Exceptional quality of life, modern housing, state of the art medical facilities, global education institutions, a highly developed infrastructure & an upgrade in the quality of life, are some of the amazing things UAE offers.
Expats often move to the UAE with a vision to better their lives & the future of their families.
But what happens when the day to day reality hits?
Sometimes, the high day to day expenses, an exceptionally fancy lifestyle & the constant comparison with your peers can often negate all the benefits of this great place.
I am sure most of us have faced the desire to own that Porsche & that massive beach facing villa in Dubai. If you have seen the popular Netflix show ‘Dubai Bling’ I am sure you know what I mean.
But, don’t worry. You are not alone. As a couple who has recently moved to Dubai, some of the common struggles can be summarised as below:-
1. Affording a decent accommodation
Behaviours like comparing yourself with your peers & the want to have ‘more’ can really mess things up for people. Although the rental prices in UAE have stabilised in recent years, accommodation is likely to be your biggest expense. Many companies do provide a substantial housing allowance for expat employees, but this isn’t as common as it was a few years ago.
2. Education in UAE
Although the UAE offers some of the best exposure to schools, universities & curriculums it comes at a hefty price! It can be quite challenging for parents to find schools that are affordable, international, and that are accepting new students. Moreover, tuition fees can be significantly high in the UAE. For some of my friends, I know they pay a bare minimum AED 36000 to 60000 per annum, kindergarten onwards.
So it’s extremely crucial to plan for education much in advance if you are an expat living in the UAE.
Another very important but most often ignored aspect is healthcare in Dubai. Again, most employers may offer to cover the basic health insurance but it’s always a good idea to check the details. Also things like Critical Illness Insurance may not be covered by your regular health insurance plan or the amount of insurance cover provided may not be sufficient.
4. Cost of Living
Dubai & Abu Dhabi rank among the most expensive cities in the Gulf region. Despite the favorable tax climate, living expenses can add up as expats splurge on luxuries they wouldn’t buy back home. Eating out, splurging on brands, travel expenses, groceries, etc can eat up a lot of your monthly income.
If you don’t budget your expenses & stick to it you may spiral into a debt trap quite easily as an expat in UAE.
5. Long Term Financial Goals
People often move to these cities with an aim to make as much money as possible & then move back to their home country or families. But that is possible only when you work with a well defined financial plan & follow it through.
Like discussed above, it can be very easy to sway away from your priorities once you get the taste of the bling life. Moreover, your goals need to be aligned as a couple. This often ends up being a major source of conflict for expat couples in UAE
One key fact most people forget is that if they were working anywhere else in the world they would be paying significant amounts of their income as taxes. They have the ability to save all of that money, but if you are not investing or saving it, then why be here at all?
If you decide to move to the UAE, be prepared to manage your expenses well. While the nightlife and glamor of the city is appealing, it can be a heavy burden on your wallet. Expenses come in from every direction – rent, utility expenses, bills & more.
And this is exactly where the guidance of a financial planner may come in handy.
As an Indian born expat living in the UAE for about 12 years now, I know how hard the struggle can be and how your expenses can spiral out of control if you are not careful.
So don’t be afraid to take that step & speak to a financial advisor today!