Easy ways to boost an expat income
Top tips on how expats can make the most of their money.
According to a recent study undertaken by NS&I, an estimated six million Britons exist with no savings whatsoever. This is a terrifying statistic.
However, when you think about the number of Britons living abroad who may also exist with no savings, you’ll soon realise how much more vulnerable this group of people is.
If they lose their jobs, expats are far less likely to have any right to social support, either in the UK or abroad. (At least Brits living in the UK can still fall back on the state benefit security blanket.) On top of that, fluctuating currency conversions and low interest rates can have a devastating impact on expat finances.
If you’re living abroad and finding it hard to scrape together sufficient excess wealth at the end of the month to save into your pension or to put towards your children’s future education expenses, there are ways however you could potentially add to or maximise your income.
The vast majority of people have no idea how much they have in their bank account or wallet day-to-day or week-to-week. More worryingly, the vast majority of people don’t know what they spend in a month.
If you don’t know how much money you have and you have no idea what you spend it on, how on earth can you hope to have anything left at the end of the month to save for a rainy day?
The most basic element of money management is creating a realistic budget and sticking to it. There are budget planning tools available on the internet – or if you prefer a more traditional approach to working out what you have to spend each month, get a pen and paper.
Go through your bank statements, bills and receipts and work out what your critical outgoings are each month. These are the bills that keep a roof over your head and food in your stomach. Expats may also need to include health insurance costs, and perhaps international school fees too.
Add up what goes out on these essentials and subtract the figure from the amount you earn each month. Ideally you will have a positive number returned. This is your excess wealth, i.e. the money you have available to you at the end of the month to save for a rainy day.
If you’re left with a minus figure see our money making tips below, and revisit your budget to work out where you can make immediate savings. Your bottom line is to end up living within your means – and ideally you will manage that so well that you have excess money available to you at the end of each month to save and invest wisely for your future financial security.
2. Shop around
In the UK there are comparison websites that make it very easy for consumers to shop around for the best price on everything, from insurance to groceries, from utility bills to high value goods and services. Some expats are fortunate enough to live in countries with similar resources. If there are price comparison sites in your country, use them.
If you’re not comfortable using such sites in a foreign language or there are no such services available where you are, you can still shop around. It may take more time and effort – but if you end up saving money, the effort will have been worth it.
Going back to your budget, take each element in turn and work out ways to potentially save costs. For example, can you switch to a lower interest rate mortgage? Can you buy your groceries in a budget supermarket, or will you save more if you shop locally or buy in bulk?
Can you halve transportation costs by car sharing? Are there ways you can slash your tax bill legitimately that may be identified if you ask for advice from a local accountant for example?
Ask friends, neighbours and colleagues about who they insure with or who their utilities are provided by, and see if you can save money by switching suppliers.
3. Swap, share and barter
Swapping cold hard cash for goods and services is not the only approach available when it comes to getting the things you need. Think about the skills you have (such as English language skills for example) that you could maybe exchange for someone else’s time (to collect your children from school, perhaps).
You can also think about items you have that you no longer need, (old children’s clothes or toys maybe), that you could swap with a friend or neighbour for something like the loan of their lawn mower.
These are just exceptionally basic suggestions presented to inspire you to use your imagination.
4. Get better interest rates
It’s a well-known fact that interest rates have been historically low in the UK for far too long. Offshore savers have been equally impacted by the poor returns available on their saved wealth.
In order to ensure your savings outpace inflation and earn you a decent rate of return you will need to hunt hard for good interest rates. The larger financial advisors can often offer better interest rates to their clients on their savings and/or lower fees and charges on investments.
Do your research carefully, and ensure any savings policy or investment approach suggested is truly suitable for your objectives, tax status and risk profile.
5. Give language lessons
You don’t have to be a qualified TEFL teacher to offer your language skills for hire on a part-time basis. You may well find that a colleague, a neighbour or a friend will pay you to help them improve their English. Or perhaps you can organise an English language conversation evening and invite even more participants?
Alternatively, if your local language skills are strong, what about offering some translation services?
Look for opportunities to use the skills you have to make a little bit more money each month.
6. Offer relocation services
Having moved abroad, successfully integrated and established a brand new life overseas for you and your family, you have in-demand skills. Those who want to achieve the dream life that you’re already living will possibly pay you to give them relocation assistance.
You can set up a website, advertise on forums or related expatriate websites, or even directly approach companies recruiting foreign workers and offer to help them.
Think about how your experience as an expat is potentially of most value.
7. Set savings goals
If you have no idea what you would like to save money for, you are much less likely to bother putting cash aside each month. According toLoveMoney.com, setting a savings goal is a big psychological plus in favour of you actually achieving that goal.
If you know where the money will be spent eventually, or you know how your savings will protect you in the future, it will be far easier for you to set your mind to the task and ensure that you do put some cash aside each month.
Setting savings goals can be enjoyable too, particularly if you’re saving to buy a house, get married or perhaps start a family. Make the fourth step towards greater financial security, and set savings goals to inspire you to put money away as often as you can.
8. Be a tour guide
If you live in a tourist destination, why not combine the fact that you speak English, know the lay of the land and probably know where all the best bars, restaurants, shops and sites are, and in so doing offer your skills packaged together as a tour guide.
You can advertise in the hotels and guesthouses locally, or go on travel websites, social networks and forums and directly promote your services.
You can work at the weekends or during your holiday time, so that this additional revenue stream doesn’t impact your main job.
9. Profit from your travels
Whether you’re a well-travelled expat or you just know your new nation inside out, have you ever thought of writing about and photographing your travels and adventures? You may be able to sell words and pictures packages to travel or airline magazine.
There is a huge amount of competition in this area so you are well advised to find a niche and specialise in it. For example you could write specifically for a given demographic or age group such as budget travellers or retirees, or you could focus in on a niche element of a given country’s appeal – e.g. its mountains or cuisine.
10. Rent and sell
The final idea for revenue generation is all about renting out or selling that which you no longer utilise or need. For example, why not turn your home into a shared house by renting out any additional bedrooms which are not in use?
Alternatively you could set up a bed and breakfast business – or if you live in a town or city, what about renting your garage or parking space out for a premium each month?
Go through your attic, cupboards, storeroom and cellar space and be ruthless – find all the items you no longer want, need or benefit from and which you can well live without. Now sell anything of any value.
You will create instant profit and free up space that could perhaps be put to better use.
Nothing of any value in life comes particularly easily, which is why all of the above tips require input, energy, thought and commitment from you. However, when you start saving and even perhaps earning more money you will literally reap the rewards very quickly.
Rhiannon Davies is editor of Shelter Offshore, the online financial and lifestyle resource for expatriates and those planning a new life abroad.