Drawn to the freedom to work from anywhere — as long as there’s a good WiFi connection, of course — more and more people are trading in traditional careers to become digital nomads. The growing number of remote work options means it’s possible to travel the world while still earning a paycheck. In fact, for many digital nomads, the lifestyle provides both personal and financial freedom.
However, becoming a digital nomad isn’t right for everyone. As with any major lifestyle change, there’s a lot to consider before diving in. Then, if you decide the digital nomad lifestyle is a good fit, there are practical steps you’ll need to take to make your dreams of location independence a reality.
Is the digital nomad lifestyle right for you?
Because there is some risk associated with becoming a digital nomad, the lifestyle is not a good fit for everyone. While you’ll never completely eliminate risk, there are simple preparations you can make to minimize it.
If you’re considering becoming a digital nomad, you must assess your current financial situation. First, take a look at your debt. Anyone in serious debt will likely find it hard to become a digital nomad. Many digital nomads work as freelancers, and significant debt could overwhelm you when your income is uncertain. Consider your monthly loan or credit card payments. Would you be able to pay them if you were stuck without income for a week? A month? Hobo with a Laptop, a digital nomad blog, suggests having an emergency fund with at least $5,000 USD. When you’re a digital nomad, unexpected expenses — such as a last-minute flight home — have a way of cropping up. Another smart precaution to take is purchasing “nomad insurance.” Serving as both health and travel insurance, Hobo with a Laptop recommends World Nomads low-cost yet comprehensive plan.
Choosing where to live as a digital nomad
In addition to any debt you may have, you’ll also need to assess your living expenses. Fortunately, for many digital nomads, the cost of living is less than when they were based in their home country.
The digital nomad lifestyle allows you to earn a higher value currency online from a country like the United States while living in another country where that currency can go much further. You’ll need to understand how currency exchanges work to know how much money you’ll be able to make/save in certain destinations.
It’s vital to consider the cost of living when deciding on your destination as a digital nomad. Websites like Nomad List can provide ballpark figures on everything from how much it will cost to rent an apartment to the price of eating out at a restaurant. Budget-friendly digital nomad destinations include Eastern Europe, Asia, and Central America.
Once you have a handle on your debt and expenses, it’s time to figure out how you’re going to finance your digital nomad lifestyle.
How do digital nomads make money?
Many digital nomads earn a living from freelance work. As a freelancer, it’s critical not to rely on a single source of income. In order to be a successful digital nomad, you need to diversify. Additionally, always be on the lookout for passive income opportunities.
Regardless of your industry, there are likely opportunities for you to offer services in the gig economy. Writers, graphic designers, programmers, accountants and, even lawyers, are just a few of the professions able to monetize their skills on sites like Upwork and Fiverr. Thanks to the internet, it’s easier than ever to connect with potential clients.
In addition to providing professional services, digital nomads also make money teaching English, assisting businesses with social media marketing and virtual tutoring. Other jobs you can do anywhere in the world include transcriptionist, administrative assistant and customer service rep. Popular sources of passive income include blogging and creating digital products such as online courses and ebooks.
Does “passive income” and “gig economy” have your head spinning? These days, freelancing isn’t the only path to the digital nomad lifestyle.
Are all digital nomads self-employed?
While most digital nomads do work for themselves, self-employment isn’t your only option. A study by the New York Times found that most industries are embracing remote work, and you can become a digital nomad even while working for a stable company. Being able to work from anywhere in the world is one of the top advantages of working remotely for a company, after all.
When looking for remote work or discussing the possibility with your current employer, you should keep in mind that you’ll likely be working from a different time zone than you’re used to, and that will require flexibility from everyone involved, as digital nomads often work outside the typical 9-to-5 hours. Put thought into how you will set your hours as it will be crucial to your success and productivity as a remote worker.
There is also the option to find a position with a company abroad. Some countries suffering from labor shortages, like Japan, offer visas to skilled workers. While you won’t have all the freedom of the digital nomad lifestyle, finding a job in another country is a viable option for those who want to experience a different culture.
Whether you decide to work remotely for a company or give freelancing a shot, the digital nomad lifestyle is achievable via a myriad of pathways. Whichever route you choose, it’s important to carefully evaluate your current financial situation as well as potential income sources. This kind of preparation can help minimize the risk associated with becoming a digital nomad and help you realize your dreams of traveling the world.
About the Author:
Jori Hamilton is a writer from the Pacific Northwest who has a particular interest in social justice, politics, education, healthcare, technology, and more. You can follow her on Twitter @ HamiltonJori.
