The 10 Biggest Mistakes Expats Make When Investing

Being an expat can be a challenge and an opportunity.

Based on 25 years of experience advising expatriates, here are my top ten investment mistakes I see every day and how to avoid them:

Investing Without Clear Goals: Too many expats invest without a clear goal or target. It’s essential to define what you’re investing for, whether it’s retirement, buying property, or funding education. This helps dictate the risk profile, investment horizon, and the necessary resources required.

Ignoring the Effects of Inflation: It’s not just about the returns; it’s about the real returns after accounting for inflation. If your investments are growing at a rate less than inflation, you’re effectively losing money.

Short-term Thinking: An focus on short-term growth can make you miss out on the benefits of long-term compounded growth.

Letting Money Sit Idle: Allowing substantial sums to sit in bank accounts often results in tiny returns. Actively managing your wealth can make a significant difference in your financial future.

Neglecting Budgeting and Forecasting: Financial success requires planning. This means budgeting expenses, forecasting future needs, and planning investments accordingly.

Prioritizing Lifestyle Over Savings: While it’s essential to enjoy life, prioritizing holidays, dining out, and lifestyle expenditures over savings and investment can have long-term financial consequences.

Misguided Focus on Cost: While cost-consciousness is good, the cheapest investment or option isn’t the best. It’s the value, the returns, control of risk, emotional behavior’s and alignment with your goals that matter most.

Not Making Finance a Household Priority: Finances and investments should be a primary topic of discussion in households. Being open about money matters can foster better financial habits and decision-making.

Taboos Around Money: Money issues shouldn’t be taboo or a source of embarrassment. Open discussions about finances, even challenges or mistakes, can lead to better understanding and improvement.

Avoiding Professional Financial Advice: Investing in unfamiliar terrain can be daunting. Expats benefit immensely from professional guidance to navigate investment structuring, tax implications, and potential pitfalls.

I hope these help you move forward as an expat and as always I am here to help!

About Mike Coady

Mike Coady is an expat expert based in Dubai and is on hand to help with all of the above and more.

Mike is an award-winning money coach and industry leader in the financial sector.

Qualified to UK Financial Conduct Authority (FCA) standards, a member of the Chartered Insurance Institute, a Fellow of the Institute of Sales Management (FISM), a Fellow of the Association of Professional Sales (F.APS), a Fellow of the Institute of Directors (FIoD) and featured as a highly qualified Financial Adviser in Which Financial Adviser.

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If you need more advice, then contact Mike Coady today to discuss our solutions and how we can help.

Blog published by Mike Coady.