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Abu Dhabi, UAEWednesday 14 November 2018

Scrimp or splurge? How UAE residents like to spend their money

How we allocate our hard-earned dirhams is all down to our value system of what is important to us

Abu Dhabi resident Jasim Ahmed enjoys splashing out on cigars and stylish clothes. Victor Besa / The National 
Abu Dhabi resident Jasim Ahmed enjoys splashing out on cigars and stylish clothes. Victor Besa / The National 

Just as the glamorous Hollywood actress likes to collect coupons or the millionaire business owner drives a beat up old car, every one of us likes to splurge in some areas and be frugal in others.

And while our behaviour might not always make sense to those around us, there’s always a reason for it.

“It’s all based on our value system - what’s more important to us,” says Rasheda Khatun Khan, a financial life planner in Dubai. “We will put a higher price on it.”

Ms Khan, for example, will never compromise on good quality food for herself, her husband and her child, but she will “scrimp” on a hotel when it comes time for a vacation.

“As long as it’s clean, is the criteria,” she explains. “I would go with a cheap hotel and be able to do experiences rather than go to a fancy hotel and compromise on experiences.”

Steve Cronin, the founder of DeadSimpleSaving.com, a website to help residents invest their money themselves and, says the most important thing is to be conscious about spending.

“You need to find a balance between maximising your net worth, your monthly savings rate and your happiness,” he says. “Being frugal about something implies some measure of self-control, which is important for building wealth.”

Here six residents living in the UAE reveal what they like to spend and save on, and why.

Jasim Ahmed, 37

Who: A senior territory manager, from India, who works for for La Casa Del Habano Abu Dhabi

Spend: Mr Ahmed loves cigars and works in the industry, so he will splash out for the best. He also loves to travel for his passion, having been to Cuba three times already this year. And as his distinctive style may suggest, he “will spend lavishly on clothes”. Among his purchases? Several hundred euros on a vintage E.Marinella Napoli tie from the 1960s. “Everybody talks about that tie,” he says.

Save: Mr Ahmed recently cancelled his gym membership, figuring he should just use the one in his building. And although housing prices have dropped in Abu Dhabi, he has chosen not to upgrade. “I could have a bigger house or better furniture, but I saved that money so could travel and I could buy clothes.”

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Read more:

A fifth of UAE expatriates doubled their salary when they relocated

85% of UAE residents still not saving enough for their future: National Bonds

Personal finance in the UAE: Residents track finances better but struggle with saving and debt

The expensive bills you can now pay monthly in the UAE

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Sherif Fayed, 26

Who: Egyptian host of Dubai TV’s The Victorious, and a travel and tech enthusiast with more than a million followers on Instagram

Splurge: “Technology. Whatever it is, a laptop, phone, TVs, gadgets that I think I need but I don’t need,” he says. “That’s why I always tell my girlfriend whenever we pass a Virgin Megastore, ‘don’t let me go in there’. Because I’ll start buying stuff we don’t need. A door handle that will open up on its own as you approach it, you know? Those kinds of things.”

Save: Mr Fayed is not a fan of paying high prices for luxury brand names designed to impress. “It’s more about your status and what you’re wearing and what you’re driving and who you are that people care about,” he says. “So people would spend thousands and thousands on a shirt that’s maybe plain white and has a logo on it and you can get exactly the same thing for Dh100 or less.”

Dubai resident Fiona Falconer spends an average of Dh5,000 a month on food for her family. Photo: Courtesy of Fiona Falconer. 
Dubai resident Fiona Falconer spends an average of Dh5,000 a month on food for her family. Photo: Courtesy of Fiona Falconer. 

Fiona Falconer, 45

Who: The Briton works in Dubai in public relations, content creation and copywriting

Splurge: “My husband and I eat vegetarian or vegan meals at least three to four nights a week, but if we are eating meat, and for the kids, I insist on buying free range, organic chicken and eggs, grass-fed beef and good quality fish, which are all super expensive in the UAE,” she says. Her family of four, with two teenage boys, spends an average of Dh5,000 per month on food. “When I eat well, I feel well,” she says. “You can’t put a price on that.”

Save: Ms Falconer has recently upcycled some old pieces of furniture she was ready to throw out.

“I'm very proud of how I've managed to change the look of the room for just a few dirhams instead of going out and buying new,” she says. “My friends will laugh when I say this but I'm also pretty frugal with clothes shopping. It's a fine balance between buying cheap and buying quality but I refuse to buy designer clothes or shoes when I can put a great looking outfit together for a third of the price. Zara and Mango are my go-tos, but I buy a lot of my clothes at small independent boutiques when I'm travelling.”

Angela Beitz, 34,

Who: A publishing director for Fact magazine in Abu Dhabi, from Australia

Splurge: Although Ms Beitz does not want to put a dollar figure on it, she says she spends a lot on makeup, skin and haircare. “I enjoy the ritual of going to the spa to have a facial or getting my nails done. I invest time and money because I feel like it’s harder to look after your skin and hair here in the harsh UAE environment, and I like to try things that will change up my beauty regime.”

Save: “I realised I was paying $9 Australian dollars for my daily takeaway coffee and it didn't even taste that great, plus it was adding up quickly and was quite a waste of money,” she says. “Now I make coffee at home in the morning.”

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Read more:

New to the UAE guide: banking, saving and investing and securing sound financial advice

Cost of living decreases for expats in Dubai and Abu Dhabi - compared to other cities

How to budget for a surprise expense in the UAE

20 tips to get your finances back on track in the UAE

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Davron Hamidov, 27

Who: Co-founder of Dubai cafes Arrows and Sparrows and Friends Avenue, from Uzbekistan

Splurge: “My weakness is fragrance, so I spend a lot of money on perfume and aftershave as I get bored quickly. I like checking out the new scents on the market. I have a habit of not using the same fragrances, so I spend ages picking a new one – I always want it to be completely different from the last. I probably spend about Dh600-800 every two weeks.”

Save: When it comes to electronics, Mr Hamidov shops around online for the best price. “There are so many deals and discounts on the market that I would never just walk into a store and buy stuff off the shelf.”

The co-founders of Arrows and Sparrows and Friends Avenue, Davron Hamidov and Zee Alikhonov (right) both have a penchant for spending on fragrance. Photo: Arrows and Sparrows
The co-founders of Arrows and Sparrows and Friends Avenue, Davron Hamidov and Zee Alikhonov (right) both have a penchant for spending on fragrance. Photo: Arrows and Sparrows

Zee Alikhonov, 28

Who: Co-founder of Dubai cafes Arrows and Sparrows and Friends Avenue, from Uzbekistan

Splurge: “Most of my spend goes on apparel, accessories, shoes and fragrance,” he says, estimating costs at Dh10,000 to Dh14,000 per month for these items. “I think grooming and style are important – if you look good you feel good. It’s a self-esteem booster.”

Save: Once he buys an item, he doesn’t like to let it go. “If something breaks down, however, or if I lose parts – like my beard trimmer for example – I’ll spend some time trying to find the right part to fix/replace, as opposed to going out and buying a brand new one.”