Planning Financial Budget While Becoming A Digital Nomad (1)

Financial Planning is crucial for everyone. It’s more important for a digital nomad who is on the road most times of the year. If you are a digital nomad who is running a business or working as a consultant for your services, chances are that your income is fluctuating every now and then. This means you don’t have a steady source of income and this is important to note while considering living a digital nomadic lifestyle. Much of your expenses will be to cover your travel and accommodation expenses, whereas there are other aspects to consider as well while living a nomadic life. In this blog, we’ll discuss key factors one needs to consider when planning to become a digital nomad.

1. Budget

Globetrotters around the world will agree to this! Keeping your finances in control might be the hardest thing ever when you have so much to explore in a new place. But it’s essential to take time and handle your money well, or you might have to pack your bags to go home in no time. It’s natural to feel tempted to splurge on new experiences but that might lead to bad financial outcomes. We advise you to consider your accommodation, flight tickets, other transportation costs, food, insurance, essential supplies and plan the budget ahead so you are aware of the expenses you have to bear. Also, always have backup savings if something goes wrong. It’s necessary to use budgeting apps that might help in budgeting better. Also, you can choose to adjust your budget according to expenses every month.

2. Diversify

It’s always better to explore other sources of income that you are capable of earning before you leave. Many people earn passively through stock investments, selling templates online or through affiliate marketing. Think of ways you could make an income passively. Having multiple sources of income can prevent you from getting stuck in a place with no money. Think of means to cut down your expenses if possible. Do you have a condo you could rent out, maybe cut down on things that’s not necessary. Try to find a side gig that might pay you some extra cash. In order to think of diversifying, essentially try to understand what you are good at. Are you good at creating online courses for a particular course? If you are good at social media marketing, offer your services remotely to clients across the world. These are ways you can diversify your income sources.

3. Banking

Fees for transacting money or even withdrawing money in ATMs internationally can add up to a good sum in a few months. Many banks charge hefty fees for bank transactions and this is something every digital nomad should be aware of. Switch to a bank that’s travel friendly. Some of the well known ones are HSBC, Revolut, Charles Schwab, Monzo, N26 etc. The best banking options will depend on your geographical location. This way, you can avoid crappy exchange rates and high conversion fees. Wise was also another option we had discussed in a previous blog post. Remember, your bank account needs to do more than just receive payments or pay simple bills.

There isn’t a single blueprint for creating a financial budget or plan ahead of your trip. It works differently for different people. In the next blog post, we’ll look into more financial hacks to consider as a digital nomad.