Did you know that Angola is the most expensive country in the world to rent property, or that India is the cheapest country to do your grocery shopping? If you’re thinking of moving to another region, these are some of the details you need to know so as to settle down well. It’s important to prepare yourself for the living expenses of your favoured destination in order to maintain something close to your usual standard of living away from home.
Cost of Living Calculator
There are a number of calculators online available for you to use for free. You only need to key in your current expenditure and/or salary and country of residence, then the name of the country you intend to relocate to. The calculator will give you an approximate figure of how much you need to make in your preferred destination in order to maintain your standard of living. Furthermore, online calculators take into account factors such as exchange rates and taxes.
Other Online Resources
As cost-of-living is a constantly changing factor, you need a reliable online platform that is frequently updated for accuracy as it proves to be an invaluable resource. Websites such as the Economic Intelligence Unit and numbeo.com provide you with cost-of-living indices that help you correctly determine how much various commodities cost across different countries in the world. These exact figures enable you to budget aptly for the place you intend to go to and keep track of any changes that arise.
Determine Fixed Costs vs. Flexible Costs
While the Cost of Living Calculator gives you a basic figure to work with, looking at specific expenditure items is important for long-term budgeting. Flexible costs, otherwise known as ‘soft costs’, such as groceries, transport, gas, entertainment, are those without scheduled payments and are variable with changing needs. Nevertheless, once you settle in your new country and get used to the spending habits, you’ll be able to apportion money appropriately for them and maximise on savings.
Fixed costs such as rent, mortgage and insurance premiums are committed, with scheduled payments. These are easy to determine, and cut down cost on and even pay for upfront before travelling to your preferred destination.
In Case of Emergency
Even with insurance and savings, an unforeseen incident like theft, illness or loss of income could incur heavy costs and bring about losses, marring any progress made in your relocation. Ensure you have an emergency fund or access to financial resources to cushion such occurrences. The fund could cover a period as short as thirty days or as long as six months.
Review and Future Planning
Just as you may already be doing in your current country of residence, make sure to always review your financial records on a weekly or monthly basis. These will help you project expenses for the next year.
When doing your calculations, remember to include all your anticipated expenses in your budget. You can use a spreadsheet to aid you. Budgets must be written, relying on your memory can easily deceive you.
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