- 78% of expats see the UAE as the ideal expatriate location
- 90% of expats are aware of tax implications when returning home
- 94% of expats put their money aside for investments and/or savings
- 97% of expats spend some of their disposable income on luxurious lifestyle choices
Financial stability is the driving force for westerners to leave their home country and become an expatriate, according to the first Standard Life Western Expatriate Wealth Study. Standard Life’s report studied the saving, spending and investment behaviour of approximately 200 western expats across the UAE of which, 78% choose the UAE as the most ideal place to live, providing the best opportunities. To put this into context with the first batch of the Western Expat survey results from Standard Life, the UAE respondents compared to Hong Kong and Singapore were found to save less. However when observed in isolation, UAE western expats seem to have a stable financial future.
Chris Divito, CEO, Standard Life International Limited (DIFC Branch) said: “Many western expats in the UAE come to live here because of the countless opportunities that this country has to offer, of which one of the biggest benefits is the tax free salary. A tax free income provides a great opportunity which may lead to relatively higher savings and in turn allow expats to save more on a regular basis. We believe our research offers consumers a glimpse into their various savings and spending habits and creates an opportunity to revisit any financial issues they may have.”
With 97% of UAE western expats spending some of their disposable income on luxurious lifestyle choices, there seems to be an overlap, as 94% also spend the bulk of their disposable income on savings and investments. In addition, the study shows that 56% is spent on real estate which includes rent or mortgage payments and 51% on their loans. This is followed by children’s education, health related expenses and monthly miscellaneous household expenses.
Mr Divito concluded: “With an increasing number of UAE western expats paying off their financial liabilities, it is leading to greater strain on their long-term savings and investments. Financial stability is a key priority for expats, and it drives them to plan for their future but at the same time our research has found that spending on non-essential luxury items is also a priority for consumers.”
The report revealed that 61% of UAE based western expats have not yet decided on their future plans and whether they would return home. The reasons for returning after being away for so many years largely depends on new job opportunities or having enough savings to return home and retire. With 90% of expats being fully aware of the tax implications when returning home, 76% are confident about their retirement funds irrespective of their location.
In the UAE, only 65% of western expats seek guidance from financial advisors and banks about their finances. Whether you have one or more dependants, it is always advisable to take professional advice when it comes to financial planning.