Should I accept a job offer for R 450,000 per annum in Cape Town?

10POSTS

11 years ago

I am from India and have been offered a job in Cape Town that will pay R 450,000 per annum. I think the taxes are as high as 40% and Healthcare is as high as R3,000 per month. I am worried whether we will be able to rent a safe gated apartment in a safe area around Gardens and live comfortably with approximately R 28,000 per month after taxes and Healthcare deductions. After paying Rent, Utilities, Food, Gas and School fees; looks like the savings will not be more than R4,000 per month. Am I analyzing this wrong?

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Yankydoodle New member

4POSTS

11 years ago

Hi Ajay,
What you will be living on is plenty.
Rent a house in a nice townhouse complex with good security and you will be fine.
Cape Town is expensive, but shop around, and you will have plenty of spare change.
Enjoy Cape Town. A great place to stay in South Africa.

regards

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AjaySinghS Member

10POSTS

11 years ago

Thanks. I would like to hear other's thoughts. What comes to your mind if you were to live with R 450,000 per annum before taxes in Cape Town?

Sa11y Active member

34POSTS

11 years ago

You will be able to live for that - Cape Town i still a lot cheaper than Johannesburg (where as family you would need 2 cars, so that youf wife and kids are not stuck at home).
Cape Town has reasonable public transport, so 2 cars will not be necessary. If you were asking if you can live comforably for this in Johannesburg, I would say borderline, but in Cape Town yes.
Whether it is good enough pay for the job depends on type of the job you were ofered, but that's another story.
Bear in mind that salaries in Cape Town are lower than in Johannesburg, but Cape Town is a lot nicer to live.
Also - start from looking for a good state school (there are schools like that in SA too!) so that part of your salary is not consumed by private schooling which in SA can be very expensive. Once you identified couple of good schools, look for acommodation in "catchment zones" of those schools. Private schooling in SA can cost as much as 5-8k ZAR per month per child (in Johannesburg, Cape Town might be cheaper), so if you chose school and area carefully, you will be avoiding a lot of cost.
Good luck!

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Chrysalis Hub Member

1POSTS

11 years ago

Your take home would be around R22,500 pm..you then have to budget for health insurance, car insurance (all of which are quite high; when compared to India) ... then you have to take into account - house exp; school fees; travel costs; entertainment; holidays etc. A family cannot live in that amount. Not a good idea to accept the offer...unless your wife plans to work too.

Cape Town is 'THE' most beautiful city in the world (and that is an unbiased comment

)

All the very best

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36510 Active member

26POSTS

11 years ago

You could check for rentals e. g. here. Regarding school fees it depends on how many kids you have and what school you want to send them to. They can be pretty costly, e. g. see fees for the American International school.

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doc73 Member

3POSTS

11 years ago

Hi Ajay
If you are getting R450k (assuming this is without variable or bonus) then with around 33% tax rate you should get 25k per month.
I agree with a few of the comments below - specially that it is one of the most beautiful places to live in. And also that cost of living is expensive in SA. I stay in Joburg so not an expert on Cape Town but following are some of the costs that I think you will incur -
Rentals will cost around 8-9k for a 2 bed/1bath,
Utilities (since they are usually not part of the rent) - R1000 - 1400
Education - 1 child education R5-6k per month (R2.5k if the child is still in Pre-grades), Pvt Schools
Healthcare - base plan R2500/3000
Car EMI at least 4k for a mid segment car
Insurance is R800 for a car costing R120k
Maid - R140 per day (Joburg actual rate)
DSTV (cable tv) - 500 to 800 depending upon channels you take
On top of this you will have to account for groceries, eating out, petrol etc.

So if you see the disposable amount post expenses is quite low. Though all of the above needs to be normalized for the size of family, your preferences etc.
Plus, you will need to keep in mind the fact that getting admission to entry level grades (what we call in India upto Nursery) is very difficult. So you will have to check first if you are getting admission to any school. Sa11y correctly mentions below that you need to keep the school and house within reasonable distance of each other and also if possible around your work area.

Hope this helps. Let me know if you need more info.

Regards

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AjaySinghS Member

10POSTS

11 years ago

doc73 wrote:
Hi Ajay
If you are getting R450k (assuming this is without variable or bonus) then with around 33% tax rate you should get 25k per month.
I agree with a few of the comments below - specially that it is one of the most beautiful places to live in. And also that cost of living is expensive in SA. I stay in Joburg so not an expert on Cape Town but following are some of the costs that I think you will incur -
Rentals will cost around 8-9k for a 2 bed/1bath,
Utilities (since they are usually not part of the rent) - R1000 - 1400
Education - 1 child education R5-6k per month (R2.5k if the child is still in Pre-grades), Pvt Schools
Healthcare - base plan R2500/3000
Car EMI at least 4k for a mid segment car
Insurance is R800 for a car costing R120k
Maid - R140 per day (Joburg actual rate)
DSTV (cable tv) - 500 to 800 depending upon channels you take
On top of this you will have to account for groceries, eating out, petrol etc.

So if you see the disposable amount post expenses is quite low. Though all of the above needs to be normalized for the size of family, your preferences etc.
Plus, you will need to keep in mind the fact that getting admission to entry level grades (what we call in India upto Nursery) is very difficult. So you will have to check first if you are getting admission to any school. Sa11y correctly mentions below that you need to keep the school and house within reasonable distance of each other and also if possible around your work area.

Hope this helps. Let me know if you need more info.

Regards

You broke my heart about moving to Cape Town but it is good for me so, Thank you
I save 50% of my take home pay after taxes every month in India and that too after living in a 3bed/3 bath house in a Expat community. We eat out a lot, shop a lot, drive a good expensive car and don't really think twice about spending money and yet save half of it.

I think an Indian can never move to SA and live the same life and save the same money as they do in India unless their salary goes up 5 times.

I will reject the offer and enjoy living like a king in India. Thank You for your help. And for the record so other may know, you need a minimum of R 50,000 in a place like Cape Town to live and save comfortably with a family. What good is moving abroad when you can't save for your old age?

AjaySinghS Member

10POSTS

11 years ago

#10

Hi Everybody, I had given up on this but fortunately the offer has been revised to ZAR 650,000 a year. I figured I can bring home ZAR 40,000 post taxes. I am trying to convince myself that we can consider this offer as my daughter is at least 3 years away from starting school. I'd like to hear from all of you.

doc73 Member

3POSTS

11 years ago

#11

That should be good Ajay. Another 15k in hand will help.

Do your research around schools etc in advance. As the session is already on and depends upon which grade your child goes in. Remember, age of starting school here is a year higher than India so the kid will have to repeat a grade.

Also research on whether you would be purchasing a vehicle upfront or taking out a loan. If your visa is an ICT (which is usually 2 years) then getting loan can be hassle as they would only give the loan for that much tenure, which will increase your EMI payouts.

Let me know if you need more info.

Regards

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Kpapik Member

1POSTS

11 years ago

#12

are you please sure about the tax? based on this calculator (not sure if its right) the netto salary is close to 30.000, not 25.000.

can you please confirm that? thanks much!