Envision this scenario – you’ve accepted a job offer in an exciting city abroad, with a decent salary to boot. You’re looking forward to exploring a new city – but rent, socialising and other living costs have taken precedent over saving for retirement. Indeed, moving between countries can pose challenges for wealth planning.   

Neglecting to save for retirement can lead to a decrease in quality of life, should one transition from being a high-earning expat to an individual bound for retirement holding little savings.  

In Asian cities popular for expatriates, such as Hong Kong and Singapore, living expenses rank as some of the most expensive in the world. The importance of saving for retirement becomes even more important.  

Why should I set money aside for retirement?  

How an individual manages their money today correlates strongly with their future financial portfolio. Thus, setting money aside for retirement is significant – it affects one’s future quality of life and ability to pursue certain goals, whether related to retirement desires, family planning or other needs.  

Expatriates in the Gulf States for instance, have done poorly in saving for retirement. 22% save nothing every month, while 27% save less than 5% of their monthly salary. 13% set aside 6-20% per month.  

A leading retirement specialist noted that it’s usually only after a significant change in circumstances – such as losing a job – that expats realise how years of poor financial planning can affect the rest of their lives, as told to Arabian Business.

“The earlier people start saving the better. For your long-term goals such as retirement, you should try to put away 20-30% of your monthly salary,” she added.  

Moving abroad to a new country also means that expats may not have access to certain social protections as they might have had in their home country. Some countries for instance, may not offer free public access to healthcare. Staying in one’s home country also offers more simple retirement planning – one set of taxes and sometimes, pension schemes. It’s important to stay up-to-date on tax requirements of both countries, which could have a large impact on one’s retirement portfolio.   

How to plan for retirement   

It is necessary to ensure a multi-tiered plan for retirement – one that includes both saving and investing to help with short-term and long-term goals.  

While it can be difficult to figure out the exact sum one needs for their envisioned retirement, financial planners say it’s important to calculate how much one plans to spend annually in retirement, age of retirement and how much can be saved prior to retirement.   

Even with savings and investments, it’s important to factor in scenarios such as rising inflation, volatile investments, currency fluctuations or an unexpected life event – such as an illness.  

A few, time-tested tips to start with are to ensure that a portion of your income is set aside in savings – namely, a safe place to store cash that accumulates interest. Given the demands of daily life, it’s also beneficial to automate your savings every month – which ensures a fixed portion of your income will be directed to your retirement portfolio, whether in your savings or investments.  

Your retirement portfolio should also include an investments portion, which is the best way to guarantee your long-term portfolio. Investing involves various methods, including buying individual company stocks, ETFs, mutual funds and much more.  

Creating a long-term retirement portfolio, which involves setting money aside for savings and growing it with investments, will ensure your safety net in retirement – whether it’s to live a comfortable lifestyle post-career or plan for your family’s needs and more.  

Start your retirement planning journey with Winson Capital. Our consultants can help you tailor a plan specific to your goals, needs and circumstances – taking into consideration your income, jurisdictional tax implications, family matters, estate planning and more.