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Readers' Roundtable (NEW!)

Are You Financially Trapped in China?

A venue for intelligent and well-written discussion of major issues facing foreigners in China.

Re: Are You Financially Trapped in China?

Postby Musicjunkie » Tue Aug 21, 2012 3:12 pm

I personally think that this discussion has gone off on a complete tangent. I fully explain my views on the financial viability of living in China in my own personal story: Proud, Educated, and Working Class: Teaching English in China.

We all know that living in China is very challenging and many facets drive us crazy on a regular basis. These range from cleanliness, pollution, the weather, terrible customer service, a ridiculously inefficient banking system, noise, crowding, lack of standards, lack of public and personal hygiene, the language barrier, numerous employment issues... I could be here all day! However the initial discussion and the reason behind Mr Taylor's personal story is the financial aspect of living in China, of which the above issues are of little relevance.

Am I financially trapped in China? For the moment I believe I am, but for the reasons most would initially think. I am still here (two years and nine months, not that I'm counting) because I am simply worried that if I go back to the UK I would not be able to enjoy the same level of discretionary income and free time that I currently enjoy. Let's do the maths.

At present I earn around 18,000 to 20,000 yuan a month with zero benefits. That is 100% take-home (net) pay. To take home the same amount in the UK I would have to earn a gross salary of around 33,000GBP (around US $50,000 or about 25 percent more than the average salary in the UK) as I would have to account for my tax, national insurance and student loan repayments, none of which I have to pay whilst I am in China. On top of this, I don't have to pay any council tax (which any UK citizen can tell you is a crippler), nor do I have to pay anywhere near the same level in train fares (I never owned a car in England, but we have the most expensive fuel and public transport costs in Western Europe).

My utility bills (currently at their highest-ever levels) and my rent are a significantly smaller proportion of my income even though my apartment is of the same standard. Basically I have miles more money in my pocket in China than I ever had in the UK. Financially the whole thing has worked out quite well, even though I find living in China to be very stressful.

The job market in the UK at present seriously sucks. We have record graduate unemployment, record youth unemployment, and a government that thinks that the best way to solve these issues is to give a five percent tax break to it's richest citizens. We are back in double dip recession with no growth on the horizon.

Employers have taken full advantage of this by demanding ever increasing working hours, providing salaries that are growing at less than the rate of inflation and less desirable pensions. Also, currently, I am traveling in Nepal and India for six weeks. The maximum holiday I was ever given in the UK was five weeks a year with a maximum block of two weeks at any one time. Indulging my insatiable traveling bug would be impossible in the UK.

Back to the situation in China, I certainly do not believe China is the promised land. There are a lot of times when I have wanted to pack my suitcase and leave. But many foreigners in China are not helping themselves. If you have been here for more than 18 months, made some contacts, and some networks, then you should be earning some decent money as the best positions are never advertised. If you are earning 5,000RMB per month then you simply are not working hard enough or smart enough. The money is in moonlighting and working privately. As I wrote in my personal story, "To save money you must get a good paying job, ideally take on some very well-paid private work on the side, and then keep your expenditure to a reasonable level."

As far as I can see the only way to make and save a reasonable amount of money is in a first-tier city. The reason for this is that although the cost of living is higher, the pay is higher also. That means if you want to travel, or buy western goods and electronic items, etc. it will cost you less as a percentage of your income to buy it. If you want to buy a new mobile phone that is 5,000RMB and you earn 5,000RMb per month, that is one month's salary gone: if you earn 15,000RMB, then it is one-third of your monthly salary.

The other factor that seriously affects the foreign male teachers ability to save money is that many make poor choices in the relationships they pursue. I know this isn't going to be a popular idea, but I know many a foreigner who gives a large part of his monthly salary to his wife/girlfriend, and then regularly sends money to her family and then even pays a dowry when it comes to getting married. No wonder he is broke!

Let's be really honest here, most foreign men are with Chinese women who are a drain on their finances. To succeed in China, it is important to be in a relationship with a woman who is an asset and not a drain. Many Chinese women have completely unrealistic ideas about how rich Western men are and have very conveniently (for them) traditional ideas about how a male should be a breadwinner. Many foreign men I know are simply too weak to resist their partner's demands. I think it is hilarious that so many foreign men complain about Chinese women being "gold-diggers" when they failed to see the warning signs of such a woman a mile away.

"Liberty is the right to tell people what they don't want to hear" - George Orwell
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Re: Are You Financially Trapped in China?

Postby Johnty » Tue Aug 21, 2012 8:25 pm

Musicjunkie you have presented a fine, detailed argument, but essentially an argument which shows that things are going well for you presently, and that you certainly have made a determined effort to make the very best of your situation, even though there are drawbacks to living and working in China, of that there is no doubt. Though, I can’t help feeling it’s as if you have to constantly dodge between the raindrops to succeed, as a young man might.

I am curious though if a person such as yourself remains in China and retires what happens then in terms of staying in China with a visa to enjoy your old age? I write this only because it was part of my wife’s and my plan to obtain a green card. At my college they have implemented the new, ‘nationwide’ Social Security system available to overseas teachers, but one of the questions asked was about how one retires in China when one reaches retirement age in terms of getting a visa. Without the green card I had a morbid fear of reaching retirement age or beyond and then having to return home because I did not have a full time job. We all know how China can be unforgiving. Even with the green card, however, I received an answer that wasn’t so favourable, though things may change between now and when I retire.

You may be right about Western men marrying Chinese women and trying to remain in China, because I am sadly starting to hear more often these days in my own city of foreigners divorcing from their Chinese wives. One wonders though on the financial and emotional effect this must have on both parties involved. Does this make it easier or harder to return home or stay in China?
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Re: Are You Financially Trapped in China?

Postby Dr. Greg » Wed Aug 22, 2012 1:42 pm

I would like to thank everyone for their contributions to this highly informative discussion thus far. The question of financial freedom in China (or anywhere else for that matter) is, obviously, a very complicated and multifaceted one.

In my closing post on the thread “Returning Home Dirt Poor,” I tried to address the question of China EFL employment from a two-pronged perspective: 1) current income feasibility and, much more important; 2) long-term career positioning and future income-earning capacity. I believe that this second point is at the heart of this matter.

The 20s and 30s, the two decades referred to as "young adulthood," are one’s career development and positioning years. Hypothetically speaking, if someone spends 15 years teaching oral English in China, say from age 25 to 40, what, then, is he prepared to do other than teach English in southeast Asia? The question of entrapment in this case is not just financial, per se, but vocational/logistical.

Compare this scenario to one in which, for example, a young certified teacher with a master’s degree in chemistry teaches at Canadian-curriculum international schools in China and the Middle East and then returns to British Columbia at age 40 with a bundle of savings. Now his situation is entirely different than that of the lay EFL teacher. Our certified Canadian teacher can now apply for any appropriate position he cares to in Canada with the benefit of 15 years of relevant and fully applicable professional experience. In addition to that, he has a big bundle of money to fall back on, money he managed to save by earning highly competitive salaries in areas of the world that were considerably less expensive to live in than Canada.

The first question, above, of current income feasibility as a China EFL teacher is much more difficult to discuss because the factors influencing and impinging upon one’s perceptions of financial health (or lack thereof) and, particularly, feeling trapped in China are, clearly, far more subjective (psychological) than objective (financial). In this context, quality of life issues (one’s feelings about the physical environment, public hygiene, social mores and norms, language barrier, etc.) are especially relevant to this discussion.

Why are corporate executives from companies like Nike and BMW awarded significant bonuses when they are transferred to mainland China? Because despite the fact that their six-figure incomes will go a lot further in China than back in, say, Pensacola, Florida or Hamburg, Germany, the companies fear they will lose their senior managers to the harshness of day to day life in China without that added financial incentive to stay. This is not a concern they would have if these employees had been transferred instead to San Diego, California or Chapel Hill, North Carolina.

Whether we are talking about Western people in China or Western people back in their own respective countries, the clearest road to financial freedom is (successful) business ownership, especially businesses than can be managed by individuals other than the owner. The problem with a private practice in psychotherapy or freelance teaching in China (completely aside from the fact that, in both examples, one has no choice but to work illegally and, thus, “dodge between the raindrops”) is that, although far more lucrative than a salaried teaching position, one has to earn the income "with his own hands" and remain in China to do it. Get sick, go on vacation, or move to another location and the income stops. This is a very different scenario than owning a bar or school (or a franchise of such) in which other people can run these businesses for the owner.

I agree with Dr. Lucy and John Taylor that there is ever growing anti-foreign sentiment in China. Right now it seems to be mostly limited to Americans but, obviously, as was the case with the Boxer Rebellion, all Western people will eventually be targeted, especially when China's economy takes a turn for the worst (and it has already begun, watch out). In the last month alone, I have received two independent reports from American teachers of harassment and I have another unconfirmed report of two foreign teachers having been beaten by their students at Sun Yat-sen University in Guangzhou last year. When I was practicing in Guangzhou, I worked with a young American man (EFL teacher) who was routinely bullied and harassed by the local Chinese (other young men), although he seemed to be targeted more when he was in public with his Chinese wife.

Nevertheless, as more and more factories close (that is, as more American companies win back bids they had previously lost to China), as more and more Chinese become unemployed and disenchanted, the "rich" foreigners in their neighborhoods, particularly the ones married to "their women," will become convenient targets of their displaced frustration and anger.

While I had never personally been the victim of intimidation or bullying, during the entire seven year period that I lived and worked in China, I could never quite get over the audacity, oppressiveness, and sheer stupidity of both the degree and scope of Han chauvinism that surrounded me. In this context, I do agree with Refugee and Dr. Lucy that the Chinese do not truly want to learn from us. We are in China to be exploited, pure and simple.

At the end of the day, financial success in China is a race of who can exploit whom first.
Dr. Greg
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Re: Are You Financially Trapped in China?

Postby atlantean » Mon Apr 29, 2013 9:47 pm

Dr. Greg has stated the case very eloquently as usual. I have been in China for four years, and this will be my last job in China, God willing. I am saving my money for repatriation in America. I vow to myself that if I should somehow lose all my money, I will save the money for a one-way ticket to America and live in a homeless shelter temporarily. I am determined to get out.

I enjoyed China so much for two to three years, and then reality set in. It's just a lousy compensation package. No health insurance, no retirement, and second class status in the Chinese caste system.

Even with health insurance, the medical care here is poor. My love affair with China has become an abusive relationship and I am getting a divorce!

I believe I can get another job in America, but if not I am going somewhere else, not back to China. I was never a real teacher and wanted to travel a bit before I die, so TEFL was my only avenue. But I did have a halfway decent job in America, and my wanderlust and wanting to run after a bad divorce may have come at a high price.
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