Digital nomads are a fast growing tribe of freelancers, independent contractors, and employees that enjoy the freedom of pursuing a carrer without being tied down to a desk. Does this sound attractive to you? Learn how to manage your money and you can live on the road fill-time as a digital nomad.
Budgeting as a digital nomad
Everyone benefits from a budget but establishing one is more critical for digital nomads. Traveling will eat most of your money and it can be challenging, especially if your income is irregular.
Assess your income and you will find patterns. If you are freelancing or an entrepreneur, look at what you have earned for the last year and use the lowest month’s earning as the baseline for your budget. Plan your expenses with this income so you do not run the risk of overspending. In months when you earn more, you can just use this money to add to your savings.
Check your expenses next. How much do you spend on rent, food, traveling, insurance, and other work essentials? If you have loans or other debt, add these to your tally as well.
Make a point of prioritizing savings, too. This saves you a lot of stress since your income fluctuates monthly. Setting up an emergency fund is also smart so you are ready for unexpected expenses in case you get sick or lose something on the road.
Ideally, your budget will cover all your essentials and discretionary spending and still make savings possible.
Do not forget responsibilities at home
Some digital nomads only travel part-time. If you own a home or are renting, it is a must to add these expenses to your budget. Even if you are away, your bills at home are running and you do not want them to pile up. Also, even if you are spending your time away from the country, your income that is earned abroad remains taxable.
There are some exceptions so learn the rules to avoid getting into trouble. Leading a digital nomad lifestyle is fun but you have to remain responsible to afford your freedom.