This coming Wednesday marks my 30th year of living in Israel.
It’s rather ironic that I will be celebrating this anniversary while vacationing abroad. I came straight out of university and landed here with nothing other than a suitcase and some books.
While it wasn’t easy at first and it took a bit of time to land a stable job, I am proud to boast that 30 years later I have my own company, an awesome wife and five great kids who routinely make fun of my Hebrew. Despite speaking the local language with a heavy American accent, I have managed to get by and establish roots here.
A few days ago, for the first time in three years due to COVID, we had a plane full of 225 immigrants land in Israel. Kudos to co-founders Rabbi Yehoshua Fass and Tony Gelbart, the rest of the very hardworking Nefesh B’Nefesh (NBN) staff, the Aliyah and Integration Ministry, the Jewish Agency and Keren Kayemeth LeIsrael-Jewish National Fund, who continue to bring record numbers of immigrants.
A special shout out goes to the 40 future lone soldiers enlisting as part of the FIDF-NBN Lone soldier program some of whom will be drafting through Tzofim-Garin Tzabar. Well-known local radio personality Noam Fathi, who was at the airport send-off ceremony at JFK in New York, reported how he couldn’t get over how all these olim were saying goodbye to their families and coming here for ideological reasons. It just blew him away.
The buzz around aliyah that NBN has generated is truly remarkable in scope and inspiration. A cousin of mine who lives in Seattle messaged me saying he watched the webcast of the plane landing. It’s become a “thing” to watch people make aliyah. How crazy is that? When I arrived in the summer of ‘92, there was certainly no buzz. I was one of about three new immigrants!
As an experienced immigrant, I’d like to pass along some financial tips to help the new olim make it financially in their new home. I fully understand that getting kids acclimated to a new school and learning a new language is more time sensitive than what is going on with the stock market. That being said, if I can give a tip based on my 30 years living here and professionally working with immigrants, it’s to take care of your finances.
I can’t tell you how often I have met North American olim who neglected their finances and are now paying the price. Here are a few tips that will make your financial aliyah a bit easier.
Just because you are in a new situation doesn’t mean that you can neglect the fundamentals of personal finance. You still need to pay yourself first. Put 10-15% of income into savings.
Too often I hear complaints that with low Israeli salaries it’s impossible to save. Well, it is very possible if you are dedicated to building wealth for the future. If you stop saving you are doing major damage to your long-term financial security.
I understand that for those olim fresh off the plane the need to get settled and create a budget can take a few months so if you miss a few months of “paying yourself first” it’s not a big deal.
Don’t forget your IRA
To my chagrin, one of the most common issues I see when I meet with prospective clients is that they haven’t looked at their IRAs (Individual Retirement Account) or 401Ks in years. The thought process is usually that since this money is for retirement there is no sense in worrying about the money now.
Immigrants tend to forget about these accounts altogether, only to wake up in a decade or so to realize that the value of their account is the same as it was pre-aliyah.
I recently sat with a couple who moved to Israel about eight years ago. They came with a couple of hundred thousand dollars, which was used to buy an apartment. They told me that their biggest mistake was with their IRAs. He had one worth about $60,000 and his wife had about $40,000. It turns out that they were invested very conservatively, with a lot of cash and eight years later, they still have the same amount of money.
Also, very important, make sure that the firm you have been working within the US will still service your account in Israel. This has become a huge issue as many people have received letters that say that they are no longer welcome to do business due to their foreign (non-US) address.
I know it’s tough but take some time to get your financial aliyah in order as well. It will go a long way to help enable you to become financially secure in the future.
Good luck and welcome to Israel!
The information contained in this article reflects the opinion of the author and not necessarily the opinion of Portfolio Resources Group, Inc. or its affiliates. Aaron Katsman is the author of Retirement GPS: How to Navigate Your Way to A Secure Financial Future with Global Investing. www.gpsinvestor.com; [email protected]