After living overseas for a long time it’s easy to get into the way of thinking that if the worst comes to the worst, you just have to make sure you have enough money left for the flight home. But life ain’t that simple, as some returning expats have found out to their cost.
The end of the expat road
Of course, in some instances the end of the expat road is signposted well in advance – perhaps even before the person sets off overseas. This is the case when going abroad to work on a fixed-term contract, for instance. While it may be possible to extend the contract in some instances, the likelihood of returning to your country of origin is more or less a done deal, which makes it a good deal easier to plan ahead and manage the repatriation process.
For those who’ve set off abroad under their own steam and without the safety net of a corporate organisation to help organise the practicalities, things can suddenly become far more complicated than they seemed before embarking on expat life. When people don’t think far enough ahead they can suddenly find themselves at the end of the expat road – and in the awful position of not having enough money coming in to support them.
There may be all sorts of reasons for this. Perhaps they’ve moved to their new home at a time when the exchange rates are working in their favour – their income and savings are in a currency that’s relatively strong compared with the local currency – but then a sustained adverse shift in the exchange rates means that their former relative prosperity has evaporated, and everything is perhaps 20% or 30% more expensive than they’d budgeted for. It could be that they’ve been working in a job that used to be in heavy demand when they first arrived, but changing economic circumstances in the country mean there’s no longer a demand for their services, either from potential employers or from customers if they’ve been self-employed. It may even be as simple as a change in the immigration laws, or in their family circumstances if married to a local, so that they no longer meet the criteria for residency or a long-term immigration permit, or for a work permit.
Pack up your troubles…
Without enough money coming in, many decide it’s time to head for home. This in itself may cause a considerable financial penalty over and above the cost of the air fare. Yes, it’s possible to have belongings shipped back to the UK, but that can be a very expensive business – though thankfully customs duty is not a problem, for the most part (personal effects generally aren’t subject to import duty as long as you’ve had them for over six months). Even a cubic metre or so of assorted belongings could set you back several hundred quid. But what’s the alternative, for someone who hasn’t got the money to stay on while they try (and quite possibly fail) to sell their kit for a halfway decent price?
But at least it’s possible (if expensive) to ship personal effects. With property, that’s not an option. So expats who have bought or leased a property may end up taking a big hit if the market’s depressed – a really big hit, if they’re in the awful position of negative equity.
Even supposing these issues can be resolved to the point that the returning expat can pack up (even if the only things left to pack are their troubles) and can still afford to buy their flight tickets, what will they do when they arrive on home soil? They’re unlikely to be able to walk into their old life as if nothing has ever moved on while they’ve been away. At the very least they’ll need to find somewhere to live and work – and that’s to say nothing of all the other ins and outs like health care, transport, utilities, local and central government taxes…
Becoming an expat is an enterprise. And just like undertaking any kind of enterprise in the commercial world, you need an exit strategy. How many people thought this through when they were setting off on their new life as an expat? Sure, in many cases they hope it’ll be forever, and it’s true that often some boats have to be burnt in order to just go for it wholeheartedly. But when Paradise turns sour, what happens next?
All this goes to suggest that time spent early on planning an exit strategy is time well spent. In the next few weeks we’ll be looking at some of the elements that you might want to consider for your own exit strategy.