Introduction
Getting your finances in order before leaving a country is one of the most time consuming activities. The last thing you want when arriving in a new country is having to sort out something you missed with an insurance company or bank back home.
We also strongly suggest that you should get online with any of the below companies in case you need to resolve things once you are out of the country. This includes the banks, insurance houses and stock brokers.
Your Budget
Your financial budget is the most important bit of planning that you will do and you need to stick with it from the start through to the time you settle down in your new country. This is due to the amount of financial transactions that you will make in the month prior and the two months after making a move.
To make your budgeting easier we suggest that you break it down into 3 sections:
Normal monthly budget
This budget will show what you normally spend in a month (good for comparing in your new country). Try and start this three months prior to moving if possible.
Moving expenses budget
These are all the expenses required to move. This may include the cost of the container, the tickets, visas and other costs.
Relocation expenses budget
These are the expenses that you are going to incur whilst in your new country and before you start to earn a salary. It is important to know what you have to spend in order to settle down.
It is a good idea that when paying for things, try not to put too much on your credit card unless you will get something in return (like buying your airline tickets on a credit card gives you free insurance) - try to use cash for the small items and remember to get a receipt. The reason for this is when you use cash you tend to watch your money carefully and you don't want to get a credit card bill once you are in another country.
Banks
Dealing with the banks can go two ways. The first is very easy and the second can be extremely frustrating. Before you approach the banks, it is wise to get as much information together as possible about your accounts and products that you have with the bank.
If you are closing your accounts down, there may be a charge levied against that account, so make sure you understand the costs involved.
Here is a simple check list to use for the banks:
- List of banks used, accounts, account types, balances
- List of direct debits on each account
- 3 months worth of statements (for opening new accounts)
- Bank letter (saying that you have an account with them)
- Power of attorney for someone to sign on your behalf
- Bank Managers name
It is a good idea to sign up to your banks Internet service. This allows you to check balances, make transfers and set up standing orders on your account from anywhere in the world.
Banks usually ask for a general Power of Attorney to be signed so they can manage your accounts whilst you are away. Be careful with this document as who has a Power of Attorney can sign away your life!
Store Cards
There are two types of store cards to be aware of: account cards and reward cards. Our advice for both is to close them as they are of no use to you in your next country.
For your account cards you will need to pay off any outstanding amounts and remember to get a final statement from them. Be aware that they know that the account is closed else they will reissue new cards when your old ones expire and will usually levy a yearly fee on the card even if it is not in use.
With the reward cards you must ensure that they know that the card is closed so they do not send you monthly statements and marketing material to your old address.
Insurance
Contact your broker and see what you have in your portfolio. It is a good idea to make a list of each policy you own, the policy number, termination date and any other information. You may want to keep some endowments open in which case you will need to make sure that you have funds in your bank account for these or that you pay a yearly amount.
A list of policies may include:
- Household insurance
- Car insurance
- Endowments
- RA's and pensions
- Medical Aid
With regards to your pension - make sure that the pension from your employer is taken into consideration in your planning. Some funds may take months to pay out. You will then need to work out where you put the money and when you will pay any outstanding tax on the amount owed if you pull it out of a pension scheme. We recommend speaking to an insurance broker about your options to re-investing it or sending it offshore.
Investments and Shares
The quickest way to sort out your investments is to either contact your broker or find a broker who will assist you. Things to watch out for are dividends payable (have they got a contact address or do they pay them straight into an account?).
Get online! There are a number of great online brokers who will manage your portfolio for you. You can transact safely through the internet to buy or sell shares from anywhere in the world.
Foreign Exchange
You must get a tax clearance certificate before you leave. Contact your nearest SARS office for the latest information on what to do.
This is always the fun part! Seeing your wealth divided by a double digit amount depending on the country you are going to is not a pretty site. If you already have used the offshore allowance (currently R750,000 per adult) then you will only be able to take the travel allowance out with you. If you plan to fully immigrate then you will be able to take a lot more with you. Contact SARS for more information.
If you are taking travelers cheques with you you will need your plane ticket to be issued before the banks will release the cheques to you.
Tax
You must get a tax clearance certificate before you leave. Contact your nearest SARS office for the latest information on what to do.
Remember to get your previous company to give you your IRP5 or to forward it to your new address so that you have records of what taxes you have paid.
