I moved to Grenada, West Indies, fresh out of graduate school in 2011. I had a few hundred dollars to my name and $40,000 in student loan debt. So, I started teaching writing courses at the university on the island. At night, I did freelance writing.
My $4,000 per month income in Grenada covered rent, food, eating out, and an outrageously expensive car rental. That last item required me to give cash to a man called Mr. Green Jeans (true story) in exchange for a receipt scribbled on scrap paper each month. As part of my $4,000 budget, I also made extra student loan payments, sometimes as much as $800 a month. This enabled me to bring the balance down to $29,000 by the time I left the island in 2013.
[inline-image url="2f91fa20-765f-11ed-8951-b39aeeb44ac4-Catherine-Collins-Digital-Nomad.png" alt=""Writer Catherine Collins pictured in Grenada, West Indies]
Source: Catherine Collins, pictured in Grenada, West Indies
Nowadays, working online while living abroad — also known as being a digital nomad — is far more common. As a result, many people reap the financial benefits of earning a full-time income online while living in more affordable countries. This, in turn, can help people reach financial goals faster.
Living abroad meant I could pay off a portion of my student loans. For others, it means being able to travel the world and hit even bigger financial goals, like saving up for a house.
» OUTSMART THE MARKET. Get Clever Real Estate's free weekly newsletter for homeowners, buyers and sellers.
Getting a visa to live abroad is easier than it used to be
Deciding to work and live abroad used to be more complicated. However, with the growing amount of people working remotely, 49 countries now offer digital nomad visas. A digital nomad visa allows someone who works remotely to live in a country for an extended period of time.
Visa rules and regulations vary from country to country. For example, in Hungary, you can get what’s called a White Card. You need an income of 2,000 euros per month, proof of remote work, proof of health insurance, and bank statements from the past six months showing your income. If approved, you can stay in Hungary for one year with the option to renew for another.
In Greece, you can apply for a Digital Nomad Visa, which gives you legal residence for up to a year there. In Greece, you must have an income of at least 3,500 euros per month. If you have a family you’re bringing with you, it’s more. After a year, you can apply for a Digital Nomad Residence Permit, which allows you to stay longer.
These are just two of the 49 countries currently welcoming digital workers.
A digital nomad in Lima, Peru
Alexandra Borzo, founder of Content in Motion, is an American living in Lima, Peru, where she runs her content business online. The move has enabled her to "enjoy the financial perks in a big way," she says. The key is that she earns a U.S. wage but lives in "a city that costs about one-third of what my expenses were when I was living in Minneapolis."
The result of this low cost of living is that she’s been able to save 50% or more of her income every year.
In Lima, "I get a manicure for about $10," she explains. In addition, her rent for a three-bedroom, three-bath apartment is $950 a month, "a far throw from the $1,600 I was paying per month for a one-bedroom in Minneapolis," she says.
The biggest perk is that because she can save so much of her income, "I could buy a dream condo in cash if I wanted!" A nice condo in Lima, she says, starts at about $250,000. As for being able to save enough to buy her first place, "I didn't think I'd be able to say that at 33. I love the lifestyle I've been able to enjoy since relocating, and I definitely appreciate the financial security of my pot-of-gold-savings in a big way."
Digital nomads who don’t settle down
Source: Hannah Dixon
Of course, if you’re unsure where you want to live for an extended period, digital nomads can also utilize visas in numerous countries or travel to many different places. Hannah Dixon and her wife work remotely and have been continuously traveling for over 14 years. Her business, Digital Nomad Kit, teaches others how to do the same.
Because of this lifestyle, Dixon says, "My wife and I are almost at our goal to purchase our own house, and we've managed that by living in places that are much more affordable." In addition, they hacked their living expenses by house-sitting for different people. This enabled them "to save enormous amounts on rent while getting a real feel for areas we are considering buying real estate in," says Dixon.
Steve Tsentserensky, a video producer and writer, is on a digital nomad residence permit in Croatia. As reported to CNBC, he lives on about $1,400 per month. However, he plans to explore living in other countries that offer digital nomad visas, like Georgia and Portugal – if he decides to leave Croatia. Indeed, with the large number of countries extending visas to online workers, it’s possible to explore living in many different places around the world.
Also, if you think a child excludes you from pursuing life abroad, Corritta and Mea from It's a Family Thing prove it's far from a deal breaker.
"We have embraced the digital nomad lifestyle," says Corritta. She travels with her wife and son, works remotely, and says, "The lower cost of living allows us to save nearly 75% of our monthly income while still living a lifestyle we enjoy."
Their goal is to save up to buy a multi-family unit back in the United States that can serve as a home for them when they visit and a rental that produces income for them. Right now, she says, "Our monthly expenses range between $1,200 and $1,800," where that used to be just their mortgage payment in Oceanside, CA.
Living abroad is a transition
While living abroad has many benefits, the digital nomad lifestyle also comes with challenges. For example, it's easy to get caught up in idyllic pictures of people working on laptops in a seaside cafe without really considering what a transition it can be.
Living abroad for 2.5 years gave me a great appreciation not only for other countries but also for my own. I enjoyed embracing a slower pace of life, but that sometimes came with drawbacks since many conveniences we enjoy in the U.S. were unavailable.
You’ll have to adjust to different internet speeds, potentially different currencies, and different types of food. Also, realize that many things you love – like your favorite shampoo brand or Oreos – might not be available (or are exorbitantly expensive.) Be open to different cultures, aware of potential language barriers, and above all, be patient.
The trade-off is worth it for many people, especially those who live in countries with a low cost of living. That enables them to save larger portions of their income and make their dreams of homeownership come true.
If you’re considering the digital nomad life, here are a few things to consider before taking the leap.
Things to consider before moving abroad
Your financial goals
What financial goals do you want to meet while living abroad? For example, are you saving money on rent by living in a more affordable country? Is your goal to have a down payment for a home by the time you leave? Or would you like to become a homeowner and another country? Is your goal to save as a byproduct of having a lower cost of living? Either way, it's important to have a plan. That way, when you move abroad, you’re going with a sense of purpose.
>>NEED A BETTER CREDIT SCORE? Get a free credit evaluation from Credit Saint!
If you work online, you know how important internet speed is. Make sure that the country's infrastructure can support your business. For example, you might need the fastest internet available if you rely on fast upload speeds for video.
Research how safe the country is for ex-pats. The U.S. Department of State keeps a directory of safety information and puts out travel advisories for various destinations around the globe.
Most countries that welcome digital nomads like to see that you already have health insurance when you go. However, it's important to look at the health care available. Are there doctors you can see if necessary? Are there hospitals nearby? What is the reputation of the healthcare system where you'd like to go?
Is there already a large ex-pat community where you're going? Are there other digital entrepreneurs who work out of co-working spaces?
If you take on a lot of calls for work, is the location you're going to convenient in terms of scheduling calls with clients and colleagues who live in North America?
If you’re interested in learning more about the digital nomad lifestyle, here are some resources that might be useful to you.
Digital nomad resources
The Wifi Tribe is a group of over 1,000 digital entrepreneurs. They regularly meet in different locations around the world to travel and work together. Join their community to get updates on upcoming trips.
Hacker Paradise is another company that organizes international travel for digital entrepreneurs. They offer trip planning and unique experiences. (Is anyone up for co-working in a Normandy castle?)
Remote Year is a company that organizes travel for digital nomads. They offer one-week retreats all the way up to fully planned around-the-world travel for a year. They provide accommodations, co-working spaces, and more for organized travel with like-minded people.
Matt Kepnes founded his website, Nomadic Matt, to help others travel for less. The website includes numerous resources, articles, guides, virtual events, book clubs, and more.