Last updated on May 28th, 2020
On a bright Sunday afternoon, I got a call from my friend, Raj. After the initial pleasantries, he broke the news.
“Hey buddy, I got my Australian PR!”.
“Wow, that’s fantastic news! You must be feeling on top of the world” I said.
“Yeah I was for a moment, but now I am worried. I have a few questions. Can you help me please?” He said.
“Of course, I will. Tell me what you want to know” I replied.
“I heard Australia is a very expensive place. How much money should I bring to Australia? In what form can I bring that money to Australia? Is there any limit on cash that I can bring to Australia? Do I need to pay tax for that in Australia?” He fired away.
“Hey, hey, hold your fire. That’s a lot of questions in one sentence. Let me answer them one by one.”
You must have faced the same scenario when you planned to come to Australia, isn’t it? I don’t blame Raj for his confusion. There are so many questions when it comes to bringing money to Australia. Like my friend Raj, you will be worried and confused as to what is the right way to do it. No worries, mate! I will help ya.
How Much Money Do I Need To Carry To Australia?
Honestly, bring as much money as you can. Australia is expensive and you have to survive on your own without a job for a significant amount of time. Staying in a foreign country, with no one to talk to, without any job at hand in itself, is highly depressing. You don’t want to add to your worries by bringing the meagre amount of money to barely support you.
Keep in mind – cracking the first job takes time, 3-4 months is the average for IT industry and different for other industries. 6-8 months is the worst case. To prepare for the worst, you have to carry sufficient money which will last for at least 6-8 months. Depending on a few factors, this amount is going to be different for each one of you:
If you are living in a city like Sydney, the monthly rental cost can easily go up to 2000$ or more depending on how close you live to the CBD and I am talking about just room sharing. In the case of Melbourne, if you rent a unit or house in a not so distant suburb from the city, it can easily cost you around $1500 to $2000 per month. Add to that the cost of the bond which is usually one month worth of rent. There is one more twist. Since you will be a newly arrived migrant, you won’t have any rental or credit history. This can make it hard for you to get a rental house. You may have to make up for it by paying advance rent. Paying six weeks worth of rent in advance is not unusual to secure a house. If you have a shoestring budget, you don’t have many options. Either you will have to live in the farthest suburbs or shorten your stay, neither option is sustainable. So having strong financial support helps a lot.
For a city like Melbourne, if you live within CBD you save on travel cost because travel within CBD limits is free. However, the same may not be true for other places. Also, sometimes it more sensible to live in the suburbs and save on rental cost rather than saving on public transport. But you have to consider transportation cost to decide your budget.
Groceries & Eating Out
As is with any metro city, you will save a lot if you limit eating out. You can find cheaper options for groceries and vegetables, but if you are habituated to frequently dining out, you have to give up that habit or bring enough money to cater for it. For example, you might have to spend about 10-12$ to have a decent lunch and that’s on a lower side. Even if you eat out for just 10 times a month, you will be spending about $100 for the basic meal. That’s about month’s worth of groceries from Coles supermarket.
If you are planning to move with family and planning to put your kid in daycare, it can cost you a fortune. In all probability, it will cost you even more than your rent. For example, in Melbourne, it typically costs around 100$ – 120$ per day. Though you will get a 50% rebate from the government, it’s not sufficient enough to cover the hole in your pocket. So if you want to avoid those expenses, you should delay bringing family until you get a job or delay putting the child in daycare. Of course, depending on your circumstances, that may not always be possible.
While I was in the US, One of my roommates suffered from food poison from Airlines meal. As soon as he arrived in the US, he had to be hospitalised for the next 15 days. It must have been like a nightmare to him. Thankfully, he was covered by travel insurance or else the poor fellow would have a really hard time. The same thing can happen to anybody. It doesn’t have to be a health-related emergency every time. Your laptop can break down or phone may get lost or your important stuff might get stolen. Bottom line is you never know when the crisis knocks on your door. You need to keep aside certain money to manage such risks.
House Setup Expenses
Many times, people move with their family and rent a house in Australia. Usually, you won’t find many fully furnished houses in Australia, except maybe in CBD areas. In all probability, you may get a house which might have fixed furniture such as wardrobes, shelves, oven and dishwasher in some cases. But apart from that, you may need to buy your own stuff like sofa, bed, dining set etc. If you live in a city like Melbourne, buying a heater is a must unless the house has ducted heating. You may need to buy electric equipment (or “white goods”) such as a refrigerator, washing machine, microwave oven, TV, vacuum cleaner and so on. Make sure your budget covers these expenses.
They’re going to be minor expenses such as phone bill, occasional shopping, a little bit of sightseeing, buying gifts etc. Though small, these need to be considered when preparing your travel budget.
What Is The Best Way To Bring Money To Australia?
There are five main options to bring money to Australia.
- Traveller Cheques
- Travel Card
- Transfer to Australian Bank account
- Exchange with Relative/Friend
Let’s see each option in detail.
The most basic, most insecure and most liquid option is to carry all the money in cash form to Australia. You don’t have to pay any conversion charges, any withdrawal charges or any service charges. But that’s the only convenience it offers. On the other hand, it’s highly insecure and inconvenient to carry in large amounts. Secondly, if you bring AUD 10,000$ or more in cash, you will have to declare it at Customs on arrival.
This is a slightly better option than carrying cash. It is safe in the sense that cheques can be replaced quickly in case they get stolen. However, they are not as convenient as either cash or travel card. You need to cash them out at the bank to get your money. Secondly, they are expensive in the sense that you don’t usually get the best conversion rate and you have to pay certain fees to encash them. Moreover, it can take 3 or more working days to clear the cheque. So if you need money instantly, this is not the right option for you.
Travel Card/Forex Card
This seems to be the best option so far. It provides safety as well as convenience. As soon as it is activated, you can use it at all the shops and ATMs, provided it is MasterCard or Visa card. You don’t have to pay any conversion charges or transaction fees. The only minor issue is you have to pay ATM withdrawal charges, but if you can keep your withdrawals to a minimum, that’s not an issue.
Secondly, in case they get lost or stolen, you can block the card and a new card will be sent to you. Another benefit is that if you are short of money, you can ask your parents or spouse back home to reload the card with a certain amount and it will be available to you in no time. Nowadays, banks even provide the option to reload the card online which makes it convenient and easy to operate.
Australian Bank Account
You can open an account with an Australian bank such as NAB from overseas before coming to Australia. Once opened, you can do a wire transfer to transfer funds to this account using services such as Bookmyforex or TransferWise. Once you arrive in Australia, you can validate your bank account and start using your money using a bank debit card. Also, you can time it to get the best conversion rate. It’s another safe way to transfer a large sum of money without any hassle.
Exchange with Family/Friend
Another popular and convenient option is to exchange amount with your known relative or friend in Australia. This works as follows – suppose you need to carry 5000 AUD. At the same time, your friend in Australia needs 250,000 INR in his Indian bank account. You both can help each other by transferring the required amounts in each other’s account. This way your friend gets INR while you get AUD. It’s a win-win situation for both as you don’t have to pay any conversion charges or service charges. The major limiting factor here is that you should have someone trustworthy in Australia who is also in need of nearly the same amount of INR as you. If you can find someone suitable to do the transaction, this is the best option.
Now that you know all the options, which option looks best to you? I would suggest not to put all your eggs in one basket. You should use a mix of the above options. An ideal combination would be to put 60% of your money in the travel card, 30% in an Australian Bank account and rest in cash. For example, if you are planning to bring $5000, you can bring $3000 in travel card, transfer $1500 in the Australian bank account and keep $500 as cash. That way you have small currency for immediate need but a major chunk is still safely available at your disposal.
What are the tax implications of the money that I bring to Australia?
When you are travelling to Australia for the first time, you are not a resident for tax purpose as per Australian tax laws. Hence, the money that you bring in Australia is not taxable. However, if you bring more than 10,000$ AUD, you will have to report it at customs on arrival as I said above. Also, it is a good idea to carry proof of ownership for the money that you bring to Australia, in case customs officials ask for the source of money.
“Wow, thanks mate! That was really helpful. I believe I have all the answers to my questions now” Raj happily exclaimed.
“Mate! Wow, you started picking up Aussie slang already. Good on ya!” I quipped. “Let me know if you are stuck on something else next time. Cheers mate!”
P.S. In Australian slang, cheers is used as an ending remark such as regards or best wishes as opposed to India where it is used while enjoying drinks with friends.