foreign http://www.wisebread.com/taxonomy/term/8797/all en-US Live Abroad for Less (Also at Home) http://www.wisebread.com/live-abroad-for-less-also-at-home <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/live-abroad-for-less-also-at-home" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/resort-beach.jpg" alt="Resort Beach" title="Resort Beach" class="imagecache imagecache-250w" width="250" height="205" /></a> </div> </div> </div> <p>Look around and you'll find any number of articles on living abroad for less. Some are full of great ideas &mdash; but of those great ideas, only one is uniquely applicable to living abroad. All the rest work just as well at home.</p> <p>The one thing that sometimes makes living abroad cheaper than living at home is a preferential exchange rate. If your home currency is strong &mdash; and if your savings and your income from work or investments are in your home currency &mdash; then someplace with a weaker currency can be a really cheap place to live. But pretty much all the other &quot;live abroad for less&quot; ideas are just as applicable to frugal living in your home country.</p> <p>Besides the exchange rate, what are the attractions that make living abroad seem attractive? Here's a short list.</p> <h2>Stuff is cheap where people are poor</h2> <p>If you go to a place where people are poor, things are going to be cheap. Besides that, everything is going to be set up so that people can get by without a lot of money &mdash; because that's what everyone is doing.</p> <p>Well, guess what? There are poor people where you live now. Just as in a poor foreign country, in the neighborhoods where the poor folks live things will be arranged so that it's possible to get by without a lot of money.</p> <p>Many of the poor neighborhoods in your home country are places that you wouldn't want to live, but that's beside the point &mdash; many of the poor countries around the world are places you wouldn't want to live either. All you need to find is one safe place where food and rent are cheap because that's all the locals can afford.</p> <h2>Interesting culture provides free entertainment</h2> <p>There are two general categories of people who seriously consider living abroad. Some are purely looking for someplace cheap &mdash; they have no interest in interacting with foreigners, except perhaps as servants. For others, though, much of the draw is living someplace exotic.</p> <p>If you're the latter sort, then learning a new language, eating new foods, seeing new art, and just hanging out with people whose world-view is different can make everyday life so interesting you don't mind giving up the nice-but-expensive stuff that makes living where you live now expensive.</p> <p>Once again, guess what? Unless you live in a truly homogeneous place, there are people with different cultural backgrounds in your home country too. They might not be particularly thrilled to have you show up and treat them like a source of free entertainment, but then the ones in foreign countries probably feel the same way (even if they hide it a bit better because they need the foreign exchange).</p> <p>Those neighborhoods do exist, so if what you want is a place so interesting that you can lose yourself in its exotic charms, visit a few.</p> <h2>Excess baggage left behind</h2> <p>Most people who live abroad don't bring a houseful of possession, so they can live in a small apartment. All over the world, most big cities have some sort of public transit, so it's possible to get by without a car.</p> <p>If you've caught onto the point I've been making here, you won't be surprised when I point out that you can do this in your home country as well. Even in the U.S., where public transportation isn't as comprehensive as it is some other places, there are plenty of cities with excellent public transit systems. (Anyway, all you need to find is one residence from which you can get to all the places you need to go. Those can be found even in places with mediocre public transit.)</p> <p>If you're ready to get rid of your car and most of your stuff (that is, if you're the sort of person who might seriously consider moving abroad), then you can do so in your home country as well.</p> <h2>Real estate prices are low</h2> <p>If you're coming from a place where real estate is expensive, any particular foreign country may have remarkably low real estate prices. This is largely a specific example of &quot;stuff is cheap where people are poor.&quot; Buying a cheap place to live is a hugely powerful enabler of a cheap lifestyle: It's even more powerful than a favorable exchange rate, because once you buy your costs are relatively fixed (unlike the exchange rate, which can be expected to fluctuate).</p> <p>In a rich country, especially a small, rich country, there may be no cheap real estate. In any case, there probably won't be any cheap real estate on a bus line in a big city. Still, it's worth pulling the pieces apart and looking at them individually. In the United States, for example, there is plenty of cheap real estate, as long as you don't need to live near a city. Even in cities real estate prices are down sharply from the peak of the bubble.</p> <p>Abroad or at home, renting is often cheaper than buying. You do lose the permanent cost savings that comes from buying cheap real estate, but you also avoid the permanent expense drag that comes from buying expensive real estate.</p> <h2>The whole live-abroad thing</h2> <p>If you're not the sort who might be attracted to the &quot;live abroad for less&quot; idea, there won't have been much here to grab your interest. But I do have a point, and it is not that you should give away all your stuff and move to a slum, even if that would replicate pretty well the experience of a lot of people who try to live abroad for less.</p> <p>My point, rather, is this: If you're the sort of person who might consider living abroad, you're the sort of person who's willing to consider making big changes. And if you're willing to make big changes, you can live very frugally in your home country.</p> <p>Obviously, there are huge upsides to staying in your home country: You know the language, laws and culture; you don't need to get a visa or a work permit; moving costs will be relatively low.</p> <p>If you are drawn to the notion of living abroad, think about why. Is it the low cost? The interesting people? The beaches (mountains, rain forests, tropical weather)? Is it the exotic food? The adventure? The opportunity to completely change your life?</p> <p>Depending on exactly what is really motivating you, many of those things will be available, in some measure, in your home country. In particular, <a href="http://www.wisebread.com/designing-your-life ">you don't have to go away to change your life</a>; you just have to have enough gumption to make the change.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/philip-brewer">Philip Brewer</a> of <a href="http://www.wisebread.com/live-abroad-for-less-also-at-home">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-travel-full-time-for-17000-a-year-or-less">How to Travel Full-Time for $17,000 a Year (or Less!)</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/volunteer-to-travel-11-opportunities-for-free-or-very-cheap-travel">Volunteer to Travel: 11 Opportunities for Free or Very Cheap Travel</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/11-simple-rules-of-excellent-houseguest-etiquette">11 Simple Rules of Excellent Houseguest Etiquette</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-get-free-accommodations-and-paid-jobs-on-boats">How to Get Free Accommodations (and Paid Jobs) on Boats</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/sleeping-in-airports-for-the-stranded-and-frugal-minded">Sleeping In Airports For The Stranded And Frugal Minded</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Lifestyle Travel foreign live abroad Wed, 14 Apr 2010 13:00:03 +0000 Philip Brewer 19342 at http://www.wisebread.com What if foreigners quit lending the US so much money? http://www.wisebread.com/what-if-foreigners-quit-lending-the-us-so-much-money <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/what-if-foreigners-quit-lending-the-us-so-much-money" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/foreign-currency-and-coins_1.jpg" alt="Foreign currency and coin" title="Foreign Currency and Coin" class="imagecache imagecache-250w" width="250" height="165" /></a> </div> </div> </div> <p>One of the bugaboos of the financial doom-and-gloom crowd is the worry that foreigners (China in particular, but also oil exporting countries in the Middle-East, and others) might quit buying so many US Treasury securities.  If that happened, they say, the value of the dollar would plummet, interest rates would soar, and the US economy would be in terrible trouble.  I say:  Bring it on!</p> <p>I&#39;m not the only person who isn&#39;t worried about this.  Quite a few people take some comfort in the idea that dumping Treasury paper would hurt the major foreign holders worst of all, and that they&#39;d never shoot themselves in the foot that way.  The doomsters retort that, given the inflation rate, the exchange rate, and the prospects for the US economy, it may well amount to the same thing either way, but that by selling, foreign holders of US paper could at least get something.</p> <p>My own take is that the whole analysis is wrong.</p> <h2>What would happen?</h2> <p>Remember that the US isn&#39;t a bank--the government sells bonds, it doesn&#39;t take deposits.  Foreign holders of dollars can&#39;t show up and demand their money back.  All they can do is sell the securities they&#39;ve got.  (And, of course, quit buying more.)</p> <h3>Interest rates</h3> <p>Obviously, if major holders started unloading their treasury paper, the prices would plummet and interest rates would soar.  That would make it expensive for the US to borrow new money, but it wouldn&#39;t affect the government&#39;s cost for the money they&#39;ve already borrowered.  In any case, borrowing large amounts of money is just a policy decision by the Bush administration and the Congress.  As recently as 2000 the US government was running a surplus.  With the economy slipping into a recession, it would be harder to run a surplus now, but the current large deficit is entirely optional.</p> <p>Besides making it expensive for the government to borrow large amounts of money, higher interest rates would make it more difficult for everyone else to borrow money as well.  On the other hand, it would make it quite profitable for people to save and invest money.  In fact, once the government got its fiscal house in order (something that wouldn&#39;t really be optional in this scenario), we&#39;d see the exact reverse of what the doomsayers predict--treasury paper would become a highly prized asset.  People who bought it cheap when foreign governments dumped it would make huge profits.</p> <h3>Exchange rates</h3> <p>You&#39;d see similar results in the foreign exchange market.  The value of the dollar would drop, making imports more expensive, but making exports more competitive.  </p> <p>The US (because it is large and well-endowed with both natural resources and skilled workers) could actually produce most of what it needs domestically.  The only reason it doesn&#39;t do so is that imports from low-wage countries are so much cheaper.  </p> <p>Of course, producing more of what we use would cost more--the consumer has had it great over the past 30-odd years of globalization, getting all sorts of cheap stuff that would cost a lot more if it weren&#39;t imported from low-wage countries.</p> <p>The result would be lower standards of living, but it wouldn&#39;t be a catastrophe.  And, there would be winners as well as losers.  Manufacturers would come out ahead, as would farmers and workers.</p> <p>As the US dollar falls, the price of everything that trades in global markets (for example, corn, wheat, and soybeans) rises.  (We see that already.)  Since we grow a lot of those commodities, we benefit in about equal measure to our losses--the raw materials cost more, which means the stuff we buy costs more, but the producers earn more, so they have more money to spend.  </p> <p>One major exception, of course, is oil, where we use far more than we produce.  The price of oil would obviously soar in this scenario, hurting everybody.  But that&#39;s going to happen anyway.</p> <h2>Positioning yourself</h2> <p>I don&#39;t think this is a likely scenario, simply because (as I described at the beginning), dumping treasury paper would hurt the foreign holders of it most of all.  Still, it&#39;s not an impossible scenario, so it&#39;s worth looking at how you&#39;d want to position yourself against such an eventuality.</p> <ul> <li>First, you&#39;d want to be sure not to be in debt, especially not variable-rate debt.  Interest rates would shoot up, making debt even more expensive than it is now.</li> <li>Second, you wouldn&#39;t want to be in a business that depended on cheap imports.  (At the moment that&#39;s most businesses.  Some, though, could quickly move to local sourcing of their inputs, while others would find that difficult or impossible.)</li> <li>Third, you&#39;d want to minimize your household&#39;s dependence on the sort of imports that would become much more expensive.  The hard one here is fuel.  (Your house or apartment is probably full of imported goods, but you&#39;ve already got them and won&#39;t be harmed if their price soars.)  I&#39;ve talked before about <a href="/plan-for-expensive-fuel">preparing for higher fuel prices</a>.</li> <li>Finally, expect a lower standard of living.  Americans have enjoyed a high and rising standard of living for years, through a combination of individual borrowing (especially against homes), government borrowing (which has let the government fund an expensive war while lowering taxes), and globalization (importing goods from low-wage countries).  This scenario would just mean that they&#39;d come to halt abruptly, but they&#39;re coming to a halt in any case.</li> </ul> <p>Regular Wise Bread readers will have noticed that these are generally the same recommendations that we make anyway.  That&#39;s the reason for my somewhat flippant call to &quot;bring it on!&quot;--we&#39;re already ready.</p> <p>A quick transition to a world where everyone had to live within their means would be rough--homes would be lost, jobs would be lost, businesses would be lost.  But we&#39;re heading there anyway, so it&#39;s just a matter of whether the transition will be fast or slow.  As individuals, we have the opportunity of starting the transition now--ahead of everyone else.</p> <p>I suggest you make the most of it.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/philip-brewer">Philip Brewer</a> of <a href="http://www.wisebread.com/what-if-foreigners-quit-lending-the-us-so-much-money">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/wage-slave-debt-slave">Wage slave, debt slave</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/self-sufficiency-self-reliance-and-freedom">Self-sufficiency, self-reliance, and freedom</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/join-america-saves-week-february-24-to-march-2nd">Join America Saves Week February 24 to March 2nd</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/tips-for-increasing-your-financial-literacy">Tips for Increasing Your Financial Literacy</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/another-path-to-recovery-higher-incomes">Another path to recovery: higher incomes</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Frugal Living Debt Management debt foreign foreign currency treasury securities Tue, 08 Apr 2008 20:43:41 +0000 Philip Brewer 1991 at http://www.wisebread.com Foreign exchange class action settlement http://www.wisebread.com/foreign-exchange-class-action-settlement <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/foreign-exchange-class-action-settlement" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/credit-cards_0.jpg" alt="Credit cards" title="Credit Cards" class="imagecache imagecache-250w" width="250" height="178" /></a> </div> </div> </div> <p>Did you travel overseas between 1996 and 2006? Or, did you charge anything on a credit or debit card in a foreign currency? If so, be sure to claim your share of a class action settlement over allegations that credit card companies conspired to set and conceal the fees they charged for foreign transactions.</p> <p>This one is real, folks--not a scam. </p> <p>To see the gory details, and to file your claim, check out the <a href="http://www.ccfsettlement.com/">Currency Conversion Fee Antitrust Litigation website</a>:</p> <blockquote><p> <a href="http://www.ccfsettlement.com/" title="http://www.ccfsettlement.com/">http://www.ccfsettlement.com/</a></p> </blockquote> <p>Your main options:</p> <ul> <li>If you had at least one foreign transaction, but spent less than a week overseas, you can file for a $25 &quot;easy refund.&quot;</li> <li>If you spent more than a week, or had foreign transactions of more than $2,500, you can get a &quot;total estimation refund,&quot; based on a rough estimate of how many days you were overseas and what kinds of travel you did.</li> <li>If you have pretty good records of how much you spent overseas during that decade, you can provide the details and get back 1% to 3% of your foreign charges.</li> </ul> <p>You&#39;ve got until May 30th, 2008 to file your claim.</p> <p>There&#39;s no way to be sure how much money you&#39;ll get--the refunds come from a limited pool, and if lots of people claim shares there&#39;ll be less to go around. But that&#39;s no reason not to claim your share.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/philip-brewer">Philip Brewer</a> of <a href="http://www.wisebread.com/foreign-exchange-class-action-settlement">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/15-airport-hacks-from-professional-travelers">15 Airport Hacks From Professional Travelers</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/our-worst-financial-mistakes-and-what-you-can-learn-from-them">Our Worst Financial Mistakes and What You Can Learn From Them</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/73-easy-ways-to-save-money-today">73 Easy Ways to Save Money Today</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-auto-payments-can-screw-you">7 Ways Auto-Payments Can Screw You</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/do-we-really-need-help-in-getting-more-debt">Do we really need help with getting more debt?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Travel class action suit credit cards foreign Wed, 20 Feb 2008 17:27:45 +0000 Philip Brewer 1821 at http://www.wisebread.com