Top 5 Financial Mistakes Expats Make in Czechia

Relocating to the Czech Republic is an exciting move, full of new opportunities and experiences. But along with the cultural shifts and paperwork, expats often find themselves navigating a very different financial system—sometimes without much guidance. In my work with international clients, I see the same financial mistakes repeated again and again. Most are easy to avoid with a little awareness and planning. Here are five of the most common ones, and what you can do instead.

1. Not Understanding Czech Tax Residency

One of the first things to clarify when moving to Czechia is your tax status. Many expats mistakenly assume that they’re only taxed in their home country, but that’s not always the case. According to Czech tax law, you become a Czech tax resident if you spend more than 183 days in a calendar year here, or if you maintain a permanent home in the country—even if you travel frequently.

Tax residency means you may be liable for tax on your worldwide income, not just Czech income. If this applies to you, it’s important to register with the local tax office and understand your obligations. I’ll be covering the rules around Czech tax residency and how to avoid double taxation in more detail in a future post.

2. Overlooking the Czech Pension System

It’s very common for expats to ignore the Czech pension system, especially if they don’t plan to stay “forever.” But even a few years of contributions can make a difference later on. The system is made up of three pillars: the state pension (funded by mandatory contributions), voluntary supplementary savings (through pension funds), and private investment strategies.

If you’re working or running a business in Czechia, you may already be contributing to the first pillar. But understanding how all three pillars work together—and how to make the most of them as an expat—can help you avoid gaps in your future retirement income. I’ll explain the full system in a dedicated post soon.

3. Relying Only on a Foreign Bank Account

At first, it might seem easiest to keep using your bank account from home. But in practice, this often leads to extra fees, poor exchange rates, and delays with rent payments or invoices. Many services in Czechia—like utilities, mobile contracts, and even payroll—work best with a local account.

The good news is that several banks are very expat-friendly. Banks like Raiffeisenbank, ČSOB, Fio banka, and Moneta offer English-language services and online banking, making the transition much smoother. I’ll be reviewing these options in a future post to help you choose the right fit.

4. Not Having the Right Insurance

Insurance is one of those things you don’t think about—until you really need it. Many expats arrive with international coverage or travel insurance that doesn’t fully meet Czech legal requirements or day-to-day needs.

In most cases, you’ll need health insurance (mandatory for non-EU nationals), but you may also want to consider life insurance, home and contents insurance, and liability coverage—especially if you drive or own property. I’ll be sharing more soon about what types of insurance expats in Czechia typically need and how to choose the right policies.

5. Living Without a Long-Term Financial Plan

Understandably, many expats focus on short-term adjustments in their first year—settling in, finding work, learning the language. But over time, not having a plan can mean missing out on key opportunities to save, invest, or prepare for retirement.

Whether you plan to stay in Czechia for a few years or much longer, it’s worth thinking ahead. A simple financial plan can help you set goals, make informed decisions, and feel more secure. This is something I help many clients with, and I’ll be writing more about building a financial strategy as an expat in a future post.

Final Thoughts

Getting your financial life in order doesn’t have to be complicated—but a few early decisions can make a big difference. By avoiding these five common mistakes, you can save time, reduce stress, and put yourself on a stronger financial path in Czechia.

If you’d like help reviewing your situation or building a financial plan that fits your life here, feel free to reach out. And stay tuned—I'll be diving deeper into each of these topics in upcoming posts.