5 finance tips to know if you just moved to Brazil

No clue what a ‘boleto’ is? Wondering where you should open a bank account? Need help figuring out the best place to live? Don’t worry, we’ve put together a guide to make your new life in Brazil free of financial stress. (Good luck with the other stress!)

1. How do I pay for things?

The official currency in Brazil is the Brazilian real (BRL). People still use cash, but there’s no need to carry it around in most cities. You can use a debit or credit card for just about anything.

Domestic credit cards, issued by local banks, in most cases can only be used for domestic purchases. Note that paying in installments is very common in Brazil, even for small value items. Start getting used to the idea that it’s normal to pay for your toothbrush and shampoo in installments. If - and only if - you pay the bill month-by-month, domestic credit cards are interest-free.

Boleto Bancário (more commonly just ‘Boleto’) is a payment method for businesses and consumers that’s similar to an invoice. You can pay off a boleto in cash at any bank, ATM or via online banking. It’s a secure method since there is no chargeback risk, but the delayed payment confirmation can be a drawback since it sometimes takes up to 4 days.

Debit Cards and Online Banking Transfer methods are growing in Brazil. They’re appealing because of their instant payment confirmation and lack of chargeback risks. Debit cards are still a novelty for e-commerce and are only recently available for online payments.

2. Choose the right financial institution

When moving, one of the first things you must do is choose the best financial institution to hold your money. Here are some financial companies and services available in Brazil:

Commercial banks: If you want a one-stop shop that'll have lots of branches, commercial banks like Itaú and Banco do Brasil are a good bet. They’ll set you up with checking and savings accounts, credit cards, or loans for that new car or mortgages.

Online-only alternatives: Non-bank options will often be your best bet. They tend to focus on providing one service really well. For example, at Wise, we spend every waking hour obsessing over how to make it cheaper, faster and easier to send money abroad. No wonder we get excited about up-and-coming digital alternatives to traditional banks. By keeping overhead costs low, these online-only banks pass savings on to customers and often offer helpful services for international residents who may be looking for flexible money options. Banco Inter and Nubank are two banks worth checking out, as they offer free accounts and investment services.

Credit unions and local banks: They may have limited locations in comparison to commercial banks, but the accounts and loans that credit unions offer usually come with better interest rates and lower fees.

Investment companies and brokerages: These will let you keep multiple currencies as well as get you set up with an investment portfolio. They also offer checking and savings accounts, some loans, credit cards, let you make investments and give legal advice. Watch out: investment brokerages often come with much higher fees!

3. Taxes in Brazil

Who loves figuring out taxes in a new country? No one! So it may be best for you to consult with a tax professional who is familiar with the tax system in Brazil.

But here are some pointers for getting started from KPMG’s income tax report:

• Taxation is managed by the Receita Federal do Brasil (RFB).
• The Brazilian fiscal year begins on January 1st and ends on December 31st, and tax returns are due in April.
• The tax system is progressive, meaning it has tiers depending on how much you earn. Individuals are taxed up to a maximum of 27.5% of their income.
• Foreigners are taxed according to their visa (work permit) category.

4. Budget for a new cost of living

The cost of living varies widely between different cities and areas of the country.

In a 2017 cost of living survey performed by Mercer, São Paulo was ranked 26th out of 209 cities in the world, making it the most expensive city in Latin America. Rio de Janeiro and Brasília are also on the list, but significantly cheaper. The cost of accomodation, electrical goods and cars in Brazil is higher compared to Europe and the US, but food and clothing are cheaper.

When researching the best cities to live in (if you have a choice!), take into account housing, food, childcare, transportation, taxes, and healthcare costs.

5. Send money internationally for less

Sending money back and forth internationally often comes with high fees. One way to avoid this is by using Wise.

Liz, an American expat living in São Paulo, recommends this: “I've been living in Brazil for 7 years, and once I found out about Wise, I stopped using banks to transfer money from here to my account in the US. Wise is so convenient and much cheaper."

Setting up a transfer is fast, and the money typically gets there in a fraction of the time it takes with a bank. You can also invite your friends and family to send money with us and we’ll give them a free first transfer. And for every 3 of them who make a transfer, we’ll give you a cash reward.

Sign up for your free account or try our calculator to see how much you could save.