Regular Savings
REGULAR SAVING & INVESTING
For expats, the opportunities and costs related to saving and investing are significant considerations. When your income rises while your expenses decrease in a different country, you may find yourself able to save more. Exchange rate differences and tax benefits can also enhance your savings and investments.
Living abroad means navigating both home and international investment options, managing different currencies, and handling money transfers across countries.
SAVINGS ACCOUNT
A savings account is a popular choice for its accessibility and guaranteed interest. It allows easy deposits and withdrawals. While suitable for short-term savings, over time, your money may lose value as interest rates often lag behind inflation. Inflation rates vary by country, so even with good earnings, your savings might not grow significantly.
To mitigate this, consider saving in a country with low inflation, using a currency you frequently use, and focusing on short-term savings. Saving is not the only option to consider. Many expats actively invest their money as well. Investing can be done in two broad manners:
1. REGULAR SAVINGS & INVESTMENTS
Expats often invest as well as save. Regular savings and investments involve committing a set amount to various assets regularly. This approach is ideal for building a significant fund for emergencies, children’s education, or buying a house. Market conditions are less of a concern, and you can benefit from Cost Averaging, gradually building your portfolio and reducing short-term market volatility. This method is particularly useful for new investors with limited funds.
2. LUMP SUM INVESTMENT
Investing a lump sum all at once can yield higher returns, though market timing is crucial. If you have the risk tolerance and sufficient funds, this can be an excellent way to create wealth.
WHAT TO DO NEXT?
A financial adviser knowledgeable about expat financial planning can be invaluable. At LS Wealth Management, our advisers understand the unique financial concerns of expats. Schedule a call to begin your wealth creation journey.
