Budgeting

Budgeting for Budapest is top of mind for my husband – and rightly so.  We want to avoid expats mistakes that we’ve heard other people have made.   While we are both lucky enough to be able to work remotely and have that work continue – not all of our work is remote.  For us, moving to Budapest means a drastic cut in our dual family income – and with that comes a monthly budget.

To tell the truth, neither of us have ever been big budgeters before… but we sure are now.  We use resources like Numbeo for Budapest to help us gage our monthly living costs along with other research done on Facebook.  To see my recommendation for the best Budapest Facebook Groups, read this post. As of October 2017, the cost of living index in Budapest is 32.21% lower than my hometown of Toronto, Canada.

The 3 Top Expat Mistakes when Budgeting

1. Not budgeting for the cost of international shipping.

If you can fit all your belongings into two suitcases then you don’t have to worry about this too much.  If it is a company transfer or job offer, its likely the corporation will pick up the bill. However, if you are moving by your own choice midlife like we are, or you’re moving to retire in Hungary, its likely you have more “stuff” you want with you.  Especially if you are planning to be away for more than a year or two.

We had a garage sale in preparation for our move and sold all of our bigger items through online marketplaces, so we will not be moving any furniture or cars.  However, the smaller stuff still adds up.  We have boxes of china, crystal, decor items, paintings, stereo equipment (yes it will all work with 240v), a bicycle, purses, shoes, clothes, tools and more. In total, we will be moving about 190 cubic feet of precious (to us) cargo.

Our belongings will make the journey via container ship and should arrive about six to eight weeks after we do.  The shipment is considered “household goods” and thus duty-free. But don’t be fooled, the total cost of door-to-door shipping with insurance for our smaller amount is around $8000 – even without duty or import taxes. You really need to crunch the numbers to see if its worth it. It may be cheaper to simply purchase everything new on upon arrival. Furthermore, the shipping company will want all the money upfront sent via international bank wire.  No putting it on your credit card and worrying about it later!

2. Living like a tourist upon arrival

Hand decorated gingerbread cookies at the Christmas Market Stands.

We are really excited to be arriving in Budapest at the start of the holiday season.  We have never been in Budapest for Christmas and are looking forward to the famous Christmas Markets, mulled wine, marzipan and hot pálinka.  The temptation to go crazy buying holiday items, food, wine, gifts and attend special events is strong. However, we know we need to keep to our budget for any unexpected items that may creep up.  We can not live like we are on holiday.  Unexpected charges could be anything from lawyers, rents, visas, permits – not cake and champagne.

Since we know we want to participate in some of the many the holiday events in Budapest, we included those bigger tickets items into our first month’s budget.  Moreover, we are able to purchase tickets in advance or make reservations online from Canada for the Nutcracker Ballet, La Bohéme Opera and our Christmas Brunch at the famous Gundel Restaurant.

3. The cost of Health Care

Hungary has a tax-funded universal healthcare system, organized by the state-owned National Health Insurance Fund. But don’t assume that because you are moving to Hungary that you will automatically have access.  As mentioned in this post, I am a dual Canadian-Hungarian citizen and my husband is British.  You would think this gives us access to a EU health-care system – but if you do, you would be wrong.

Since I have never lived in Hungary, I have not yet paid any taxes.  Since the health care system funds itself by taxes, I do not qualify and this requires me to get a private plan.  The same goes for my husband.  Since he has been in Canada for many years, he does not quality for his EU card which would typically allow British citizens access to the healthcare system. Both of us will need a private plan for this first year or until we perhaps work with a Hungarian employer.

However, if we are employed, the Hungarian company will pay this health care fee for us.  Consequently,  if we remain independent consultants, we need to foot the bill. The good news is, this cost is not exorbitant and a wide variety of plans and providers are available. After a our first year, we are able to “buy” into the social system and use it like any other citizen.

Interesting: Hungary is one of the main destinations of medical tourism in Europe and has excellent medical and dental services. According to Wikipedia, the most popular medical treatments are dentistry, cosmetic surgery, orthopaedic surgery, cardiac rehabilitation, fertility treatment, dermatology, anti-aging treatment, obesity treatment, addiction programmes and eye surgery.

Of course there are other financial considerations to make – personal, business and property tax rates, pensions, bank accounts, life insurance, etc. If in doubt, speak to your accountant before you leave – and find a good one upon arrival.  We are planning to meet with an accountant I found via Facebook.  To find out my favourite Budapest Facebook groups, read this post.