The Importance of Cost of Living

Cost of Living Dec 07, 2023 No Comments

Before accepting a job abroad, consider what your expenses will be.

A dream job abroad can open many doors and boost your resumé. It can lead to mind-opening experiences and adventures that you’ll remember for a lifetime. Immersing yourself in another culture can be amazing in a multitude of ways, but before you make any move, it’s important to consider the cost.

Income versus Expenses

Some countries are very expensive, and it’s important to make sure your salary will be enough to enable you to live a comfortable lifestyle in the country you are considering. In some countries, foreign salaries are not as high as they used to be. Last year, expats’ pay packages dropped by 5% in China, for instance. However, despite the drop, China still ranks fourth, after the UK, Japan and India, for highest packages for foreign professionals, according to a recent report by ECA International. Hong Kong rounds out the top five.

When considering the cost of an expatriate package, ECA International says companies should be considering three main factors: the cash salary, benefits – such as accommodation, international schools, utilities or cars – and tax. Make sure these areas are included in your package and that they correspond well with the cost reality of the country you are considering.

Biggest Expense

Almost anywhere you go, your biggest expense will be housing. Take the time to weigh your options to find housing that suits your lifestyle and is affordable. No one wants to be house poor when abroad if you can help it, as this limits your ability to travel and take advantage of the opportunities before you. So, beware of the allure of the city center historic apartment overlooking the square (unless you can easily afford it); it may be beautiful, but it will also be pricy. It is okay to live outside of the city center but still close enough to get there easily and enjoy all its offerings. You’ll save plenty. Here are some things to consider:

  • Employ a local real estate agent to help in your search if this is what is recommended. It may save you time and trouble.
  • Renting versus buying: What’s best will depend on where you’re going. Take the advice of professionals you can trust on this.
  • The closer housing is to the center of the city, the higher the rent.
  • Locations close to subways are typically more expensive, as well, even away from the city center.
  • Housing in expat communities, even on the city outskirts, is also costly, but it can be beneficial in other ways, as you may have a positive social life there.
  • Proximity to work is important. Don’t forget the practicalities of the daily commute.
  • Remember this is not a vacation you’re embarking on, but a long-term living situation. Can you see yourself enjoying the place a year down the road?

How to Save: Some General Tips

The best way to stretch your money in any foreign country is to live like a local. This means:

  • Shop in the local grocery stores and buy local food.
  • Cook meals at home sometimes versus dining out.
  • When you dine out, choose local favorites, rather than chain or international restaurants.
  • Live outside of the city center, where housing will be less expensive.
  • Travel using public transportation.
  • Walk or bike to work if you can.
  • Save where you can, and splurge sometimes on the things that matter to you. This is a once-in-a-lifetime experience. Enjoy it!

By Mary Anne Thompson, founder and president, Goinglobal, Inc.

Look for more information on cost of living in GoinGlobal’s Country & City Guides.

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Mary Anne Thompson

Mary Anne Thompson founded GoinGlobal, Inc. more than two decades ago as a result of her own experiences job hunting in Sweden. She believes that to uncover the real job opportunities, you need the experience and personal insights of trained local specialists. Mary Anne continues to be an active CEO who shares her strategies and insights directly with clients to help them strategically maximize GoinGlobal’s unique resources.