New experiences, new situations, new challenges. Making Aliyah is the majorly exciting realization of your dream. Because you are investing so much time, energy and hope into your move, you really want to do everything possible to ensure its success. So here is your key to a financially viable Aliyah.
Budgeting for success
Some people balk at the idea of a budget and come up with all sorts of excuses to avoid making one. Excuses may range from the “I’ve never had one and I’ve been just fine” to the “but there are so many unknowns connected to living in Israel, what’s the point?” There may be elements of truth to those statements, but there is no getting away from the proven fact that if you construct and keep to a budget that reflects your projected reality you will avoid many pitfalls and set yourself up for financially successful Aliyah.
Some people mistakenly view a budget as a financial straitjacket. Rather than a financial straitjacket, you should view your budget as a liberating tool. You are taking control of your finances by building a budget, and freeing yourself and your finances to ensure that your money will be there for you as and when you need it. You’ll be creating a much-needed level of financial awareness which will stand you in good stead throughout your life, help you prioritize your expenditure and track your goals.
Does it sound complicated? It really isn’t. Just begin the process with these three simple steps.
Set your goals
Where do you want to be, literally and financially in the next five, ten and twenty years? Be specific when defining your goals and prioritize them so that you can see which are more important to you. Write them down so that you can track how you are doing vis a vis your plan.
Build a net worth statement
Gather together all your financial information so that you have a very clear picture of your assets (what you own) and liabilities (what you owe). The difference between your assets and your liabilities represents your net worth. Your assets will help cushion your transition to life in Israel. If you don’t have many assets, that doesn’t necessarily mean you can’t come on Aliyah, but it does mean that you will have to be aware of possible lifestyle challenges. Your net worth statement will give you a realistic picture of what you have and what you can afford.
Create a budget
Create an Aliyah budget with all your projected income and expenses. Look at the major expenses and estimate how much you will spend on them each month. There will be many question marks and variables in your plan. Research, either online or via conversations with Olim, will help give you an idea of expenses you aren’t sure of. Estimate where you don’t have hard figures. Remember that the standard of living is very different in Israel to that of other countries in the Western world. The disposable income is lower, and the cost of living is high, but there are elements such as education that are cheaper. You will need to adjust your spending patterns and priorities. But since all of these adjustments will be made within the framework of your budget, you will have a context and direction to help you navigate your move.
With your budget in place, you can now relax. Yes, you will have to refer to it regularly, update and amend as necessary. But you are now in control. And you are ensuring that your Aliyah will be a financially successful move. Behatzlacha!