BBC Worklife has a lengthy article noting that not everyone who becomes an expat overseas will feel fabulously wealthy as there are often some pitfalls when it comes to cost of living surprises. The article cited an InterNations survey which found that expats in locations such as Italy, Israel and Greece were often unable to meet basic expenses due to the high cost of living. In contrast, expats who moved to Vietnam, Mexico and Colombia (places with relatively low costs of living) found their purchasing power increases substantially.
The article then cited a couple of cases where an expat ended up better off financially (Vancouver to Bali) and worst off (Canada to Sydney) while another expat profiled had “two years of a high-flying lifestyle” based in Singapore with a mining firm, but opted to move to Perth for less disposable income and a better professional fit.
In fact and according to HSBC’s 2017 Expat Explorer survey, only 15% of expats they were primarily motivated by financial incentives. The most popular reasons given were either to fulfil a sense of adventure, or for quality-of-life related to health or climate.
Finally, the article noted that even at large multinational corporations, more and more expats are hired on ’localised’ packages. This means instead of taking a temporary overseas expat assignment, employers are asking expat employees to make a permanent move for fewer perks and with no promises of a return ticket.
Dr. Yvonne McNulty, a senior lecturer in the School of Human Development and Social Services at Singapore University of Social Sciences, was also quoted as saying that the proportion of expats on generous compensation packages is now less than 50% and rapidly declining:
“For companies, localisation is simple,” she says. “It reduces their costs. For expats, it’s more complicated. While they receive fewer traditional financial benefits, they receive in exchange an intangible benefit of not being financially tied to their organisation, and with more freedom to change employers.”