Recently we caught up with Mark to discuss his personal experiences when first arriving in Australia as a UK migrant.
We spoke about his expectations, the unexpected hurdles and how he found the process of settling, both emotionally and financially, into his new life down under.
For many living in the UK, Australia is often perceived as providing a better quality of life and thought of as an ideal location to consider emigrating to. We asked Mark if this is something he can agree with and, if so, has he always felt the same way?
“I definitely agree that the lifestyle is much better than the UK and this is about the weather but also opportunities with beaches and hills readily accessible”, Mark explains.
“When you first arrive you tend to see yourself more like a tourist and over time this reduces, but the lifestyle always feels ‘easy’. That said, you still have to work but even going to work most mornings in the sun somehow improves your mood!”
Although, one thing about the weather did take Mark by surprise.
“The heat is generally not actually hot! I know that sounds crazy but, because of the exceptionally low humidity, 30-odd degrees is actually really comfortable. I remember going back to the UK for a visit and the temperature was 22 degrees and I was uncomfortably hot because of the humidity.”
Starting a new life on the other side of the world is, naturally, going to be a daunting experience. But some aspects may be harder than you’re expecting.
“I think that the transition to working here was easy and definitely getting used to the more laid back lifestyle, with an emphasis on the outdoor life and the importance of leisure time, was easy to get used to.
“However, although everyone speaks English (well, almost!), in many ways, it was hard to break into groups to make friends. School was one route in for us, but also work colleagues. When my wife was not working this was very difficult and homesickness was definitely an issue early on.“
Moving as a family also came with its additional complications for Mark.
“With a family emigrating, or in our case only part of our family, this definitely makes things more complicated. Dealing with schools and school years changing, qualifications that may not be dual recognised are all real matters to deal with and can be stressful. That said, 17 years on and I think the whole family have thrived and, arguably, gone beyond what they could have expected to achieve if they had stayed in the UK.”
The way the housing market operates in Australia is quite different to that of the UK.
“The housing market is much simpler and more transparent in Australia and I think it is so much better. Basically, you do not typically have a chain here so you buy and sell and bridge or rent if you need. Once you sign a contract and any finance clause is dealt with, it is typically unconditional. This means you have to complete it, unlike a massive “chain” that can fall apart any time up until the exchange.
“Many houses are also auctioned here, which is a little daunting and emotional, but it works!”
Let’s Talk Money
Mark’s reason for emigrating was a new job opportunity via his then-employer in the UK. We asked how much financial guidance he received during this process and after arriving in Australia as a UK migrant.
“The company provided a walk-in advisor to talk to us about superannuation in general and also some general advice on transferring my UK benefits. In this space, things are actually incredibly different here and, without this help, I am sure I would have made some really bad choices.”
Mark goes on to explain his financial situation when first arriving:
“We had very little in place, financially, before arriving. I had a job with a salary offer that appeared very generous and just some dollars that I exchanged pounds for at the local bank. Opening bank accounts was a priority on arrival though, as I knew that we would need a loan quickly. Registering for a tax file number (like the UK National Insurance number) can also be done quickly on arrival.”
Pensions vs Supers
There are big differences between how the UK’s pension scheme and Australia’s superannuations work, so we asked Mark for his thoughts on how best to handle this when emigrating.
“Regarding private pensions, you have a choice in that you can keep them there frozen and draw them here as a “taxable” income when you are eligible, or you can consider transferring them here after the age of 55.
“This is a big decision and needs to be considered on a case by case basis but, in general, there can be many tax advantages in moving them. But, again, this needs to consider your individual circumstances. Bear in mind, also, that if you do move them you need to be sure that you intend to retire in Australia as the decision is irreversible.
“With UK state pensions, these can not be transferred and are not means-tested (as the Australian age pension is). But they can be drawn and transferred here, when you are eligible, as taxable income. You can also choose to pay additional National Insurance contributions from here, to top them up for missing years, often at lower contribution rates.”
So would it be beneficial to keep your existing UK bank account active?
“I would strongly advise keeping an active bank account in the UK for many reasons, including dealing with any UK sourced income (including UK State Pensions), or holidays back in the UK etc. No doubt also that if you cancel these and then decide later to get them again, this can be very challenging. To me, this is a no brainer as you really do not need to routinely transact to keep an account open with a minimal balance.”
Becoming Financially Secure
As well as helping individuals, Mark also provides financial advice to small businesses. We wondered, is it possible for newly arrived migrants to start their own businesses in Australia?
“Starting a small business here is very easy indeed (just create an ABN), but, like the rest of the world, more than half will fail in the first year. Most people opening a business have an idea that they are passionate about but unfortunately have no idea how to run a business, and this is the same the world over.
“I do work with small businesses to try to help them understand this. One of the most common challenges is to completely separate personal from business income and, in my view, this is absolutely paramount.”
After living here for over 17 years now, does Mark believe it is easier to make money for yourself in Australia and work towards becoming financially secure?
“No doubt that salaries here are often considerably higher. The cost of living can be deceptively high though, but I would say that overall you have a better opportunity to achieve financial freedom here provided you learn the golden rule of Pay Yourself First. This means that you pay yourself at least 20% of your income (consider it a tax!) and invest this money wisely.
“Remember that good investing is not gambling and, if done well, will always go forward in the long term.”
How long had Mark been living in Australia before feeling that he fully understood and was in control of his new financial situation?
“I think that this was probably three years in our case as we were not permanent residents until this point. You have to get over the constant conversion of costs back into pounds and you learn that this is not really helpful as you are not paid in pounds!
“Regardless, it will take time to settle and then financially settle.”
Become Part of the Community
What are the benefits of becoming permanent residents of Australia? Is this process a personal choice, or are all migrants required to become citizens after a certain amount of time spent living in the country?
“I think it makes sense to become an Australian citizen, but it remains a personal choice without a time limit. For me, the key factors were that we could be joint citizens; we would not lose UK citizenship but that we could participate as real citizens here, including voting in elections, etc.
“You also need to be aware that, as a resident after a certain time, you need a return resident visa to travel overseas. We now only have Australian passports but, if the need was there, we could renew our British ones.”
Finally, we asked Mark to think back to when he first arrived in Australia. What would be the best piece of advice he could give to himself, knowing what he knows now?
“Take your time, don’t rush irreversible decisions. But once you are sure, go full steam ahead. Make sure you fully become part of the local community and really embrace the country and its people!”
Can you relate to Mark’s experience of arriving in Australia as a UK migrant?
Find out how much you truly understand about your financial situation here with Mark’s Australian Money Checklist.
Baldwin Financial Services is based in the northeastern suburbs of Adelaide.
Contact us to find out how we may be able to help you.