Welcome home to the 21st century

The Celtic Tiger is welcoming her cubs back - and they are coming home in their thousands. Most have been working in America, Europe, Australia, some in high paying professional positions, others in more modest employment. Many are selfmade. What they are now sharing is the realisation of the emigrant's dream - a return to Ireland.

The shocks in store will vary depending on how long the emigrant has been away. Someone who left in their 20s and is returning as a middle-aged parent will find it difficult to cope with a culture that in many ways is more American than the America they may have just left.

The "thirty-somethings" who only departed a decade ago will find the countryside more depleted, but the cities more cosmopolitan than they remember. Ciabatta and flavoured olive oils were not, after all, on too many dinner menus back in 1987.

The choices they will have to make on their return are a lot wider than which food fad to follow, however. Ex-pats have serious financial decisions to make, as well as getting used to considerable investment, taxation, and social welfare changes - most of them favourable.

In her book Living and Working in Ireland, the most comprehensive and up-to-date guide for returning ex-pats and non-national immigrants, author Eugenie Houston concentrates on the realities of life here - the strong employment scene, the improved tax situation, the disimproved housing market (for buyers), the state of education, the cost of living, as well as the changes in social and cultural arena.

"Having carved a successful life in another country, where you fitted in very well and adjusted to the local culture," she writes, "the last place you expect to feel a foreigner is home. The realisation of how much life has gone on in your absence can come as a surprise."

The taxation changes, which culminated in the latest Government Budget earlier this month, have all been for the better. Some 10 years ago, the personal taxation rate was about 60 per cent plus levies; today the highest rate has come down to 46 per cent. A single person earning £30,000 will be nearly £2,000 better off today than they were five years ago; a married couple, with one earner and receiving child benefit can expect well over £3,000 in extra take home pay.

Aside from income tax rates coming down and bands widening, child benefits, pensions and social insurance benefits have also improved, albeit modestly, reflecting an economy that had finally bitten the bullet and begun to control its finances. It must be said that this has sometimes been at the expense of social services, like hospital care and education.

Returning ex-pats with young children will be alarmed at the deterioration of the primary school system; those with older children - especially those who have come home from America - won't believe their luck now that third level fees have been abolished.

For emigrants who are returning from major European or American cities, "comparisons throw up some surprises - for example, there is very little difference in the cost of living between Dublin and Paris, except for alcohol and tobacco".

Pound for pound, Dublin is cheaper to live in than London, and nearly on a par with New York. Salaries continue to be generally lower here, but the taxation and cost of living differentials have been narrowed.

So what are the main financial considerations once you do have a job and a PRSI number?

You need housing, insurance, bank services, and savings and investment options. You need to provide for your own or your family's short and long term health needs, the cost of children's education and ultimately for your retirement.

If there is one thing - on the financial front - the returned emigrant needs most, it is objective and independent advice.

Anyone who left 10 or even 20 years ago will be more than surprised at how the banking, insurance and investment scene here has changed, much of it a result of the lifting of exchange controls and the advent of the Single European Market. Financing a car, a house, or retirement, will all have to be arranged differently than the way it was done in your last country of residence.

Bank services have changed radically in the past few years - credit ratings and overdrafts operate very differently here than in the US, for example - some say the Irish system is more relaxed. Another big change is how your old bank, which used to be a simple deposit taker and loan giver, now competes with building societies for mortgages and with insurance companies for life and pension policies.

The ex-pat will need to familiarise themselves quickly with who can offer what, at what price and for how long. A mistake could be an expensive one.

Similarly, savings and investments are treated differently now: the huge array of tax sheltered deposit accounts and investment funds can be a minefield if you don't take proper advice. Do you want to buy a domestic-based equity fund or an international one? Do you even know what a SICAV is, based as it is out of the Luxembourg Financial Services Centre? The halving of Capital Gains Tax (CGT) by the minister this month makes these a much better buy since CGT must eventually be paid on capital growth and dividend income.

And as for pensions - don't expect a new employer to promise you a clear two-thirds of salary pension anymore: for new employees, defined contribution schemes, that return only the value of the fund, have replaced the traditional "defined benefit" ones that dominated the employment scene here 10 or 20 years ago.

Perhaps the biggest change of all is that you shouldn't expect a job for life anymore. Financial decisions must be made that will take into account the increasingly flexible nature of work in Ireland in the next millennium and making your own provisions for your retirement - in addition to any occupational benefits - is both prudent and urgent. Eugenie Houston devotes considerable space in her book to the house price inflation which has resulted in houses in choice urban areas rising in value by over 300 per cent over the past decade and by 20 per cent alone in 1996.

She warns that a typical three bedroom semi-d in Dublin's own silicone valley around Leixlip, Lucan and Celbridge - where many returned emigrants will end up working - will cost over £75,000, compared to about £40,000 five or six years ago. Expats returning from Britain, where spiralling house prices 10 years ago led to a crash in the early 1990s, "may be concerned that the same destructive pattern may take hold in Ireland". The huge growth in new apartments for rent at least poses an alternative to immediate house purchase. The cost of mortgages and other borrowings have gone down sharply, but the type of loan options have increased dramatically, and you will probably spend as much time choosing a mortgage as choosing the house.

The Irish, you will discover, have caught up with the rest of the complicated world. Welcome home to the 21st Century.

Working and Living in Ireland by Eugenie Houston is published by Oak Tree Press, and costs £9.99.