The highest paid expats in the world are living in Asia but worldwide most expats have found that the global economic downturn has affected their finances especially in the UK which is one of the most expensive countries in the world for foreigners, according to the largest ever survey of expats.
While Asia has the highest earners, the poorer earners are in Australia and Western Europe, the survey Expat Explorer, commissioned by HSBC Bank International, has found. The highest proportion of expats earning more than US$250,000 are in Russia, 30%, followed by Hong Kong, 27%, Japan with 26. The lowest paid expats live in Australia and Belgium, with the majority of expats earning under US$100,000.
Those living in Asia also find their money goes further with expats in Malaysia, China and India finding accommodation much cheaper than they did living in their countries of origin, the report shows.
Overall people save more when they become expats. Over two thirds, some 68% of expats reported that they are saving and investing more since they moved away from their home country and this figure rises to 80% among the highest paid. Only 14% of expats said that they are saving less.
Expats in Saudi Arabia, Russia and Qatar managed to save more now since moving than expats in any other country, with some 90%, 97% and 98% respectively, putting more away.
Aside from the usual bank accounts, popular methods for saving and investing money among expats include, shares, property and managed funds. Property was a popular option in Bahrain and South Africa, 68 % and 73% of expats in these countries chose to put their money in bricks and mortar, while 68% of expats in Japan chose managed funds.
The collapse of global markets has left investors in Asia undeterred, however, with shares still proving popular for expats in Hong Kong, Japan and Malaysia. Expats originating from Germany and Brazil are the most reluctant to invest in property, just 21% and 22% put their money here,compared with 46% global average.
The credit crunch though has changed expat life with 63% saying it has changed their attitude to spending. The most affected expats are based in Russia, US and Japan where 73%, 74% and 76% respectively, admitting it has had an effect. Almost three-quarters, 72%, of expats based in Thailand also reported that the global recession has had an impact on what they spend despite reporting that Thailand is one of the cheapest places to live compared with other locations around the world.
Conversely, two thirds, 63%, of expats living in Qatar said the credit crunch would not change their attitudes at all. Expats living in Bahrain were also unwilling to let the economic doom and gloom affect their lives with 55% saying that their attitude to spending would not change.
The biggest reaction has been cutting back on luxuries with 60% of expats worldwide saying that has been their first option while 54% have cut back on day-to-day expenses and 36% stated they were saving more for a rainy day. Those least likely to cut down on luxuries were in the US and the UK, but this group also ranked highly for expats considering returning home due to the global economic crisis.
The main reasons for choosing to return home included limited career prospects, 28%, reduced value for money, 19%, cannot afford as good a lifestyle, 16%, and reduced length of contract, 15%. However, despite the credit crunch, a resounding 85% of expats said they would not return to their native countries. The UK emerged as an expensive destination for expats with 79% saying they spend more on accommodation, 68% spending more on transport and 61% finding utilities more costly. Worldwide, 74% of respondents claim to have increased disposable income since becoming expats, yet this figure falls to just 47% of expats living in the UK.