UAE residents can save more on rent, school fees using employee benefits

Dubai: Living in the UAE can be expensive. Rent cheques can feel like a full year’s salary, and school fees keep climbing. But the truth is, many residents get help—through housing and schooling allowances—but don’t always know how to make them work for them.

Understanding your benefits can save you money, reduce stress, and even help you plan your next career move. Mercer’s 2025 Middle East Housing and Schooling Report reveals how these costs aren’t just numbers—they’re central to your quality of life and your career decisions.

Housing allowances remain widespread

About 70% of UAE employers provide a separate housing allowance, while 25% include it within a consolidated salary package. The remainder offer total cash packages. This means most residents have at least some support with rent or mortgage payments, which can significantly ease financial pressure.

Rent: Upfront payments ease pressure

Many landlords in Dubai, Abu Dhabi, and other emirates require a full year’s rent upfront. Mercer’s report shows 52% of UAE employers provide housing allowances in advance rather than monthly. If your employer does this, it can prevent you from dipping into savings or taking short-term loans, especially at the start of the year.

Allowance reviews aren’t automatic

Housing allowances in the UAE rose only 4% on average from 2024 to 2025. Most companies review their policy only when needed—59% follow this approach—while only 20% review annually.

If rents in your area spike, your allowance may not keep pace. Check with HR whether your allowance is benchmarked to market trends to avoid unexpected out-of-pocket expenses.

Schooling benefits affect your choices

Nearly 9 in 10 UAE employers provide schooling coverage. Policies often differ by seniority or role—36% of organizations apply the same benefits across all staff, while 64% differentiate.

Only 19% of companies adjusted their schooling policies in 2025, usually due to competitiveness (72%) or rising tuition costs (44%). Understanding your coverage helps you plan strategically for your children’s education and avoid budget surprises.

4 simple steps you can take:

1. Ask if your housing allowance can be paid upfront to manage rent obligations.

2. Check how frequently your housing allowance is reviewed and if it’s linked to market trends.

3. Understand your schooling coverage—what’s included, what isn’t, and whether there are tiered differences.

4. Use this information to plan your finances, school choices, and long-term family budget with confidence.

Why it matters

Housing and schooling benefits aren’t just perks—they influence your day-to-day finances, reduce stress, and even affect career decisions. Andrew El Zein, Mercer’s UAE Career Products Leader, says: "Top talent is at a premium in the UAE.

"Allowances and benefits now influence outcomes at every stage of hiring and retention. When housing and schooling policies are market aligned, clear and communicated well, it provides organizations an advantage in their talent attraction and retention strategies," Zein added.

"This is about building a sharper employee value proposition that enables organizations to acquire the right talent for their growth ambitions at a time when attracting top talent is a business imperative."

Mercer’s findings show that employees who understand and leverage these allowances are better positioned to thrive in the UAE’s competitive job market. For residents, this translates into more financial breathing room, informed planning for children’s education, and better overall work-life balance.