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Every year, thousands of people from all around the world pack up and leave their home countries in search of a new life abroad. In 2009 – 2010 alone,The Guardian estimates that hundreds of thousands of British Citizens emigrated, with roughly 64,000 Brits leaving for Australia, 26,000 leaving for the U.S, and 14,000 leaving for Canada. So, it’s fair to say that living abroad is more popular than ever, at least among Brits. However, if you’ve been thinking of living abroad, you’ll lively have realised that there’s a lot of things to consider before making your move. You need to figure out where you’re going to move to, whether it will be temporary or permanent, how much travel money you should take and also, what life as an expatriate will be like. Luckily, we’ve created this guide to help answer these common questions.
What's an expat ?
An expatriate (or “expat”) is the name given to anyone who is temporarily or permanently residing in a country other than his or her country of origin (i.e. the country in which they were “brought-up” in). The word is derived from two Latin terms: ex meaning “out of”, and patria meaning “country” or “fatherland”. When most people refer to someone as an expatriate, they will be referring to professionals, skilled workers or those who are sent to another country to work by the company for whom they are employed. It is rarely used as a descriptive term for immigrants or migrant workers, even though the actual definition of the word does fit that use. The term is also widely used to describe those who permanently relocate to another country following their retirement. In fact, this is arguably the most common scenario in which the word is used to describe an expatriate.
Becoming an expat
According to the BBC, it is estimated that 5.5 million British people live abroad on a permanent basis. This makes approximately one in ten of the UK population expats. If you’re thinking of moving abroad and becoming an expat, there are a lot of things that you need to think about before making your decision. It’s important that you think about whether you plan to move abroad permanently or temporarily, as this will usually affect the commitments and ties you choose to keep in your country of origin.
For example, assuming that you’re planning to live abroad permanently, you’ll likely wish to sell the home you own in your country of origin, move all of your belongings, close your existing bank account in your home country, open a new bank account in the country you’re planning to relocate to and essentially, cut all or most ties to your home country (aside from friends and family, of course). Alternatively, if you’re only thinking of living abroad on a temporary basis, you may wish to keep your existing bank accounts for future use, rent (rather than sell) your existing home and also, you may wish to simply take a set amount of travel money rather than shifting all aspects of your finances to your chosen expat location. Whether you’re thinking of becoming a permanent or temporarily expatriate, it’s also important that you carefully consider your expatriate location, as there are a lot of options (all with different benefits and disadvantages) to choose from.
The best and most popular expat location
According to the BBC, Australia is by far the most popular location for British expatriates with an estimated 1.3 million Brits choosing to relocate down under. Not far behind Australia we have Spain (with an estimated 761,000 British expats), the United States of America (678,000 British expats) and then Canada (603,000 British expats).
It’s easy to see why so many Brits are relocating to these locations as according to NatWests IPB Quality of Life Report, Australia has been voted the country with the best quality of life by British expats. This was closely followed by Canada in second place, the UAE (United Arab Emirates) in third place, and a little further down the list – yet still within the top 10 – the USA in ninth place. For 84% of Brits, the Australian sunshine is one of the top five reasons for moving there and 82% said that they enjoy a better environment and quality of life for their children, according toThisIsMoney.co.uk. However, there are many other popular locations for anyone thinking about living abroad.
consider such as capital gains tax when selling your property (if you’re relocating from the UK), opening new bank accounts and even the strength of the currency in your chosen expatriate location against that of your country of origin. This exchange rate is also an important thing to consider when thinking of living abroad on a temporary basis, as it can dramatically affect the value of your travel money. For example, if you’re considering moving from the UK and living abroad in Canada, you’ll be in a favourite situation in terms of finances as the strength of the pound against the Canadian dollar is currently quite high.
As of December 13th 2014, according to XE.com you would receive approximately CAD $1.82 for every Pound (GBP). Compared to this time last year, you’d receive approximately $0.23 more for every Pound you exchange (i.e. an increase of almost 15%). It doesn’t matter whether you’re looking to purchase a house or simply exchange some travel money for a temporary expat stay, you’ll end up with more “bang for your buck” when exchange rates are favourable between your country of origin and your chosen expat location. If you exchanged £5,000 in travel money today (December 13th 2014) for Canadian dollars, you’d receive $9,100 (minus any commission and fees). Just a year ago, you would have only received $7,950 worth of travel money. Similarly, if you sold your house in the UK for £200,000 and exchanged it for CAD, you’d have (as of December 13th 2014) $364,000 to play with when house hunting in Canada. Just a year ago, you’d only have received $318,000 to spend on a house. Whether you’re just looking to exchange a bit of travel money or a mammoth lump sum, it definitely pays to choose a location with a strong currency. You can check the current exchange rate and strength of currencies using an online comparison tool.
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