Although the best things in life abroad – sun, space and a fresh start – may be free, establishing yourself in the country won’t be. Many would-be emigrators get a nasty surprise when they realise how much it costs to make a new start in a country like Australia or Canada. We’re normally talking five figures. So where does it all go and how can you make savings?
The wave of Brits who went to Australia and New Zealand after 1945 only had to pay £10 to get there. It’s easy to envy the “Ten Pound Poms” when you consider that an average couple will need £10,000 to get there and set up home today. So where will you be spending all that money and where can a currency company help you?
Before you go
The first fees will be for visas and applications. For example, an immigration agent for Australia could be charging up to $5,000, if you choose to employ one. The skills assessment will be anywhere from $300 – 1,500 and there will sundry extras such as for a certified copies of documents. There may also be medical fees to pay before you move.
When you come to actually pay for the visa, the fees really start to stack up. For Australia in 2019 the main applicant will be paying $3,755 plus nearly$ 2,000 for a secondary applicant and close to $1,000 per child. However, this is only paid towards the end of the process so you’ll have a while to save.
For New Zealand, the skilled migrant visa is over NZ$3,500. Some countries also require you to prove that you have enough to live on (It’s over NZ$4,000 in New Zealand for a working visa) or a return ticket.
Air fares to Australia are around £500 one way, but it won’t just be you that has to get there. For shipping, an entire home’s contents will cost up to £6,000. For smaller amounts, a standard shipping “box” is the size of an under-counter fridge. To send 10 of those by sea costs about £350, and should arrive in Australia in two months.
You might be tempted to sell your stuff in the UK to save shipping costs, in the expectation of buying new overseas. This can make sense, in countries such as Canada where the costs of living are lower than here. However Australian and New Zealand prices are not cheap, so it may be more cost effective to ship.
Your first two months
The biggest cost will be rent. In New Zealand the houses are large, but so are the prices. The average rent is around NZ$300 per week for a small flat and NZ$550 for a house. There will be a month to pay up front and normally a deposit too. Those are unfurnished prices and the costs here soon add up when you start stocking the kitchen, larder and airing cupboard.
There are other costs, such as for childcare. Some of these might take you surprise. Such as the “voluntary contribution” to your kids’ school, amounting to as much as NZ$800 (€467) a year. That’s for a state school, you’ll pay much more if they’re private or an integrated school.
Help with your currency
Moving abroad may seem like a huge project, but you don’t have to do it on your own. There are a host of experts to explain and steer you away from the risks, to get you there as easily and expensively as possible. When it comes to currency exchange, there are a few potential risks. The first is that emigrants, for quite understandable reasons, use the financial institutions they are used to dealing with – their high street bank or credit card company. Not only could this be an expensive way of doing business, but risky too.
From a cost point of view, if you’re using finance from the UK, with so much else to think about you might be tempted to simply pay for things on your UK bank or credit card, at whatever rate they deign to give you. It is far more sensible to transfer a larger sum in one go. Speak to your trader about that. Alternatively, set up a Regular Payments Plan to pay ongoing amounts, such as rent, until you get settled.
When you have resolved to stay, you may have a larger transfer. It could be from the sale of a UK property, or a pension. In due course you may have an inheritance. For all those payments, timing can be crucial. Again, speak to your trader about whether a Forward or a Spot Contract will be better. the difference could be in the thousands.