The following is a guest post by Molly Barnes, author of the Digital Nomad Life. If you’d like to contribute a guest post to Money Q&A, check out our guest posting guidelines.
Most people look forward to their annual vacation, it’s a great opportunity to enjoy some downtime. While a traditional one or two-week vacation may be refreshing, do you find you’re left wanting more out of your travel experiences? What if you could spend every day traveling? Seriously meaningful traveling — not just a week here or a long weekend there. Did you know you can make this a lifestyle by becoming a digital nomad?
You’re probably wondering how you can do this without being a trust-fund baby or winning the lottery. Believe it or not, many people who aren’t independently wealthy do it — and do it well! You can find success by uncovering hacks that help you mix work and play. Essentially, you work remotely while giving yourself the opportunity to truly immerse yourself in the places you’re working from. Here are 4 strategies to help you afford the digital nomad lifestyle.
The Digital Nomad Life
1. Temporarily shut down your ‘traditional’ life
If you plan to hit the road for an extended period of time, before you can go, you need to take care of business at home so you don’t rack up debt or leave behind loose ends.
- Make your house work for you. It’s costly to leave behind an empty home, so you’ll want to suspend any financial obligations you can, and use your home to generate some extra cash. If you have a house or apartment you can rent (or sublet), sell, or move out of when your lease is up, plan to do this. You can easily put your stuff in storage while you’re away.
- Devise a plan for your mail. Start by setting up whatever you can electronically (i.e. online bill-pay or move to paperless bank statements). Then reroute any physical mail to a family member or trusted friend, or even a virtual mailbox. Be sure to choose someone you can rely upon to sort the mail you might receive, determine what is critical to be forwarded, or make the call on what can be shredded or tossed out.
- Set up a tax plan. Just because you’re on the road doesn’t mean you can ignore your obligations to Uncle Sam. (He certainly won’t!) Online tools can help you nail down your tax obligations and help you figure out deductions. And remember: When you work from the road, some of your biggest expenses might be deductible. This can potentially save you some serious cash.
Once you’ve finalized things on the home front, you can start planning your exciting future.
2. Set a budget
Living on the road means you’ll have to know how to budget and stay within those confines. While you’ll ditch traditional living expenses such as rent and utilities, you’ll acquire new ones, including transportation, food, gear, accommodations and, most likely, a larger mobile data plan.
- Be extra prepared. Add up your expenses for all the basics, then budget 25% more. Chances are you’ll need it: Travel for long enough, and you’ll likely run into trouble. Having enough money to respond is the way to keep your travel plans intact.
- Plan to bring money in. The money’s got to keep coming in while you’re on the road. Determine how much you’ll need to earn to finance your travel plans and how you’ll make that cash.
- Prepare for the unexpected. Establish an emergency fund to be prepared for unexpected big expenses. You don’t want the rest of your travels wiped out by one missed connection or accident — or even an exciting opportunity you can’t pass up.
Be sure to prioritize what you need, then factor in your wants. This will help you allocate how much money you’ll need to save before and make during your journey.
3. Set a course
One of the best things of living the digital nomadic lifestyle is the ability to literally set your own course in life. You definitely don’t want to wing it because it’ll almost certainly end up costing you — but if you have a plan, you can avoid going broke. The key is to do it strategically.
- Put an itinerary on paper. List all the places you want to see or things you want to experience.
- Get your timing right. Research which locations have an off-season so you plan to visit these during low tourist times to get more bang for your buck.
- Plan for transportation. Determine how you’ll get from place to place. Car, airplane, train, or bus? Maybe you want to invest in or rent an RV. Or you can use a combination of transportation modes.
- Keep your budget in mind. Look at cheaper accommodation options such as vacation rentals, hostels, and couch surfing. Also, keep in mind: The longer you stay in one city, the cheaper it can be, as you cut down on transportation and learn to find local bargains. Consider short or long-term rentals in affordable cities, such as Charlotte, for example, that offer a plethora of things to see and do for not too much coin.
Bottom line: Pre-planning your travel helps you find the best deals and determine the smartest itinerary and financial options.
4. Line up income streams
Unless you have a full-time job working for a boss who embraces your roaming lifestyle and is willing to send you packing with the promise of remote work (most of us aren’t that lucky!), you’ll have to figure out how to make an income. A good solution is to set up several income streams to ensure all your bases are covered in case any single revenue source runs dry.
- Determine ways to earn. Potential options for earning on the road include: Selling products, charging for services, doing freelance work, or taking on temporary jobs in different cities. Your options are numerous. Be sure to secure any visas, permits, or licenses you’ll need in the locations you’re working.
- Map out the Wi-Fi access points. Coffee shops, libraries, co-work spaces, or purchase an unlimited data plan and use your mobile as a hot spot.
- Plan to travel light. Ease of movement is an essential component of the digital nomad lifestyle. Forget toting around paper files or storing files on your laptop. You don’t want to inadvertently experience a data breach, lose your data, or risk finding corrupted files; these are all costly — and avoidable — mishaps. Keep your data safe and easily accessible by storing it in the cloud.
Be sure to give the earning aspect of your plan some serious thought. It might be helpful to delay your trip if you need to build up additional savings or network with others to establish earning opportunities before you leave.
Living the digital nomad life is an amazing experience and totally affordable, with the right foresight, budget, and plan. What are you waiting for? Why not start planning today?
