If the same question were posed with reference to Jakarta it would not be too difficult to find plenty of reasons; no doubt the one that immediately comes to mind is the gridlocked and chaotic traffic and associated pollution. While the people are friendly and welcoming, there are other reasons such as growing nationalism (not just here of course) and the threats that undermine the great diversity upon which Indonesia was founded. But as for Jakarta itself, even the government is planning to leave! Relocation of the capital to a new site outside Java is now very much on the cards. Fortunately Bali is not on the short list!

The western expat population is a tiny fraction of what it was in the oil and mining boom of the eighties when I first arrived in Jakarta. Nevertheless, some of us remain for work or family reasons or just because it is still our ‘comfort zone’ with a social life that would be lost if we left after such a long time.

But Bali is very different from Jakarta

While Bali has also changed it still has a lifestyle to be envied by many in the West. That’s why thousands of foreigners and westerners in particular have made it their home, in many cases after a first or subsequent holiday trip. Some have settled and just want a quiet and peaceful life, free from the stresses of the rat race; some have professional jobs, some run successful businesses while others join charity organisations such as the Rotary clubs and make major contributions to the well-being of the community.

So why would any of them leave?

I would say those who do leave fall into one of two main groups:
1. Those who decide they want to leave and
2. Those who have little or no choice but to leave

I would go further to say that those who are in the first group are then subdivided into two. We have those who:
a) Have positive reasons for leaving and
b) Have negative reasons for leaving.

Group 1a) would consist of professionals, such as senior hotel staff or international teachers who move on as part of their career path or those who always planned to return to their home countries and / or families on retirement after a satisfying and productive working life in Bali.

Group 1b) would be those who have grown disillusioned about life in Bali or have found that they no longer need the excitement that lured them to the island when life revolved around surf, sand, late night bars and discos. Or those who cannot live with some of the unwelcome changes such as mass tourism, uncontrolled development and worsening traffic congestion.

Those in the second group also fall into two main categories:
a) Those who are literally forced to leave and
b) Those whose circumstances leave them little option but to leave.
Group 2a) would include those who have broken the law, which typically means overstaying visas, working illegally while holding social or business visas or falling foul of the authorities in one way or another.

Group 2b) would include those who need to return home for serious medical reasons and / or can no longer afford international medical insurance. Note that the insurance companies will woo you for your business early on but will not welcome you once you reach a certain age. Their way of telling you may wish to take your business elsewhere is to apply a large increase to your annual premium. I said goodbye to them when they bumped up my premium by 37% even though I had never made a single claim! Of course when you consider that heart surgery or a course of cancer treatment can cost them upwards of $100,000 their position is easy to understand. The insurers are operating a business, not a charity.

Then we have a large number of pensioners who find it increasingly difficult to live on a rapidly diminishing income. British retirees in Bali for example had their state pensions frozen from the day they left the UK. A local group in Bali continues to support the fight to redress this anomaly. Some actually cannot leave because they are too frail or have local families that could not join them. While those who can return to their home countries usually have a state safety net that will meet their minimum needs, those who cannot leave have to accept the reality and count their few blessings such as the ability to eat cheaply and not having to pay heating bills in the winter!
But all those who leave have something in common

Whatever the reason for leaving Bali or any other foreign location everyone has to take stock of their financial position and make fresh plans for their new life ahead. The planning should start well before the actual move takes place, preferably years before.

The easiest relocations are probably back to one’s old home town or area since some things will still be familiar and you can probably link up with family and old friends. Choosing a totally new location because it looks good in the brochures or on TV or the Internet can be a disaster.

If you have planned wisely and built up a nest-egg over the years then you need to address the tax implications of your move. Don’t look for the tax dodges of the past by disseminating your savings around tax havens. Today, information is freely exchanged by tax authorities around the world. All banks and financial institutions are obliged to furnish account information to their respective tax authorities.

Again, if you have built up some savings there could be ways to legally reduce future tax liabilities. Brits for example can still place money in an offshore bond and then draw down 5% free of tax for 20 years. A helpful facility if there is other taxable income.

There have been a number of cases in recent years where expats have sold properties in Bali worth quite considerable sums as they bought or built them cheaply decades ago. They needed quite a bit of guidance on how to handle the ‘windfall’. The first bit of advice is not to rush into anything. Get as many facts and as much information as possible about the many options and the pros and cons of each.

On moving back to one’s home country there are probably two outstanding needs:
1. Purchase of a new property and
2. The setting up of a retirement plan that will ideally produce a liveable income for the remainder of your days.

In both cases there are many options and combinations to consider. If these can be addressed well in advance of a move so much the better. Otherwise the best advice is to commit to nothing until you have had ample time to ensure the decisions are wise ones.

And now, the ‘twist in the tale’

Another good reason not to rush into any quick decisions is that you may find that the outside world is not how you imagined it or that it has changed so much that you wish you had never left Bali. And so, as I have seen in several cases, the reasons to come back are stronger than were the reasons for leaving!

You can read all past articles of
Money Matters at www.BaliAdvertiser.biz
Copyright © 2019 Colin Bloodworth

Colin Bloodworth, Chartered Member of the Chartered Institute for Securities and Investment (UK), has spent over 20 years in Indonesia. He is based in Jakarta but visits Bali regularly. If you have any questions on this article or related topics you can contact at : colin.bloodworth@ppi-advisory.com or +62 21 2598 5087.