From remote teams to solo freelancers traveling the globe as digital nomads: At a time when you can run whole businesses from the cloud, there are many location independent work models – and more of them are emerging. But digital nomadism comes with its own challenges. Read on and learn how to survive as a digital nomad.
Breakfast at noon, followed by a work gig at two, all while enjoying the sea-breeze, cocktail in hand, typing away in a hammock: sounds to good to be true? Because it is.
Life as a digital nomad comes with its own challenges. Without family and friends, you can get lonely even in paradise. Living from pay-check to pay-check isn’t everybody’s thing. Speaking of which: even digital nomads need to pay taxes; and there are many administrative obstacles to overcome.
Who are the Digital Nomads?
In 2016, the freelancer portal Welance launched the first comprehensive study into digital nomadism. Their findings are somewhat surprising: The average digital nomad is male (64%), in a relationship (55%). Most of them are in their thirties (33%), 29% in their late twenties – and 18% between 37 to 75 years young or old. The nomad lifestyle is not as nomadic as you’d expect: A majority of 44% reported an average stay of one to three months, 32% change countries every two to four weeks, and 9% have visited more than ten different countries over a twelve month period. Profession-wise, however, the surprise is small: the majority of digital nomads are programmers (22%) or online marketers and designers (17%).
The Challenges of Digital Nomadism
That same study found that digital nomads don’t do very well money-wise. As inexpensive as cost of living might be in some countries, living on 1.000 to 2.000 USD a month, as 27% reportedly do, won’t make you rich. 19% fare better than that – they earn between 2.000 to 3.000 USD monthly, and 11% happily report more than 5.000 USD per month. As priceless as the freedom and quality of life might be, you’ll need to crunch some numbers to really enjoy the lifestyle of a modern nomad.
1. Taxes, visas & Co.
Work visas and bank accounts, taxes and insurance – wherever you plan to go, get informed before you leave. Will you have to charge VAT, HST or MwSt? Best to consult with more experienced nomads, and even better use expert advise. It might seem like a very high expense right now, but it will pay off long-term. And once you’re at it, check out our handy Moneypenny tax app – it will do your taxes automagically.
2. Create a budget
How much money do you need in your country (or countries) of choice to live the lifestyle you want? Whether it’s camping on a beach or a trendy loft in Singapur, you need to know what to expect. Food, sleep, fashion and health supplies, all come at a cost. Try to calculate your future income and expenses, so you know how much you can really afford – and don’t forget that you might want to be able to pay for that plane ticket home at some point. The good news: our Moneypenny app will help you with that, enabling you to create the budget within seconds.
3. Track your income
Once you’re there, it’s time to start working. As a digital nomad, you probably are freelancing or contracting – meaning you are your own accountant as well. Sending out offers and invoices, reminding late payers and keeping track of your expenses: how will you do that without an office? No worries – as long as you have an internet connection, Moneypenny will do that for you. Try it now, and run your accounts from the beach.
4. Use a time tracker
This may come as a surprise to you. As much as you might live in the moment and carpe your diem, even a nomadic day has only 24 hours – and some of them you’ll need to spend sleeping. Maybe you’ve decided to work according to your budget, not taking on any more jobs than strictly necessary to survive financially. Or you’re like the majority of freelancers, drowning in work at times, followed by inevitable low tides. Whatever is true for you: keeping track of your time is a must. Not will it help you with the invoicing & co., it will give you a better idea what you really spending your precious time on.
5. Enjoy living the dream
Knowing your numbers will give you the peace of mind you need to fully enjoy your new and unique lifestyle. Never before in the history of humankind was it possible to experience what you are experiencing now: the freedom, the adventure, combined with the ability to work (and send invoices) from wherever you are, whenever you want to.
Together, we are shaping the future of work!