How to Save While Living Abroad

Apr 2, 2025

How to Save While Living Abroad blogpost image

Building a Strong Financial Foundation

Moving abroad presents exciting opportunities, but it also comes with financial challenges. Just like constructing a house, building wealth requires a strong foundation. Without one, your financial future can become unstable. Saving is the cornerstone of this foundation; without disciplined savings, long-term financial security is nearly impossible.

Understanding Your Budget: Clarity is Key

Before diving into saving strategies, it’s crucial to understand your financial landscape. Many expats overlook this step, leading to overspending and financial uncertainty. The first step is to be clear on your incomings and outgoing – track your salary, side income, and any passive earnings while keeping an eye on regular expenses such as rent, utilities, and daily living costs.

“A budget tells your money where to go instead of wondering where it went.” – John Maxwell

Take advantage of online banking tools and budgeting apps to track your spending habits effectively. These tools help create clarity and ensure you live within your means.

 

Mother and child at a cashpoint

The Golden Rule: Pay Yourself First

One of the biggest mistakes expats make is saving whatever is left at the end of the month – often, that means saving nothing at all. Instead, flip this approach: pay yourself first.

Warren Buffett famously said, “Do not save what is left after spending, but spend what is left after saving.”

This principle ensures that saving becomes a priority, not an afterthought. Set up an automatic transfer to your savings account each month before you start spending on discretionary items.

Currency Considerations: Keep Your Savings in GBP

Many expats make the mistake of stockpiling savings in the local currency. While this might seem convenient, fluctuations in exchange rates can significantly impact the value of your savings. Instead, it’s wise to keep your long-term savings in GBP or your home currency, ensuring consistency and avoiding losses due to currency depreciation.

The Hierarchy of Financial Needs

Think of financial planning as a structured hierarchy. Before making high-risk investments, ensure you’ve covered the basics:

  1. Emergency Fund:
  2. Your first priority should be creating an emergency fund with 3-6 months’ worth of expenses. This acts as a financial safety net in case of unexpected job loss, medical emergencies, or other unforeseen costs.
  3. Short-Term Savings: Once your emergency fund is in place, focus on saving for short-term goals such as travel, education, or property deposits.
  4. Investments: Only after securing the basics should you look at investment opportunities to grow your wealth over time.

Why Many Adults Struggle to Save

Studies suggest that around 56% of adults have only enough savings to cover one month’s worth of bills. This financial fragility is particularly concerning for expats, who often lack a strong social safety net abroad. Avoid falling into this category by making intentional savings a habit.

 

Happy couple on laptop with sorted finances

Smart Saving Strategies for Expats

  • Automate Your Savings: Set up an automatic transfer to your savings or investment account.
  • Use Online Banking Tools: Many digital banks offer budgeting features to track spending and savings goals.
  • Redirect Savings from Reduced Expenses: If you’re no longer paying council tax abroad, consider saving the equivalent amount each month instead of increasing your spending.
  • Keep a Separate Account for Savings: Mixing savings with daily spending accounts increases the temptation to dip into them.
  • Explore Employee Benefits: Many companies offer staff savings schemes as part of their employee benefits package. These schemes automatically deduct savings from your salary before you have a chance to spend it, making them an excellent way to build your savings effortlessly. Check with your employer to see if such options are available to you.

The Bottom Line: Saving Smart While Living Abroad

Expat life comes with financial complexities, but with the right mindset and strategies, you can build a secure financial future. Prioritise savings, stick to your home currency, establish an emergency fund, and leverage digital tools to manage your finances effectively. By taking proactive steps, you’ll not only safeguard your wealth but also create long-term financial freedom while enjoying the benefits of international living.

Is your money working as hard as it could be?

Take our free Financial Health Check A quick, 15-minute assessment that gives you a 360° view of your assets, financial opportunities, and areas where your money could be working smarter for you. Start today and take control of your financial future!

 

Expat in Asia

About Three Sixty Financial

Three Sixty Financial is dedicated to helping British expats in Asia navigate their financial journeys with confidence. We provide impartial, fee-based, and holistic financial planning to ensure your wealth is managed effectively and ethically. As expats ourselves, we understand the unique challenges of living abroad and offer tailored financial solutions in Malaysia, Thailand, Hong Kong, and other regions across Asia and the world. Our mission is to help you take control of your finances, ensuring your money works smarter for you.

 

Meet Your Adviser

This article was written by one of our expert financial advisers at Three Sixty Financial, who have extensive experience helping British expats secure their financial future while living abroad. If you’d like to discuss your personal savings strategy, get in touch today!

 

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