Posted on: 28th April 2025

How to Create a Financial Plan as an Expat in the Gulf

Moving to the Gulf is an exciting adventure. With tax-free salaries, booming cities, and plenty of opportunities, it's no wonder so many expats choose countries like Saudi Arabia, the UAE, and Qatar as their new home.

But living abroad also brings financial challenges. That's why having a solid financial plan is so important.

In this article, we'll guide you through the key steps to create a financial plan as an expat in the Gulf, helping you make the most of your time abroad and secure your future.

Understand the Local Financial Environment

One of the biggest draws of the Gulf is the tax-free income. With no income tax to pay, you can save and invest a lot more than you might back home. But the financial system works a little differently here.

Many banks in the Gulf operate under Islamic banking rules, which means traditional interest-bearing accounts are not common. Instead, banks offer profit-sharing accounts that follow Sharia principles. It's worth understanding how these work before opening an account.

Also, remember that while the Saudi Riyal and UAE Dirham are pegged to the US Dollar, currency transfers to and from your home country may still involve fees and exchange rate differences. Always check the costs when moving money internationally.

Set Clear Financial Goals

When you're living overseas, it's even more important to know what you're working towards. Setting clear goals can help you stay focused and motivated.

Think about your short-term goals – saving for travel or buying a car. Then consider your medium-term goals, like funding your children's education or purchasing a home. Finally, don't forget long-term goals, such as building a comfortable retirement fund.

Your goals might change as your life evolves, so review them every year and adjust your plan if needed.

Build an Emergency Fund

Life can be unpredictable, especially when you're far from home. An emergency fund is your safety net.

If you lose your job or face unexpected expenses, it can help you stay afloat without dipping into your investments or going into debt.

Aim to save at least three to six months' worth of living expenses. Keep your emergency fund in an easy-to-access account, and top it up regularly. It's not exciting, but it's one of the smartest moves you can make.

Diversify Your Income Streams

While your main salary might be generous, relying on one source of income can be risky. Building additional income streams gives you more security and flexibility.

You could invest in stocks, bonds, or funds. Real estate is another popular option, whether locally or back home. Some expats also set up side businesses or do freelance work online.

Having more than one way to earn can give you peace of mind – and extra savings for the future.

Plan for Retirement

Without employer pension schemes common in the Gulf, it's up to you to plan for retirement. It might feel like a long way off, but the earlier you start, the easier it will be.

You can contribute to private or offshore pension plans designed for expats. Or you could invest yourself through funds and long-term savings plans. Either way, make sure your retirement savings fit your risk appetite and your long-term goals.

Remember to review your retirement plan regularly and adjust as your situation changes.

Understand Your Tax Obligations

Even if you don't pay taxes in the Gulf , you might still have tax responsibilities in your home country. Some countries, like the United States, tax citizens on worldwide income no matter where they live.

Check if double taxation agreements exist between your home country and your Gulf country. These agreements can prevent you from being taxed twice on the same income.

Tax rules can be complicated, so getting advice from a professional who specialises in expat taxes is wise.

Choose the Right Banking and Investment Platforms

Choosing the right bank and investment platform can make managing your money much easier.

Look for properly regulated banks that offer products suited to your needs. Many Gulf banks offer Sharia-compliant accounts and investments if you want to follow Islamic banking principles.

Make sure your investment platforms allow you to manage your money across borders. Flexibility is key when you're living abroad.

Seek Professional Financial Advice

Managing finances as an expat can be tricky. A good financial adviser can help you build a plan tailored to your goals, whether you're saving for a home, planning for retirement, or investing for the future.

Look for advisers who understand both the Gulf market and international financial planning. The right advice can save you time, money, and a lot of stress.

Conclusion

Creating a financial plan as an expat in the Gulf might seem daunting at first, but it's one of the best things you can do for your future.

By understanding the local financial environment, setting clear goals, building an emergency fund, and seeking professional advice, you can enjoy your time abroad and build a secure future.

Start planning today. Contact Holborn to find out how we can help you.