Moving to Singapore Finance Checklist
Singapore is a popular destination for Australian expats due to its strong economy, high standard of living, and excellent quality of life. The city-state offers a diverse cultural experience, with a blend of Western and Asian influences, making it an attractive option for those looking to immerse themselves in a new culture. Additionally, Singapore is known for its excellent healthcare system, efficient public transportation, and low crime rate, which make it a safe and convenient place to live.
The country also has a thriving expat community, providing ample opportunities for socializing and making new friends. Furthermore, its proximity to other countries in Southeast Asia makes it an ideal hub for travel and exploration. All these factors contribute to making Singapore an attractive destination for Australian expats looking to experience a new way of life.
Moving to a new country can be an exciting but overwhelming experience, especially when it comes to personal finance. As a new Australian expat moving to Singapore, it\'s important to have a solid financial plan in place to make your transition as smooth as possible.
Here\'s a personal finance checklist that I’ve put together to help you get started and start making the most of your time abroad as soon as you can:
1. Research the Cost of Living: Before you pack your bags and say goodbye to the Land Down Under, it\'s crucial to research the cost of living in Singapore. This will give you a better idea of what you can expect in terms of expenses, such as housing, food, transportation, and entertainment. According to Numbeo, and most other data sources, the cost of living in Singapore is higher than in Australia, so it\'s essential to have enough savings in place to cover your costs during the transition period. And don\'t forget to factor in the little things, like the cost of a good cup of coffee!
Further to this, we have seen a steep appreciation in the rental prices in Singapore, which are unlikely to drop back to previous levels any time soon. You can find out a bit more about this in my video update here. Singapore also helpfully publishes the prices at which properties are actually leased, so in addition to the property listing websites such as PropertyGuru, you can find the accurate data for agreed lease prices between the landlord and tenants at this link here.
2. Open a Bank Account: Upon arrival in Singapore, one of the first things you should do is to open a local bank account. Not only will this make it easier for you to manage your finances, but it will also make it simpler for your employer to pay you. Take some time to research different banks and compare the features and benefits of their savings, current, and fixed deposit accounts to determine which one is the best fit for you.
You may need to ensure that you have a mobile phone number, or least physical residential address in Singapore before they will allow you to open a bank account, so be sure to check with the bank that you select what documentation they require you to bring along to open the account. The local banks, DBS/POSB, UOB, and OCBC, tend to be great options for most Australian expats, but be sure to do your homework and ensure that you select the right one for you.
3. Invest in Health Insurance: Singapore is renowned for its excellent healthcare system, but medical costs can still put a dent in your finances. To ensure you\'re covered in case of any medical emergencies, it\'s important to invest in a comprehensive health insurance policy that covers you and your family. You can review your employer provided plan, as well as considering a private insurance plan. Just make sure to do your research and find the plan that suits your needs and budget.
For many Australian expats, they may find that their employer-provided plan isn’t sufficient to cover them in the event of an emergency, so may elect to have a ‘back-up’ private health insurance policy, with a high excess, so that it keeps the annual premium at a reasonable level but they have peace of mind about ensuring that their family is covered.
4. Make a Budget: A budget is like a roadmap for your finances – it helps you stay on track and reach your financial goals. Start by listing all your monthly expenses, including housing, food, transportation, entertainment, and insurance. Then allocate a specific amount of money to each category and stick to your budget as much as possible. A budget is not a one-time thing – it\'s a living document that you can adjust as needed.
Singapore is a very easy city-state to spend money, whether it’s on travel, wining and dining, or shopping, so be sure to stay on top of your finances, and at the very least, keep an eye on your monthly expenditure in your first few months of being here.
5. Save for Emergencies: Emergencies can strike at any time, and it\'s always better to be prepared. Aim to save at least three to six months\' worth of your salary in an emergency fund, so you have a safety net in case of any unexpected expenses. Whether it\'s a medical emergency, job loss, or a broken washing machine, having an emergency fund will give you peace of mind and help you weather any financial storms.
This is money that should be accessible quickly, and is not invested in shares or elsewhere. Whilst it may be frustrating to have this cash sitting in the bank account not working for you, it is designed to be an emergency fund, so keep it boring.
6. Consider Tax Implications: Moving to a new country means you\'ll have new tax implications to consider. Singapore has a progressive tax system, so it\'s essential to seek advice from a tax professional to ensure you\'re following the rules and paying the right amount of taxes. Don\'t get caught off guard by tax surprises – stay on top of your finances and seek help when needed.
For many Australian expats, their employer won’t withhold tax from their monthly salary, so it’s up to you to ensure that you’re putting money aside for your tax bill. You can download the latest personal income tax calculator to find out how much you’ll need to pay here. I have also put together a short series of videos covering the key tax questions for Australian expats in Singapore, which you can find below:
- How Do I Pay My Tax In Singapore As An Australian Expat..? – Watch Here
- How Does The Tax System Work In Singapore For Australian Expats – Watch Here
- What Tax Deductions Can I Claim In Singapore..? – Watch Here
- When Is The Tax Year In Singapore – Watch Here
- Top 3 Tax Tips for Australian Expats in Singapore – Watch Here
7. Start Investing: Singapore\'s financial market is like a buffet of investment options - stocks, bonds, mutual funds, and more. As a new Australian expat, it\'s the perfect opportunity for you to start building your wealth by investing in a mix of these options. Whether you prefer to be hands-on with your investments or prefer a more passive approach, there\'s something for everyone. Remember, the earlier you start, the more time your investments have to grow through the magic of compound interest.
You may like to consider investing in both Australian and global investments to manage your Foreign Exchange exposure, you may be investing in property back at home, or you may be investing in a globally diversified portfolio of ETFs. Be sure to consider your options, be aware of the tax implications, and seek professional advice to ensure that you’re considering all of the options available to you.
8. Manage Currency Exchange: Moving money between Australia and Singapore can be a headache without the right approach. As an Australian expat, you\'ll need to manage currency exchange when sending and receiving money between the two countries. Consider using a foreign exchange service that offers competitive exchange rates and low transfer fees, so you can avoid paying extra fees and get the best deal possible. After all, why let your hard-earned cash get lost in the exchange rate maze?
There are many great FX brokers that you can choose from. At the time of writing, some of the reasonable options include OFX, Pay2Home and Wise (previously known as TransferWise), which all typically offer much better rates than using your bank to transfer funds. Be sure to consider both the fees and the spread that is charged for the transfer, as many make the mistake of assuming that their bank is a cheap option because there’s no fee, when in actual fact they’re 5 times more expensive than the FX broker when the spread is considered.
9. Plan for Retirement: Retirement may seem like a distant dream, but it\'ll be here before you know it. As a new Australian expat in Singapore, it\'s important to start planning for your golden years as soon as possible. Consider setting up a retirement account, such as a retirement savings vehicle in Singapore, or a Supplementary Retirement Scheme (SRS), or even utilising your existing Australian investments to grow your retirement savings and ensure a comfortable lifestyle in your later years. After all, you want to enjoy your retirement, not just survive it.
By following these points, you\'ll have a comprehensive and entertaining financial plan in place to help you navigate your personal finance as a new Australian expat in Singapore.
To Your Financial Success!
Jarrad Brown is an Australian-trained and qualified Fee-Based Financial Planner with Australian Expatriate Group of Global Financial Consultants Pte Ltd providing specialist financial advice and portfolio management services to Australian professionals in Singapore. Jarrad Brown is an Authorised Representative of Global Financial Consultants Pte Ltd - No: 200305462G | MAS License No: FA100035-3
Australian Expatriate Group is a division of Global Financial Consultants in Singapore providing specialist advice to Australians living abroad.
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General Information Only: The information on this site is of a general nature only. It does not take into account your individual financial situation, objectives or needs. You should consider your own financial position and requirements before making a decision.
*Please note that Jarrad Brown is not a tax agent or accountant and none of the content outlined here should be taken as personal advice. You should consult your tax agent and financial adviser to review your current personal finances and financial goals to consider whether this strategy is appropriate for you.
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