The Expat’s Guide to Saving and Budgeting in The Netherlands

Relocating to the Netherlands is an exciting prospect! While the move itself brings cost, living here can also be expensive. So, it pays (literally!) to properly manage your finances. As an expat in the Netherlands, you’ll want to enjoy all of the best aspects of Dutch life. So, establishing solid savings and budgeting techniques is crucial for living stress-free while planning for the future.

Remember, building up savings and becoming financially stable is a process. Don’t be disheartened – it takes time! To help make things easier, we have put together a simple step-by-step guide. Ready to start saving and budgeting effectively? Let’s celebrate small wins, avoid self-criticism, and stay calm. We’ve got you covered with some saving and budgeting tips.

Identify Where Your Money Goes

The first step to effective budgeting and financial planning is understanding where your money goes. Track your spending meticulously for at least a month. bunq, a European challenger bank based in the Netherlands, provides crystal-clear insights into your spending through a dedicated budgeting tab. You can use this for month-by-month comparisons and to break down your spending into categories. It even allows you to add external accounts for a complete financial overview. For budgeting and saving, bunq has designed a tool that’s so easy to use that people will actually do it! So, throw out that notebook and delete that spreadsheet. Studies show that tracking your spending patterns can help you save significant percentages each year! Visualizing using the 50/30/20 model helps you prioritize and identify where you can save.

This approach stipulates that 50% of your income should be spent on ‘needs’ (bills, necessary costs, etc.), 30% on ‘wants,’ and 20% on savings. Of course, your savings percentage can (and perhaps should) increase. If more than 50% of your income is going towards necessary costs, consider ways to reduce them. The same goes for 30% on activities and other non-essential purchases.

Awareness is the key to making informed decisions.

List Everything You Spend

Creating a comprehensive list of all your expenses can be eye-opening and daunting. With bunq, you don’t have to do it! With the handy categorization abilities of bunq’s budgeting tab, you can sit back and watch the financial insights roll in. Plus, with Finn, the personal AI financial assistant included with bunq’s plans, you can simply ask what your spending looks like rather than trawl through bank statements and payment apps! Any good spending overview should list everything, from rent and groceries to that morning cappuccino and weekend outings. This reveals your spending habits and highlights areas to cut back. Often, the little things add up more than we realize. A €3.50 coffee five times a week, 52 weeks a year, adds up to an extra €910! Don’t fancy scrolling through to find those transactions? Ask Finn to do it for you!

Automate Your Savings Process

Automating your savings can be a game-changer. Set up automatic transfers to your savings account right after you receive your salary. This ensures that saving becomes a priority, not an afterthought. Many banks in the Netherlands offer automated savings options, making it easy to put your savings on autopilot. In addition to automatic transfers, bunq also offers another savings-focused service, AutoSave. This rounds up each purchase, helping you save the pennies, which soon add up!

Get an Accountability Partner

Having someone to share your financial goals with can motivate you to stick to your budget. This could be a friend, family member, or fellow expat. They can offer support, share tips, and keep you on track when you’re tempted to overspend. This works especially well if you share the same goals – for instance, if you’re saving up for retirement together or are planning a vacation or house purchase!

Stay Organized

With multiple bank accounts and possibly cross-border finances, staying organized is crucial. Keep all your financial information in one place. Use apps that consolidate your accounts and give you a clear overview of your income and expenses. Bunq recently introduced Open Banking into their offering. This means you can link all external accounts, making it simple to gain complete oversight of your spending in one place. Knowing exactly where your money comes from and where it goes helps prevent unnecessary fees and missed payments. Mobile banking and automatic budgeting features, such as those offered by bunq, can help you consolidate your finances, making them easy to access, track, and optimize!

Set Goals and Try to Stay on Track

Setting financial goals gives you something to aim for and keeps you motivated. Whether you’re saving for a vacation, a new gadget, or an emergency fund, having clear goals helps you stay focused. Regularly review your progress and adjust your budget as needed to keep on track.

It also pays to separate your savings into specific pots. With bunq, you can open up to 25 sub-accounts. This makes saving for specific goals far easier. Make long-term savings untouchable. bunq supports this with the option to set limited withdrawals on savings accounts. By limiting withdrawals to twice per month, you can slowly change bad spending habits into great saving strategies! Emergency and everyday savings should be accessible but still separate from one another. Create a specific account if you’re saving for something specific, such as a house purchase!

Quick Tips to Spend Less

Cook at Home

Eating out can be expensive. Cooking at home saves money and is often healthier. The variety of cuisines available in the Netherlands is tempting—but consider these treats, not necessities! The same goes for enjoying evenings out and socializing. Make sure you budget properly—those delicious Dutch beers quickly add up!

Public Transport

The Netherlands has an excellent public transport system. Use it instead of owning a car with high parking, fuel, insurance, and maintenance costs. Consider the right public transport subscriptions to take advantage of time-specific cost savings or travel by bike or foot! For example, NS offers various subscription options that will save you money if you travel outside peak hours or as a student.

Discounts and Sales

Take advantage of discounts and sales. Supermarkets often have weekly deals that can significantly reduce your grocery bill. Grab an Albert Heijn bonus card (bonuskaart) to access these savings, and watch for yellow stickers at other chains, such as Coop, Jumbo, or the popular (and cheap!) Action! Supermarkets also often bundle multiple products, such as the common ‘1+1 gratis’ deal. Also, consider shopping at independent supermarkets. Often, local stores sell produce at lower costs, especially fruit and vegetables. You should also take advantage of any weekly food markets in your city or town. With these, it pays to buy fruit and vegetables when they are in season!

Second-Hand Shops

Explore second-hand shops for clothing, furniture, and other items. You’d be surprised at what you can find for a fraction of the price. Growing in popularity is the idea of ‘thrifting.’ Check out online second-hand platforms like Marktplaats or social media to snare a second-hand bargain.

Build an Emergency Fund

An emergency fund is your financial safety net. Aim to save at least three to six months of living expenses. Be sure to separate this from your general savings or monthly payments account! This fund will give you peace of mind and security in case of unexpected events like job loss or medical emergencies. It can also cover things such as your washing machine breaking or a boiler malfunction. For those unexpected costs that suddenly appear throughout the year, having a pot to draw from can help you focus on enjoying life.

It is also key to remember that other aspects of Dutch life bring surprise costs. Your health insurance may not cover everything, especially unforeseen procedures such as wisdom teeth removal or physiotherapy sessions.

Save Your Raises and Windfalls

If you receive a salary increase or come into unexpected money, resist the urge to increase your spending. Doing so is known as lifestyle creep. If you can live a comfortable life on your previous income, there’s no need to abandon that! Instead, direct that extra income into your savings or investment accounts. This practice accelerates your financial goals without compromising your current lifestyle. If you wish to use these additional funds, save the majority at least, and be strict with yourself!

Get Started with Investing

If you still need to start investing, now is the time. Investing helps your money grow over time, beating inflation and building wealth. Consider low-cost index funds, which are an excellent option for beginners. They offer diversification and lower risk compared to individual stocks. While most companies in the Netherlands provide retirement plans, they’re often basic. Investing privately allows you to save for your future and secure a stress-free retirement.

Find a Complete Solution

Perhaps the best way to manage your finances is to find a complete solution that touches on all the above points. It’s even better if that solution removes some complications of maintaining spreadsheets or keeping track of multiple savings accounts. bunq makes budgeting easy. Savings can be automated, spending can be tracked, investments can be made, and long-term goals can be secured. They also have services specifically built for expats.

bunq provides budgeting insights through an integrated AI assistant, which provides detailed information about your spending habits and progress toward your savings goals. Discover their full range of plans and detailed information about how they can support your budgeting aims here!

Read Also: How to Save Money in the Netherlands

Towards Financial Mastery

Saving and budgeting as an expat in the Netherlands might seem daunting initially, but it becomes manageable with the right approach and mindset, along with the best tools that eliminate the hassle of financial admin. Remember, budgeting and planning are important, and it’s a process. Celebrate small victories, don’t beat yourself up over occasional slip-ups, and stay focused on your long-term goals. The key to success is consistency and commitment. bunq’s services can make your financial life far more accessible, so consider reaching out to see if their banking solutions benefit you!

You’ll soon be well on your way to better budgeting, saving regularly, success, and peace of mind!