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How Indians can better manage their finances in the US? 5 Tips
As the cost of living in India and United States differs across several parameters, Indians living there share tips on how to manage expenses.
Most of us tend to convert foreign currency to Indian rupees using the current exchange rate. But as the cost of living in both countries could differ significantly, it is not prudent to convert any income/expense directly with the exchange rate. Because a $100,000 salary in the US gives a standard of living similar to what India offers for just ₹23.14 lakh (based on purchasing power parity).
The Hindustan Times sister publication- Mint talked to some Indians residing in the US to know how the manage their living. Here we list down some tips they have shared on how to better manage finances in the foreign country.
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1) Kiran (34), who resides in the US for more than a decade advises not to convert every expense to rupees. He is a car enthusiasts and according to him cars are cheap in the US.
A premium car priced at ₹75 -80 lakh in India would cost $50,000 -60,000 in the US. Buying that car on loan in India and settling monthly instalments on that would take away huge some of salary. But in the US, buyers can keep monthly EMI under 10% of take-home salary, he states.
2) Kiran further adds that it will be huge cost-cutting if one can manage their daily chores themselves. Labour charges are too high in the US. In India, what would charge just ₹3,000 for a helper who looks after the house and does the dishes, in the US, a housekeeper asks about $30-40 for just two hours per day, he states.
3) Uma Shankar (30) who lives in Texas advises to set aside a prominent portion of your income for savings. He suggests to build a good credit score as it is linked with the social security number (a numerical identifier issued to residents in the US), which has to be given for almost all financial activities, like subletting a home, purchasing a car, etc.
4) Bala Manohar (33), who aims to live in the US only till he makes enough savings, suggests to invest savings in India. The substantial benefit of the exchange rate can be tapped if dollar savings are spent or invested in India, he states.
5) For married couples, if both the partners earn in US currency, then shared costs can mean higher opportunities for savings.
Saketh Varma (30) who is accompanied by his wife Sindhuja Jagarapu, warns that it takes a lot of time for dependants to get approval to work in the US.
Saketh also adds that staying in US gives him opportunity to learn new technologies before the world catches up. Thus, from a technological point of view, for him, US is the best place to live in.
