventually achieve, then start saving right away. Saving a small amount each month can have a great effect later on in your plan. You’ll also want to save based on school plan. Private, nonprofit colleges tend to be the most expensive, and require saving $500 per month. Public, out-of-state state schools require $400, and public in-state schools require $250 per month. Besides saving monthly minimums, one savings ‘hack’ is to take half of big ‘hauls’ and place them into a savings account. This could
be a bonus from work, an inheritance, or a tax return. On a similar note, keep an eye out for ending expenses such as a car payment (or anything that no longer incurs) and redirect those into savings funds. Speak with your financial advisor to set your savings plan up for success.
4. Take Care of Your Estate
Planning your estate may have been something you were putting off. With the New Year’s coming, now is a good time to get started. Everyone has an estate. Some estates are bigger than others (and those require more time to plan) but small estates need planning too. It’s important to plan your estate because the fallout of not doing so is a mess. You will save your loved ones time and money if you plan while you’re around. Planning your estate lets you specifically choose your beneficiaries. Furthermore, planning allows you to prepare for taxes and gives peace of mind. Speak with your financial advisor today to put together a strong plan for your estate.