Wise words for UAE expats on managing their money

Money expert, former expat and businesswoman Heather McGregor - aka the Financial Times columnist Mrs Moneypenny - has some wise words for UAE residents on how to best manage their finances while working in the Emirates.

Mrs Moneypenny knows a thing or two about money - and she knows a thing or two about expat life too.
If you're going to do one thing to improve your finances, spend just an hour a week on your budget, checking costs and rates, she says. Allowing for a two-week holiday, that's 50 hours a year. In a waking week it's less than 1 per cent of your time.
Heather McGregor is a 53-year-old former investment banker and headhunter with her own recruitment agency in London. She first started writing a column in the Financial Times16 years ago when she lived in Tokyo, under the pen name Mrs Moneypenny, and has since published six books about personal finance and careers for women, as well as presenting a TV show, Superscrimpers.
It's this expert knowledge, as well as her expatriate experiences that she shared with UAE residents when she attended Dubai's Emirates Airline Festival of Literature this year.
Ms McGregor, who has a private pilot's licence, an MBA and a PhD in structured finance, has lived in four countries as an expat over a decade - Hong Kong, Singapore, Japan and Australia. She married her Australian husband (Mr M) in Hong Kong in 1989, ensuring they had a prenup first. He is now a cricket coach at "Cost Centre" No 3's school - the tongue-in-cheek term she uses for her three sons.
With the transient nature of expat life, Ms McGregor says making provisions for retirement beyond a lump sum gratuity - as given in places such as the UAE and Singapore - is crucial, especially because, "on the whole, expats don't save a lot of money".
Knowing your "financial finish line" is her other major tip. "Most people want to pay off their property plus have an income for retirement. Know what that equates to," she says.
Personally Ms McGregor is working to pay off her "big" mortgage and US$2.7 million business loan (she bought out her employers, Airdre Taylor and Annita Bennett in 2004 and now runs the Taylor Bennett agency).
And for so-called trailing spouses, she advises asking your partner to make retirement provisions for you while you sacrifice your own career for theirs - a "brave" conversation, she acknowledges, but one she had with her own husband to ensure he had provisions (in the form of a buy-to-let property) when moving to the UK with her.
"Women need more financial knowledge - they live longer, statistically earn less and are more likely to take career breaks or go part-time," states the businesswoman. "The challenges are around ignorance and lack of information."
Indeed, when asked how to save at her Dubai lecture by an Emirati housewife who gave up her career when she married, the money expert had sound advice.
"She was given a monthly allowance by her husband for clothes and food bills but spent it all," she explains. "I told her: 'save 10 per cent of whatever you have, even housekeeping - say Dh1,000 a month - into a bank account in your own name. Spend half of it at the end of the year as an inducement. After three years you'll be saving more than you were saving at the beginning'."
Ms McGregor is a realist though - she considers "beautification" to be maintenance for women, not luxury.
For UAE expats, Ms McGregor also emphasises the importance of credit history. "Maintain a positive financial footprint - both where you live and where you want to return home," she says.
"If expats come from a country where credit is scored, like the UK, US or Australia, the worse thing is to 'disappear' altogether - bank account, mobile, credit card, utilities, electoral roll."
In the UAE, the Al Etihad Credit Bureau has been gathering data on every resident with a bank account, and you can buy your own report for Dh110.
But a sound expat financial strategy takes more than knowing your credit history, warns Ms McGregor. She says expats must prepare for when things don't go to plan - a will, life insurance and home contents insurance. It's a poignant remark when her own husband had a pacemaker fitted just before their trip to Dubai.
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