t1nners

After some mucking about with a proposed role in KSA, I have now been offered an IT Director role in Dubai for a multinational company. Currently doing similar role in UK on ~100GBP basic + car + bonus.

As many people before me I am completely blind as to the validity of the offer versus cost of living in Dubai.

Have done some research, including filling in sheet here http://britishexpats.com/forum/sand-.../#post10105648
but that is now a few years old.

However, when I add it up it gives me a deficit of 40k local:
AED Annual AED Monthly
Income
704,500 58,708
Expense
744,400 62,033
+ or - ?
-39,900 -3,325

Attach the breakdowns.

My questions would be:

• Do the costs look valid still ?
• Is it really unrealistic to live comfortably in Dubai on equivalent of net £140k GBP / year
• Is the offer valid for that kind of role ? (appreciate this is v speculative)
• What else do I need to factor in ?
• Is there anyone (consultancy / company etc) who can offer paid help to support how we make this cost / benefit decision ? Don't want to uproot the family and end up living a difficult lifestyle in Dubai.

Thanks a lot for any help you can give

Millhouse

what has been the offer in AED/month?

My guess is that you'll burn off around 45k / month as family of four all in. (including school fees/cars etc.).

t1nners

It's 58,708 all in or 48,833 excl. bonus

Income Per Month (AED)

Basic Salary 39,500
Bonus (up to 3* mthly) 9,875
School Fees 6,833
Car 2,500

Total Income 58,708

Millhouse

School fees are about 2/3 of what they need to be
Never account for or assume a bonus. That needs to be real money.
If it was 50k + proper school fees it would be ok. Less than that and I'd be asking questions.

Don't forget that the exchange rate has dropped 20% in the last 3 months. Don't think in GBP

Meow

For a role at that level I'd expect to see school fees fully covered by the company. That's often the final straw that makes people leave as they increase every year so I'd suggest you renegotiate to have the fees paid in full.

As Millhouse says, ignore the bonus and don't think in Sterling. Costs are different here.

You also need to factor in the cost of moving, the set up costs (all kinds in incidentals creep in) and how long you will stay. Just moving to the UAE doesn't automatically mean you are no longer liable to UK income tax. There are factors to consider for this. Also don't forget that your UK employer is probably making pension contributions for you and here you'll need to make your own provision. (The End of Service Gratuity is not adequate replacement for a pension or retirement plan and can be reduced in several circumstances.)

Make sure you read any offer and contract of employment very carefully. Fixed term contracts are different to unlimited. The latter gives more flexibility.

Good luck.

t1nners

Thanks for the replies Meow and Millhouse.

I think based on what I have looked at and your advice that I should be looking for minimum of:

Package
Salary inc car 600k [Up from the 510k offered]
School Fees 100k [Up from the 75k offered]
+ Bonus

This is based on

Key Expenses - annual
Schools
Schools and Trips 100k
Other
Accomodation 200k
Flights home 50k
Holiday 40k
Utilities 30k
Pension 30k
Cars / Fuel 25k
Other living costs such as food, going out, clothing, saving etc. @325k

TOTAL 600k + Schools 100k

This is plus the one time setup costs.

What's the thoughts on the forum in terms of relocation consultancies for support on benchmarking, school / accomodation search etc ?

Thanks

Millhouse

How much do you currently save? You obviously want to save more here.

They will also negotiate with you.

t1nners

So I have redone the costs (got a copy of the Mercer Dubai cost of living report) , and spoken to them again about the offer.

Top they can go is 45k/m plus school fees + bonus

Unfortunately for the 4 of us the costs I have got to including pension contribs and savings is 59k/m (67k incl. schooling)

Are my costs wildly out or is the offer really 15k/m too low ?

I am not looking to live like a king, but just to have a good quality of life living in a 3 bed villa in a decent part of town, and with enough disposable income to enjoy Dubai for family of 4. My wife may well get a job, but I don't want to count that in.

Thanks

NorthernLad

Where are you looking to live?

You could easily knock 50,000 dh a year off on housing and by dumping the maid, still have a nice place to live.

Tell the wife and kids they can have one trip home in the first year.

t1nners

Thanks - we thought Arabian Ranches, The Springs or Sports City ? Not sure really, plan to come out for a visit in September.
Maid is definitely optional, wife quite keen though

DXBtoDOH

You can find 3 bedroom villas in the Springs for 160-170K. Or JVT/JVC.

Mirdiff for even less.

But regardless of what you rent, you have to pay a 5% agent's fee, plus another 5% deposit, plus deposits for the utilities (2,000 I think).

Your school fees are on the lowish side. I'd budget at least 50k each. And they go up rapidly from that. What is the company offering towards school fees?

As for the maid, they're nice to have but also a pain. 2,000 a month is on the low side for a decent Filipino maid (which everyone wants). You also haven't factored in the sponsorship costs. I'm not totally up to date on maid expenses but I've heard around 30-40K for the year, including sponsorship costs and salary and health insurance. Probably a lot easier to have a weekly cleaning crew who come in for four hours once a week to do the heavy cleaning. This will probably cost around 600-700 per month.

I assume the 10K a month for clothes/entertainment will also cover holiday expenses?

You may not want to hear this, but have you considered getting a big 3-bedroom apartment instead? Much lower utilities bills. The buildings will have pools and gyms. The Greens seem to have a bunch of big 3-bedroom apartments for 150-175K and it's a lovely community and very family friendly. And much more convenient than stuck in a villa out in Dubailand. It's definitely something to consider for your first year in Dubai before you commit to the expense of a villa.

Another point regarding cars: Do you have existing cars you can sell and use to pay for new cars in Dubai? Get a used family Pajero (3-4 years old) for 60K in cash, so no monthly payments and they're very reliable. Another expenditure halved.

t1nners

I think that is spot on advice regarding the apartment. I am not great at compromise but it also makes sense given the family won't join me for 2/3 months.

75k for the 2 rising to 90k from next year plus 7k for the school bus.

I have assumed that if I get a bonus (is part of the deal) then we will holiday if not it's a trip back to blighty

The company have a deal on the cars.
Like most people we don't own our cars in the UK we just "borrow" them from the finance company !

NorthernLad

Good advice - its far easier to upgrade where you live after a year than find out you are paying over the odds and having to reassess your situation to save money.

We're probably going to move early 2017, we've been looking at the rental prices and there seems to be a decrease in rental costs for villas. I expect this will continue as it becomes clearer how many people have returned after the summer, and those still here reconsider their outgoings due to a degree of uncertainty with the economy.

DXBtoDOH

I've stared at your numbers till I'm blind in the eye. And I have too much to do today, so why am I doing this

To be honest, something is going to have to give. Reducing your housing expenditures to 21K a month by forgoing the maid and living in a cheaper property (15k month) with lower housing tax, still means that you end up spending 53K with no change to your expenditure category. And you still haven't budgeted what you need for topping up on school fees.

The problem is that you want to save 140K in pension/savings. On your package that's not doable. Without the pension/savings, your expenditures are 20K. Add that to the lower estimate for 21K for housing, you're still spending 41k altogether. The remaining 4K left of your salary will go towards topping up on school fees for the most part.

You can make it work if you don't mind not having savings. But the real problem is that in your situation, a family with two kids in school, you are very exposed to school fee increases (goes up every year) and wild swings in rental prices (too common in Dubai). You can make the package work for a year, maybe two, but odds are you'll be on the plane back to the UK by year 3 unless you find a higher paying job or the wife gets a job. And you'll go home no richer.

Many women do work in Dubai, FYI. If your wife gets a job making 10-15K a month in some admin/HR position, that's where your savings will come from.

t1nners

Well a big thank you to all who helped in this over the last few weeks.
I have secured a better package which gives some savings and a bit of breathing space.

Am now planning how the hell to get in country by latest December. That will be my next post for help !

A lot to do.....but very exciting times......