If you are young and educated has there ever been a better time to jump ship and get clear of the country that is Britain today? Face facts, if you are a young person you are very unlikely to have the same opportunities your parents had, you are probably saddled with student debt and you pay half your salary to rent a room in shared flat with other poor twenty somethings. Perhaps you thought things would improve after a few years and your finances would eventually right themselves but any recovery we have had seems to have forgotten about you. Now imagine if there was a place you could double your salary, pay minimal tax, cut your rent or have it paid and eat excellent food every day for free, would you move? Lots of you would, and the word is starting to get round, from the ex-public school turnaround ‘mannying’ in Rublevka (an ultra-affluent area just outside Moscow), the young chef hoarding his start-up cash while cooking on a Sheikh’s yacht, to the law graduate grinding down her debts as a governess in Turkmenistan, the young, educated and broke are evacuating the country in droves.
Everybody starts with a goal in mind, to pay off debt, to get the funds to start a business, to buy the house but when the time comes to return many have second thoughts. The manny in Rublevka has his own apartment, use of a Mercedes and a quite ridiculously beautiful Russian girlfriend, the law graduate has learned Russian and is helping her charges’ father negotiate E.U. trade legislation while the chef has just been told his food is so good the Sheikh wants to take him to Los Angeles for the Winter months.
They have now accidentally dropped themselves into the serious money category, this was not the initial plan but it would be fairly imprudent to not keep such a good thing going for a bit longer, wouldn’t it? With their change of plan comes a change in goals, what are they now working towards?
I hope I can offer my advice.
Your financial goals have changed, the situation is probably now to save and invest for an uncertain future. Money gives you options, whether that is to return to your original plan in few more years or to build a life abroad, it is the one thing that you will definitely need. In this industry you could always be dismissed tomorrow; if the principal doesn’t like your food, girlfriend or sketchy legal advice, you could be on the next plane home. Surrounded by money and incredible spending it is tempting to start blowing your cash in a similar fashion, resist the temptation. Unlike your employer your cash comes from a salary, theirs will generally come from assets, the money they spend will be replaced tomorrow by a productive business or large investments, yours will not. Just because you are sharing their life always remember that it is not your life, you are a guest and one day you are very likely to return to the reality that most people know. Knowing this, what is a wise course of action?
After getting rid of any high interest debts the first thing that should be on your mind is a rainy day fund, nothing gives you confidence and bargaining guts knowing you have six months to a years living expenses on hand. If you have a change of heart or your boss puts you in an impossible situation you can simply make your polite excuses and get on a plane home. If you have savings you will not be forced to take the first job that comes along but can wait for that perfect opportunity with a great family.
The second most important thing to get going is some investments. Sitting in a staff house a few years ago I was stuck by the amount of business activity going on around me. An Indian Manny seemed to be having problems with his builders in Kerala, a Filipino butler was calmly negotiating the hiring of staff for a café he owned while it was whispered that a senior Tunisian P.A. owned half the beach front apartments in Sousse. While that level of industriousness may possibly be beyond the average British graduate you should be getting some financial advice. Nobody has ever got rich keeping their money in the bank and with inflation you are almost guaranteed to be losing real purchasing power every year. Many banks and financial services companies offer products for expats and I would encourage you to do your research. HSBC offshore and TD International (Luxembourg) spring to mind for investments and I would hope that you would discover something suitable for your situation. A good tip is to have some copies of your passports certified by a British Notary Public before leaving home as this will make opening an offshore account far easier especially if you are moving to Russia or the C.I.S. where notarising anything can be very time consuming and require translation. If you are going to start dipping your toe into investments I should think that you would be advised to look at safe funds and products with extremely low fees to begin with and perhaps build on that so that in future you may be able to generate a small income with growth of capital. If you want to take a more independent role in your financial decisions you could do worse than reading Benjamin Graham’s classic “The intelligent investor” some of Warren Buffett’s letters and perhaps, if you are a little more intrepid, “One Up On Wall Street” the classic investment book by the incredibly successful fund manager Peter Lynch.
If after a few years of hard graft you have managed to build a sizable fortune you will have many more opportunities than before. With a greater sense of security you may even be able to afford the life that an older generation took for granted all those years ago!