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I am living in Canada and have accepted a temporary position in Kuala Lumpur for a year or two. The company has asked how much of my salary should be deposited in my Canadian account and how much in the Malaysian account. How do I calculate this? Just the minimum to cover rent and daily expenses in KL? We plan on traveling a lot, should that money be coming out of a Malaysian bank?

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You should first take into account your living expense in other country by using some online living expense estimator.(for example, https://www.numbeo.com/cost-of-living/estimator_main ) Then do some simple math to calculate the amount based on your home country currency. Apart from that, you may want to put the rest of your salary into your Canadian account.

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Is your employer willing to pay you in MYR (Ringgit) at reasonable exchange rates? Meaning are you happy with the exchange mechanism they're going to use when splitting your salary? If not, you may be better off focusing on a reliable, low-cost foreign exchange mechanism of your own where you'd be paid fully in CAD (because that's your long term home plans) by your employer, then do periodic currency exchanges yourself on the amounts you need to pay your bills in KL.

For immediate spending needs, I'd recommend getting yourself a no-foreign-exchange-transaction-fee credit card denominated in CAD. Visa and Mastercard are surprisingly decent in giving you a fair market rate on purchases (not necessarily on cash advances.) Just make sure you're always charged in MYR rather than CAD when in Malaysia -- don't let them pre-convert it for you! You can then payoff the balance using your CAD cash.

FWIW, when I first moved expat, I did the credit card thing mentioned above and also opened up a new local bank account and credit card in the foreign country I was in. For getting foreign cash, I had my home bank transfer money to my new foreign bank which I would then withdraw or write checks on. However, bank foreign exchange is expensive (wide spreads, no one ever admits to charging commission!) so you should only do this initially until you can setup a preferred third-party with lower costs. I did an initial exchange with enough cash to cover 2 months of rent and estimated utility and food costs. By the time I needed more cash, I had setup a non-bank exchange mechanism, which I then used once-per-month in order to keep the fees as low as possible.

  • There are few Canadian credit cards that don't charge a 2.5% fee on foreign currency purchases. The Amazon Visa is the one I ended up using. I never did find a good non-bank exchange mechanism. – Kim Oct 5 '16 at 13:19
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Do you have Canadian expenses that you will need to cover during that period? If so I would split only so much as you need to cover the costs and perhaps minor saving buffer, retaining the majority in KL. That would give you the most flexibility whilst overseas and encourage you to live as a local.

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