Expat Advice: Financial Issues in Christchurch, New Zealand

What is the name of the city or town that you are reporting on?

Christchurch

Which banks do you use? If you have a local account, which bank do you use? How do you like it? Do you also have an account in your home country? Which bank? Do they charge for ATM withdrawals? Do they charge a lot for international wire transfers? How has it been working with them from abroad? Do you use a special international wire transfer service? Do you use an online bank? If so, tell us about them.

We switched banks, there are no major American banks represented here. We found out through an expat forum that National Bank of New Zealand would open an account for us before we arrived in New Zealand, which was extremely useful. Other banks here may do this now, but 4 years ago we couldn't find any other bank that would do this for us. I don't know of any other special services that the banks here offer that would be useful to expatriates. We change all of our currency through either an online currency trading firms (xe.com), or through a local firm we've discovered here in Christchurch.

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Traveling Mailbox serves thousands of travelers, expats, digital nomads, businesses, individuals and others in over 47 Countries by scanning their postal mail so they can view it online anywhere in the world. They provide customer service 7 days a week so if you need assistance, it is just a phone call away. Traveling Mailbox works with Evernote, Bill.com and Dropbox. And, there are Traveling Mailbox apps available for iOS and Android devices.
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What advice would you offer others about banking as an expat in your country? What do you wish you had known about banking when you first arrived?

Coming from USA, you'll be surprised (and annoyed) at all the sundry bank charges and fees associated with a typical bank account here. Compare charges/feew of different banks before committing yourself. If you're buying a house and you're borrowing from a local bank for the mortgage, you can negotiate a no-fees bank account. You can also negotiate all mortgage-related fees with the banks, and even the published mortgage interest rate can be negotiated down.

What sort of challenges or frustrations have you encountered as an investor living overseas? Please describe.

You need to know the tax laws of New Zealand - as an expat, you may be taxed on investment income or interest earned outside of New Zealand for instance, so if you have investments or retirement plans in USA (or wherever), you'll want to find out before you arrive here exactly how the NZ 'taxman' views these - NZ taxes are very high compared to the USA, while salaries are comparably lower here, and cost of living is significantly higher here. Challenge here is finding a way to survive on NZ salary paying NZ taxes. Mortgage interest rates are higher in NZ than anywhere else in the world, and can only be fixed for up to max 5 years - the rates have gone up about 2.5% in the past 4 years and could go higher yet. Unfortunately, (and quite the opposite to the USA) the cheaper fixed mortgage rates are the longer-term rates - the longer the fixed term, the lower the rate. Because the interest rates are so high right now (9.55% floating), the fixed rate for 5 years, which is the cheapest rate, is 7.95%. The 6-month rate is 8.5%. You never have peace of mind here with your mortgage, you always have to be thinking about it, making decisions about it, taking risks - very stressful.

What advice was particularly helpful to you in managing your finances? What advice would you give? Any other thoughts?

Find a tax accountant, or tax attorney, who has experience doing American expatriate tax returns, BEFORE YOU LEAVE USA. You will not find any tax accountants in NZ who are familiar with US tax law, and you will have a heck of a time trying to find one from within NZ. The time difference between USA and NZ makes it difficult to conduct business between the 2 countries by phone. So make a big effort before you head to NZ to find the best, most knowledgeable tax person you can back home, someone you're sure you can deal with from afar.

Do you do your own taxes, use a local firm, an expat-oriented firm or does your employer handle this for you (i.e. via an corporate tax firm)?

As above, for Americans there is no-one in NZ who can help with US tax filing. If one has any investments here (i.e. real estate), one really needs to use a local tax accountant for doing local taxes.

What advice could you offer others about doing your taxes as an expat?

Biggest headache here in NZ. We're still looking for a reasonably priced and knowledgable tax person who we can trust to do our taxes. But as it's so expensive to fly a family back to USA, we haven't been there for some years and are finding it very difficult, even after asking friends and family to help us, to find someone from here in NZ. I don't think anyone wants to find themselves in the situation where they're forced to use an unknown entity from a 'google' search.