Financial Literacy for IT Professionals: How to Structure Your Income and Expenses

Many expats working in Europe as IT professionals can describe their work as successful – and stressful at the same time. Read this article to improve your financial literacy and learn how to save money the right way.

Indian IT professionals in the EU

Are you an expat working for a European IT company? If not, there likely is one among your friends or family: the number of ICT specialists reached almost 10 million from 2013 to 2023, plummeting by 59%. Indians make up a significant share of those granted employment permits to work in the IT sector. Tech hubs like Berlin, Amsterdam, and Dublin attract skilled professionals from all over the world, becoming the next-gen melting pots and offering new opportunities—and new challenges.

EU-based companies can lure Indian professionals with significantly higher salaries and head-spinning career opportunities, but the financial stress for those moving to Europe also extends. Don’t hesitate to check out some beginner financial literacy tips to manage your budget stress-free!

Understanding new realities

The first step in improving your financial literacy is an adequate assessment of the situation. Evaluate your new income and monthly expenses. Include these points in your financial planning:

Salary

Your salary in Germany or Ireland will likely be higher than in India. Yet, you must bear in mind the difference between gross and net salary. Don’t confuse them, as it may play a joke on you.

Shortly, gross salary is your official income before deductions and taxation, while net salary is what you’ll take home. So, your “income” in a budget plan will be the net salary.

Cost of living

Salaries are high in Europe, and so is the cost of living here. Check the Numbeo.com website for the average prices for food, transportation, rent and more. If you want to know how to improve your financial literacy, find out everything about life in a particular country before you move there.

Exchange rates

As an Indian expat in Europe, you will inevitably come across converting euros (or another European currency) to Indian rupees. Prepare to follow the rate fluctuation in advance: explore business news, check out the rate dynamics on Google daily, and ask fellow Indians for budgeting tips. Even though the difference in exchange rates offered by various platforms and services may seem unnoticeable, choosing the most beneficial exchange rate for rupees is often considered one of the best ways for Indians abroad to save money.

Taxes for Indian expats in Europe

Let’s talk more about taxes, as it’s a significant part of beginner financial literacy. In most European countries, staying there for over 183 days makes you a tax resident. If you receive a salary, the deductions will be:

Income tax;
Social contributions;
Additional deductions depending on the country.

Does it mean you must pay taxes in India and Europe? It depends. India has Double Taxation Avoidance Agreements (DTAAs) with most European countries. To avoid paying double taxation, you have to live abroad for over 183 days, have a valid work contract, and have the Tax Residency Certificate of the EU country in an agreement.

Plus, staying and working abroad for over 183 days grants you an NRI (Non-Resident Indian) status. NRIs don’t pay taxes on foreign income in India and can open NRO/NRE accounts to manage finances from another country on better terms.

NRO stands for Non-Resident (Ordinary) account. It allows operations with both foreign and local Indian credits. However, sending money abroad is limited and taxable.

NRE stands for Non-Resident (External) account and allows only foreign credits. Principal and interest earned are tax-free here.

If you are looking into income diversification (for example, if you want to get profit from investments), you may need to pay additional taxes as well.

Taxation budgeting tips

Use tax calculators.
Define your NRI status and report your income on time.
Mind the foreign tax credits and how they apply to income earned in the EU.
Prepare all the necessary documents in advance, add some time for verification beforehand.
If you receive passive income from investments, learn more about NRO and NRE accounts.
Plan your move from India to minimise tax burden in a transition year.
Optimise your employment contract for tax reduction.

Banking and remittances

One of the key financial literacy tips for beginners is choosing the right bank and service for remittances.

Check mobile banks for fast access and smart tools:

N26;
Revolut;
Bunq.

Having at least one online bank account can be a game-changer for expats. It’s faster to open than a traditional bank account, giving you instant financial security as soon as you arrive.

Check special offers for expats in traditional banks:

Online banks are great for daily expenses and travelling, but traditional accounts are a must to get income and have more financial freedom. Contact institutions you’re interested in and ask about special offers for foreigners; maybe they’ll have something fitting for you.

Don’t rush and compare at least 3-4 banks on the subject of:

Fees;
Account types;
Exchange rates;
Withdrawal limits;

It will help you to improve your financial literacy and have a stress-free life in Europe.

Use online services to send money to India:

The best way for expats from India to save money is to cut monthly expenses on remittances back home. So, to improve your financial literacy, consider using Profee. The service offers:

0% fees and the promo rate on your first transfer

You can try the service out without extra losses. Financial literacy for beginners and pros at its finest.

Unbeatable exchange rates afterwards

When sharing tips on how to improve financial literacy, we already mentioned the role of exchange rates on NRIs’ budgets. Profee takes care of it and has great offers to help you stick to your budget. One of the best ways to save money on the market.

Technological approach IT specialists would love

Flexibility: Send funds to bank accounts, cards and UPI IDs.
Speed: Transfers are completed in minutes.
Convenience: Great in-app design and automatic crediting of funds. There is no stress for either the senders or the receivers.
Large sums: You can send huge amounts of money if you provide the source. With Profee’s customer support, proving the source is easy and fast.

Safety

Profee is a licensed service. It follows strict PCI DSS standards, ensures end-to-end data encryption, and demonstrates compliance with the GDPR. Your funds and data are safe, as Profee provides additional security guarantees for its clients.

Tools to manage your budget

Use budgeting apps to plan your monthly expenses in advance for easy money management.

Keep track of your financial flows:

Every article about financial literacy for beginners has a section about tracking your expenses. And we will say it again—to improve financial literacy, you should know where all your money goes. Try the following apps:

YNAB. Divide expenses into categories and follow your budget plan.
PocketGuard. Connect your cards and track bills.
Honeydue. Manage a budget with your partner.

If you don’t like apps, try Notion or Google Sheets. Create a table with your preferred template, manually insert expenses, and create your budget plan. For example, you can adopt a 50/30/20 Rule:

50% for needs: rent, food, utilities, insurance.
25% for goals: savings, investments.
15% for the family: remittances to India, gifts for partners.
10% for fun and relaxation: eating out, shopping, travel.

Invest:

Once you’re ready to invest, go to these platforms:

DEGIRO;
Trade Republic;
Scalable Capital;
Freedom Finance.

Or start with your bank. For example, Revolut offers investing options to their clients.

Study and grow:

To learn everything about the benefits of financial literacy, see what professionals in the field say and think. Subscribe to financial newsletters, listen to podcasts and read books on how to improve financial literacy. As an IT specialist, you know how valuable it is to learn from those with more experience—it saves time, money, and effort. Start by checking these:

Podcasts: The Ramsey Show, So Money, BiggerPockets Money.
Blogs: MoneyCrashers, AffordAnything, NRI Money Clinic.
YouTube: The Money Guy, Benjamin, Ben Felix.

Educational resources will provide insights into how to save money, so don’t miss them out.

Long-term planning

The core of financial literacy for beginners and pros is planning ahead.

1 year: save an emergency fund for 2-3 months.
3 years: invest for short-term goals like buying a car and passive income.
10 years: decide where you want to live, retire, and buy property. Research the financial situation in this country accordingly.

Be strict with your spending. Think several times before buying something, and evaluate how it will affect your long-term goals. This is the key to improving financial literacy.

Concluding remark

Your monthly expenses planning may change significantly after moving from India to Germany, Ireland, the Netherlands, or another European country. Yet, after you get used to the new normal, get ready to reap the benefits of financial literacy: you will feel confident and will be able to stay focused on your career rather than wonder how to improve your financial literacy. There are enormous benefits of financial literacy. Use your money wisely, and lots of opportunities will open up to you. Start by applying financial literacy for beginner tips from this article and take the first step into the world of financial freedom.