This is another post written just before we headed home to the UK.
The other day I took part in an HSBC/YouGov survey about Expat life, which was basically a whole set of questions about whether I thought moving abroad had been good for us, professionally and financially.
The cold hard truth is that, no, it hasn’t been that great for us financially.
All the expenses/costs of expat life came as a bit of a shock. We’ve gone down to one salary between the two of us, DC is far more expensive than we thought it would be, and we don’t do that well in terms of tax.
Rationally speaking, it’s really not a good idea to take a job in America unless you’re getting a really good package, or are working for a UK outfit over here. Market-rate salaries are usually calculated based on cost of living, including US tax levels. If you’re a British expat though, you have to pay tax at UK rates – making up the difference in the UK for what you’re not paying over here. You also don’t get the same deductions/allowances as US citizens (e.g. we couldn’t file jointly), so often your payroll won’t hold back enough tax and you end up with a tax bill while everyone else is enjoying ‘tax refund season’.
Health costs are also a fact of life over here. You always have to keep a certain amount of money in your account in case you need dental work for example.
And of course it was really difficult to get set up with a bank account and credit card. We were very lucky that one of us already had a social security number, and that the other of us had an HSBC account and a good credit record with them. We definitely needed the very modest relocation allowance we got, as we had to pay 1.5 months rent in advance and buy a mobile phone up-front, as we had no credit record in the US.
Now, I don’t like to complain – we are of course incredibly lucky to be able to have this adventure and to see so many amazing things – but this survey just brought home to me how, in many ways, we were materially better off in the UK. For some people I think time abroad can be financially positive, but I wanted to make it clear that this isn’t the story for everyone who moves abroad for work.
Luckily, life isn’t just about the financials, and our expat life can’t be boiled down to a balance sheet. Not only have we had some amazing experiences, but we’ve also learnt a lot and become much closer as a couple. There are probably a number of gains from these years that we’ll only realise in the future…
But right now I’d just like a bit more disposable income!