Francesca Rebindaine, Sales and Advisor Support
The world is becoming ever more interconnected, with the number of multinational corporations (MNCs) increasing - as is the percentage of MNC headquarters based outside of the US – and as such, employee mobility is on the up. Moreover, advances in technology are providing the rise of the digital nomad, not to mention more opportunity for individuals to work remotely from a location of their choice. With all this in mind, and the fact that the common dream of retiring to a place in the sun is still very much alive and well, who could deny that there is a more pressing demand for solid wealth management solutions for internationally mobile clients?
The COVID-19 pandemic has also made its mark on this demand as it "has accelerated the Fourth Industrial Revolution, expanding the digitalisation of human interaction, e-commerce, online education and remote work." More than that, it has affected people's expectations for work and financial stability. Research conducted found that of 2,000 people surveyed in Singapore and Hong Kong, 76% of them are now looking to find additional income streams as a top priority. The same survey also spotlighted that 54% claim not to have enough in their retirement pots to sustain their lifestyle when they stop working. For expats, particularly those who first move on assignment in their 20s and 30s, it is all too easy to get caught up in a certain lifestyle and neglect to plan for their future circumstances. With these figures, it is clear to see the need for thoughtful financial planning, particularly in areas with high costs of living where the impact of making one's money work for them is particularly helpful.
The rise in emerging markets is also evolving the expatriate landscape. A recent example of this is Prudential's announcement in March that it plans to transform the business into one purely focussed on "profitable growth in Asia and Africa". As part of this transformation, it will keep its corporate headquarters in the UK but will reduce its London headcount, as some staff will be relocated to Hong Kong. As these markets continue to develop, so will the demand for expats. An article produced by the asset management firm Mercer stated, "By 2030, the United States will need to add 25 million workers and Western Europe will need to add 45 million…This will make the global war for talent even fiercer and putting mobility at the heart of many employers’ strategies." Making it imperative for the financial services to focus on helping such individuals navigate the complexities of global wealth, such as tax liabilities and pension planning, and get the most out of their position.
A little closer to home it is, perhaps, somewhat surprising to learn that 55% of respondents to a survey of EU based financial advisers stated that they have acquired more UK clients post-Brexit. For many of these clients, financial planning for their retirement is critical and since individuals must comply with not only EU laws and regulations but also, those of the specific country they are moving to, this can get complicated.
Nevertheless, as global companies continue to invest in their technology post COVID-19, the ease of becoming a wanderlust employee will only follow suit. Welcome to the ever-growing world of the digital nomad.
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