How to avoid leaving Doha broke!


While the original article is published on Dubai’s Gulf News “How to avoid leaving Dubai broke”, the similarity of tax-free, expat life and consumerism between Dubai and Doha makes this article obviously still valid for Doha. I copy paste the original article below with a link provided to original site. Read on if you don’t want to be one of them. A lot of good advices too from the article and reader’s comments (check original site).

Dubai: If you earn Dh20,000 per month and have no money left in your account by month end, you are likely to retire from the UAE no better off than a tea boy.

Yes this is the sad truth for thousands of expats who come here with dreams of making big money, only to end up broke with hardly any savings to write home about, after years spent on living the high life or lured by shopping festivals and discount offers.

Those who succumb to the temptation to upgrade — to a nicer car, a bigger villa, pricier signature items — are in effect trading their present for a bad future, experts say.

Take the case of Richard, a European working in Dubai for seven years. The 42-year-old has no children, but has racked up a combined debt of Dh210,000 on five credit cards, and has a Dh90,000 car loan. His rent, food and bills take up most of his Dh24,000 paycheque, with nothing left at the end of the month.

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Dev, 40, a divorced airline executive, gets free accommodation and does not have a lavish lifestyle. But family commitments prevent him from saving anything.

He earns well, has no debt, but also has no savings — not even an emergency fund.

“When you come and live and work in Dubai,” Reg Ormond, managing director of financial advisory The Wealth Practice, said, “the attraction of tax-free earnings would suggest that the majority of people would build up decent savings to help them in their future.”

But the fixed costs of living eat into monthly salaries, according to Ormond, who runs free seminars on financial planning. “Large shopping malls and the ‘eating out’ culture — to name just two of Dubai’s attractions — take away whatever is left.”

The temptation to upgrade to a bigger apartment/villa, a nicer car — and the high cost of schooling for children — is also a constant challenge for expatriates.

So how does one get out of the rut? Ormond advises people to take a step back: “Accept that your time in Dubai with tax-free savings may be limited. Maximise your time here by listing your financial priorities.”

Most debt-laden expatriates have also had to part with their end-of-service (ESB) benefits, which banks collect at the first sign that a person has lost his job.


Pension fund

In 2010, UAE authorities and the International Labour Organisation discussed establishing a pension fund for expatriate workers to guarantee they receive their ESB.

In March 2012, a senior official of the Department of Economic Development in Dubai (DED) said they have completed a feasibility study for an expat pension fund, which was to be launched by end-2012 after clearance from relevant authorities. If pushed through, Dubai could become the first Gulf state to launch a pension fund for expatriates.

UAE lawyer Mohammad Al Suwaidi that a pension fund is a step in the right direction. “It’s a good idea, but it needs sound regulations from the start.”

Al Suwaidi said, however, that clubbing an employees pension fund with their ESB may be problematic, since by the definition an ESB is only due when an employee’s service comes to an end and grows over time as an employee’s salary rises.


Other experts also feel a pension fund would help protect expats in their old age.

Steve Gregory, managing partner of financial consultancy Holborne Assets Ltd. said most expats (especially Western) are capable of saving at least 10 per cent of their salary, but are reluctant to alter their lifestyle.

“There are some who spend a lot, get into debt and leave broke,” said Gregory. “This applies to younger Western expats and people earning less than, say, Dh8,000 per month who are struggling to survive, especially when they send money home for families.”

Gregory, whose career in financial services spans 30 years, gave a rare insight into the spending habits of UAE expatriates.

UAE-based Americans and citizens of G7 countries, he said, do save and invest at least four times the equivalent of their counterparts back home.

He cited the example of Andrew, a 55-year-old from South Africa, who moved to Dubai in 2006 with his wife Lea. The parents of two started to save $500 (Dh1,836) per month, and then grew it periodically. In recent years, Lea has paid all of her salary into their investment plan to prepare for retirement. Their joint investments now exceed $300,000, with three or four more years of saving before going home.

British expatriate Robert Keay, 56, managing director of customer service consultancy Ethos, blames the weather and the many “distractions”. “For much of the year it’s too hot to do anything else — either you stay at home or you can go to the mall. If you go to the mall, you don’t just go there to walk, you’re tempted to spend and buy things. “Expats also face the situation of paying everything in advance — rent, school, etc.

Many expats come from countries where there are no school fees. Not many people have the luxury of their company paying for these expenses so they end up borrowing money to pay for these things. People come here and they do not realise that you need to pay for a lot of things in advance.”

Another major culprit, Keay said, is the relatively easy access to credit cards.

“There’s no central database in monitoring the bank customers’ personal borrowings … it allows expats the opportunity to borrow too much money and too easily.”






Pay yourself first. Include savings in your budget. Investing in National Bonds is a good start (it prevents you from buying things you don’t need, like more expensive cars or accommodation).

Think of it as rescuing the old man/woman (you in future) from the follies of the young man/woman, (you today).

Saving between 10-20 per cent of your pay is a good guide.

Have emergency funds – between two to three month’s salary — in a deposit account

Diversify. Do not to put your ‘eggs in one basket’. Hierarchy of diversification: a) Cash in the bank is secure and accessible; 2) owning a property, which generally increases in value; 3) combine other assets classes such as stocks and managed fund, as these offer good long-term growth potential

Take financial advice. This is important to get a wider view of the options available for you (insurance, mutual funds, stocks, or a mix of these)

Live for today, but also plan for tomorrow. Life is about balance. Enjoy your time in Dubai, but work on personal financial plan

Balance your own interests against your family’s demands/needs. Due to cultural traditions among Asians, many send home a fair percentage of their salaries, which can sometimes be a drain and pressure on those people living here

Don’t buy a new car on mortgage, especially if your existing one still works fine



• There many types of insurance, but basic protection should cover income (or loss of it), health, life and investments. Buy insurance that works for you

• Some insurance packages also offer investment-like features, allowing you to gain from market growth while protecting yourself and loved ones



• Hedging is a way to guard against foreign exchange fluctuations. If you invest in a fund and the growth is good over a 12-month period but the currency moves against your base currency, then this growth could be wiped out.

• In Dubai, where the majority of people are paid in dirhams (fixed against the US dollar), a practical approach is to use dollar as the currency to start your savings. Then you could switch to your base currency in the future when the currency exchange rate is to their advantage, said Ormond



• Consider saving as a mandatory expense

• Open a savings account that’s harder to get to than your checking account

• Systematically (monthly) save to that isolated account on a regular basis

• Pair your raises with increase in savings

• Set milestones with rewards

• Write down expenses in three to six-month goals

• See where your money is going (A daily coffee may cost you only Dh12, but if you add that up over a one-year period, this could set you off Dh5,400)

Before buying electronics, jewellery or fashion items on impulse, wait 30 days (you might realize you don’t need those things at all. This could save you thousands by the end of the year)



Saver’s remorse is non-existent. No one complains of having money in the bank. But if you buy a new phone/item during a promotion, you may regret it soon afterwards


The Sign

One of the many du’a (prayers) I had made in Masjid Al Haram during my umrah last Feb is to have a good and succesful career at work.

Few days later, while I was in Quuba Mosque in The Prophet City of Madinah, a headhunter rang me. Not a good time. However, I gave a hint to talk briefly. She then talked about an exciting opportunity with a supermajor. I didn’t discuss much further and in detail about it owing to the situation at that time.

Will this be the sign? I don’t know.

During the last few months I have been a witness to departures of close friends to move to another companies: two went to UAE, one to Oman, one to Aberdeen, one to Saudi, one to Australia, and two to Indonesia. While it is normal thing to expect from a life of an expat, but still it left me with a question: what if I were they.

I am repeatedly comforting myself and I am afraid that I am creating a too-much comfort zone inside and around my life. Sigh.

Imaginary inner voice:  “Just go back focused to work Wahyu and get another Outstanding appraisal like last year!” 🙂

A How much? Encounter

If you are newcomer in Qatar, you may be shocked to get a straightforward question from a stranger: “How much is your salary?”


Been living in Doha for almost 5 years now, I should have been familiar. But still, I am shocked.

#1. I was in a tire shop; changing old tires. Engaging a conversation with the service desk personnel; from cars, tires, nationality, where i work until we finally came to an awkward and shocking situation (at least for me) when he asked how much salary did I get? Very straightforward.

My mom doesn’t even know.

#2. I was giving a ride to a worker from Ras Laffan Industrial City. As usual we’re engaged in a conversation. Until a time, “My salary is QRXXXX a month. How much is your salary sir?” Fortunately I could still control my car 🙂

Even I don’t want my boys know how much his father earns.

#3. I had a quick shopping in one of the Indonesian stores in Doha. A stranger caught me in a mere two minutes conversation. Again at the end, “How much? Ten thousand? Thirty thousand? or more?”

I am sorry. Not your business.

#4. A car accessory shop mechanic was installing roof mount DVD player in my car. I supervised him and unfortunately this got me into the same conversation ending. “Kam? (Arab: How much) Too much? (He tried to speak in a broken English)

My friend, don’t bother with what other grass looks like. Just focus to your job and you’ll get what you dream of.

Oh Doha.