Financial planning for seafarers: Balancing work and savings

Life as a seafarer can be quite adventurous. After all, you spend so much time sailing the blue waters and seeing different lands. Yet, in all this excitement, losing track of your financial planning is easy.

If you struggle to balance managing your finances and enjoying your regular adventures, we have your back! In this article, find out all you need to know about financial planning as a seafarer and how NRI banking services can ease this process.

Why should seafarers focus on financial planning?
 

A life out at sea can be quite demanding and unpredictable. Some of the unique challenges of this lifestyle include irregular income, the hassle of currency exchanges, and limited social security benefits. Proper financial planning ensures that you always have a steady cash flow while building the resources to effectively meet your short- and long-term goals.

With a few smart financial planning strategies, you can boost your savings easily and improve your financial security.

4 Financial planning tips for seafarers
 

If you are struggling with managing your finances, here are four important tips to simplify financial planning for you –

1. Create a monthly budget

The first step towards responsible financial planning is creating a budget. Start by noting your income fluctuations in the past year to determine your monthly minimum and maximum income. This will help you calculate an average monthly income you can rely on regardless of variations.

Based on your average income, note your monthly expenses and divide them by your average earnings using the 50-30-20 rule. This would mean allocating 50% of your earnings to essential expenses or needs (such as housing, transportation, etc.), 30% to recreational expenses or wants, and 20% to savings and investments.

This financial planning approach allows you to manage your expenses while safeguarding your financial security. It also ensures you have adequate funds to support yourself during low-income months and increase your savings during high-income periods.

2. Create an emergency fund

An emergency fund is crucial for seafarers to ensure financial security despite unpredictable income. Aim to save at least three months’ worth of living expenses to cover unforeseen circumstances, including medical emergencies, job disruptions, etc.

It is recommended that you maintain this emergency fund in a high-yield savings account so that it is readily available to cover any emergencies. This will give you peace of mind regarding your financial security, enabling you to focus better on your work.

3. Invest regularly for retirement

You may think of retirement as a distant possibility today, but time is bound to sneak up on you soon! This is why setting money aside for retirement is so important.

One way to do this is to join a retirement savings plan, often offered by several maritime employers. This plan allows you to regularly contribute a portion of your income to a fund specifically for retirement, making it easier for you to save and excel at financial planning. You can also consider investing in instruments such as fixed deposits (FDs), a Public Provident Fund (PPF), the National Pension Scheme (NPS), and more. Maintaining a diverse portfolio that continues to grow ensures you can maintain your lifestyle even after leaving the sea.

4. Choose trusted NRI banking services

Selecting reliable NRI banking services is vital for managing your finances while working abroad. Research and choose banks that offer favourable terms, such as low fees, competitive interest rates, easy remittance services, and user-friendly online support. For instance, IDFC FIRST Bank offers a high-yield savings account called the NRI Seafarer Account to help you with financial planning.

It’s also important to maintain a non-resident external (NRE) account to manage any income earned abroad smartly. This also ensures savings on taxes while allowing you to hold and earn interest on your foreign income in Indian Rupees (INR). Leading banks, such as IDFC FIRST Bank, offer easy online access to these accounts so that you can access your funds and manage international banking even when stationed on ships for extended periods.

How can NRI banking services from IDFC FIRST Bank help you?
 

IDFC FIRST Bank offers various NRI banking services, including a specially designed NRI Seafarer Account, to help maritime employees. The account offers 100% liquidity, allowing you to access your funds anytime and anywhere. You can also choose between an NRE or non-resident ordinary (NRO) account or even both.

The account is rupee-denominated, and your overseas funds will be converted into Indian Rupees at the best exchange rates. Being a high-yield savings account, you also enjoy competitive interest rates to help you save and plan better.

The NRI Seafarer Account is available for all seafarers, including people working on –

1. International vessels
2. Merchant Navy
3. Cruise liners
4. Oil rigs

To open your NRI Seafarer Account, you need the following documentation –

1. Identity proof, i.e., your passport
2. Non-resident status proof, such as a Continuous Discharge Certificate with a valid contract letter for seafarers or an oil rig-specific contract letter with a Visa
3. Indian address proof, such as your passport, driving license, Voter ID card/Electoral card, or Aadhar card
4. Tax-related documents, such as your PAN card/Form 60 or Foreign Account Tax Compliance Act (FATCA)-related fields on the application form
5. Other documents like a recent colour photograph and an image of your signature (only if applying online)
6. When not being met by an IDFC FIRST Bank employee, please ensure your passport, Visa and address proof copies are certified by any one of the following entities from your overseas country of residence –

• An overseas bank
• An overseas branch of an Indian Bank
• The Notary
• The post office
• A Court Magistrate or judge
• The Indian Embassy
• Exchange Houses

Why choose the IDFC FIRST Bank NRI Seafarer Account?
 

The NRI Seafarer Account from IDFC FIRST Bank provides a host of benefits to help you in your financial planning journey –

1. Rupee-denominated account

The NRI Seafarer Account is rupee-denominated. This means that when you deposit funds into the account, all foreign currency earnings will be converted into and reflected in Indian Rupees. 

A significant advantage is that the conversion happens at favourable exchange rates, allowing you to get more INR for the money you transfer from abroad.

2. High interest rate and easy transfers

With the NRI Seafarer Account, you can enjoy competitive interest rates, grow your savings, and achieve your long-term financial goals faster.

Since your funds are available in Indian Rupees, the account also makes withdrawing money for household expenses simple. Thus, it is ideal for paying bills, covering family expenses, or investing in savings while keeping financial goals on track.

3. Access your funds anytime, anywhere

Much like a regular savings account, when you open an NRI Seafarer Account with IDFC FIRST Bank, you also gain access to the IDFC FIRST Bank Mobile Banking App. This makes managing your finances simple by allowing you to perform banking tasks like transferring money, checking balances, and paying bills directly from your phone, no matter where you are.

Conclusion
 

Achieving stability as a seafarer does not have to be difficult with proper financial planning. By implementing these smart tips and utilising the NRI Seafarer Account from IDFC FIRST Bank, you can effectively manage your finances, safeguard your future, and enjoy your adventures at sea with peace of mind. Start planning today for a secure tomorrow!