Moving abroad: Financial realities of solo and expat couples

  • couple planning their budget
Published on 2023-12-05 at 10:00 by Asaël Häzaq
The inflationary economy is forcing us to reconsider our choices when it comes to living abroad. Although you might think that relocating alone will always cost less, this might not always be the case. Couples are advised to consider their plans by using comparison tools instead of just saying goodbye to their partners to move alone.

The cost of living abroad might be predictable

The cost of living abroad varies greatly depending on the destination, and very often on the future city of residence. According to the 2023 Mercer rankings (based on 2022 data), Hong Kong is the most expensive city for expatriates, followed by Singapore and Zurich. Copenhagen is ranked 9th, ahead of London (17th) and Tokyo (19th). The Economist group's EIU (The Economist Intelligence Unit) ranks New York as the most expensive city in the world, ahead of Singapore and Tel Aviv. Hong Kong is 4th, Copenhagen 10th. The Eurocost International ranking places Hong Kong as the most expensive city in the world, ahead of New York and San Francisco. Singapore is 4th, Zurich 9th.

Logically, the city you choose to relocate will affect your budget. The cost of immigrating to a major capital or a small provincial town will not be the same. In addition to the price of tickets and visa formalities, every single detail must be considered: accommodation, one of the most significant expenses, bills and taxes (electricity, heating, water, Internet, tax, etc.), transport, health insurance, car insurance, food, clothing, among others

Is moving alone more profitable?

According to the Banque Populaire Française comparison tool, living solo in New York costs 25% more than living in Paris. Accommodation alone makes a huge difference, with an average of almost $1,400 a month for a one-bedroom flat in the center of Paris, compared to around $3,090 for the same flat in central New York. That's an increase of 122.80%. While the same accommodation is cheaper outside the city center (almost $1,000 in Paris, 1985 in New York), it is still 99.80% more expensive in New York.

In Hong Kong, the most expensive city in the world, accommodation is also a major expense for the solo expat. The cost of living there is 29% higher than in Copenhagen. A city-center flat is 37.90% more expensive in Hong Kong (almost $2,200 a month in Hong Kong, compared to $1,590 in Copenhagen). Living outside the city center remains 22.60% more expensive in Hong Kong. The cost of living in Hong Kong is 39% more expensive than in Los Angeles, 60% higher than in Toronto, and even 87% higher than in Dubai (with food costs 83.40% higher than in Dubai). But living alone in Hong Kong is only 9% more expensive than in Zurich, another of the world's most expensive cities.

Sharing the costs as a couple

Moving abroad solo means you'll have to make more calculations as you'll be relying on yourself. That doesn't imply you will depend on your partner by moving as a couple. However, knowing the other person can assist in an emergency can be reassuring. It is even better if both spouses work, as costs can be split accordingly. Paying rent will get easier with two salaries, even if it initially costs more (larger surface area, more spacious bedroom, etc.).

Moving abroad as a couple (still with two salaries in mind) can be more reassuring for landlords. In New York, it is estimated that a single person renting a studio apartment spends nearly $ 20,000 more annually than a couple. Although priceless, freedom has a cost. Nationally, single people spend around $ 7,000 more than couples. Hence, many tenants are eager to find a date as quickly as possible, not only out of love but also to share the expenses.

What about couples living of a single income?

The unemployed partner can help the other one in another way: they calculate the budget, do the shopping, negotiate contracts (electricity, Internet, heating, etc.), track down unnecessary expenditures, take care of the house, etc. Their activity, although unpaid, counts as labor and saves money. The employed expat, therefore, has more time to take care of other things, which also leaves room for better performance at work. Consequently, the spouse has a real positive influence.  

Tax issues

Tax can have a significant impact on expats' budgets. For instance, single expats living in France pay a higher proportion of tax than couples, and even higher tax than couples with children. According to the French Ministry of the Economy website, an individual with a net taxable income of €35,000 in 2022 will pay €3,194 as tax. In contrast, a couple with two minor children and a net taxable income of €55,950 in 2022 will pay only €2,598 as tax.

This is explained by the calculation system, which is based on the number of tax shares (family quotient). An individual has two shares. Having children increases one's shares. However, the calculation of income tax also depends on the level of income. Individuals without children consider legal solutions to pay less tax. Couples may have an advantage in this respect.

The unquantifiable cost of moving abroad

We have already mentioned the invaluable support of an unemployed spouse, often tagged as the trailing spouse. However, there is an additional cost that is difficult to measure but may have real consequences – the emotional toll. Moving abroad means leaving behind your roots, family and friends. This separation can affect you mentally, even after several months or years of living abroad.

Learning about a new culture, joining a new company, discovering a new neighborhood, and new activities form part of expatriation. It means talking, eating and living differently. These ongoing losses and discoveries sometimes create anxiety or stress. In this sense, moving abroad together is reassuring.

Of course, it all depends on individual points of view. Solo expats will argue that moving provides a greater sense of freedom. Some might simply argue that they weren't in a relationship when they took the leap, so the question didn't arise. Couples dating before making the move may have their own reasoning. In any case, living abroad is a constant adventure. Whether you're moving solo or as a couple, you'll enjoy it even more by being emotionally and financially prepared.