Finances

This page has a few sections:

Jobs and income

If your existing job is totally unsuited for remote work, then you have a long road ahead of you. Nowadays, people are always finding new ways to support themselves while traveling. You might be one of the amazing people who can find interesting ways to earn money that others have not yet found. But for the most part, DNs are workers in a tech-related field or entrepreneurs.

It is easier to find work in technical fields such as web development, software development, design, video production or SEO. Less common but still totally viable, are various forms of writing, translation and virtual assistant work, and teaching english online. Many people don’t work for anyone and run their ecommerce stores, often in a dropshipping style or have a successful blog.

Non-tech jobs can be: business or personal coach, marketing, research, consultants of various types. 

Changing to a DN - compatible job

Most of us will need to learn how to do one of these jobs

Web roles layed out

The green jobs shown above are management / business (difficult to do remotely unless the entire organization is). Blue is writing. Orange is creative. On the right is technical. Each block overlaps with it’s neighbors. People with experience are usually able to do more than one of the neighbors of their primary speciality. You probably already know roughly where you will do best, but try a bunch of different things by doing online courses (UdemyKhan academyCoursera) over a few weeks and then focus on whatever is the most fun - that's what you're going to effortlessly get awesome at.

That focus might take the form of formal training or coding bootcamps but the important thing is you get some experience and build up a portfolio of work. You should even consider doing projects you invented with no customer. It's very common in this situation to not make much money in the beginning of your DN journey, but don't get discouraged. You'll probably need to have a normal job before trying to make it nomadic, but take time to increase your experience and expand your portfolio.

Become an internet entrepreneur

Dropshipping and affiliate marketing are popular amongst nomads. There are plenty of courses offering to show you their secrets “for a small fee”. To do well in these paths you need basic website building knowledge, enough money to survive for up to two years until you get a profit, and some luck. Many don’t make it.

Watch out for people who promise things that are too good to be true. There are a lot of people who claim to be teaching others how to make money on the internet, but the only way they truly make money is by teaching others how to make money. Some people are getting pretty cynical about it.

Finding jobs

Many startups have a positive attitude towards remote work, so lurking in startup Facebook groups will get you a steady stream of opportunities.

Productivity

It can be difficult to focus when there are golden temples to explore and coral reefs to snorkel. But I’ve found these tools help:

  • Toggl - a very simple but powerful time tracker. It stops the clock when you walk away from the computer so you will only bill for productive time. Install the desktop app, don’t use it through the web interface.
  • SelfControl - ban yourself from certain web sites (Facebook, etc) for as long as you want. It is irreversible until the set time period has passed. An equivalent Windows app is Cold Turkey.
  • RescueTime - spy on yourself and generate a weekly report showing where all that time spent at the computer goes. It tracks web sites, apps used, etc. Each week it compares to previous weeks and tracks whether you’re spending more or less time on unproductive activities or not. Gamify your productivity!
  • Be Focused Pro - pops up alerts to support the use of Pomodoro Technique, a system of regular breaks at set intervals. You know that in X minutes you’ll be allowed a few minutes of online indulgence so it’s easier to keep on track until then.

Try to develop a routine that takes advantage of your most productive times (mornings, for many people) and involves less brain work when you tend to be less productive. Often a short nap during the hottest part of the day can really help.

Online collaboration

Your clients will love the ability to see what you’re up to and you need to be able to have some structure. Trello is perfect and I use it every day. Install the trello app on your phone so you never miss something your client says. Being quick to respond is especially important in order to try to compensate for time zone differences and lack of physical presence.

Try out something like Slack or Hipchat for real time text conversations. They have integrations with github and trello so everyone can see what's happening from inside the chat. 

Slowly wean your customers off email because it's an extremely inefficient way to manage work. It’s fine for having a conversation, but for tracking tasks and associated files it’s a massive time sink (a lot of which you won’t be billing them for).

Taxes / legal

If you’ve got customers in your home country, continue as you have been when you were a freelancer / independent contractor there. Reconcile your accounts once per month (I use xero.com for accounting and invoicing) then have an accountant look over your situation once per year to verify you’ve done it right and submit your tax returns for you.

If you have customers outside your home country then it gets more complex. It depends on your home country and what their laws around foreign income, tax residency criteria, and on and on are. Again, consult your accountant. There is a Tax and Residency Solutions for Digital Nomads Facebook group which may be useful.

DNs with customers in the EU might like to become an “e-resident” of Estonia to reduce their taxes and simplify financial arrangements with their customers. This is quite cheap and easy to do and services such as https://www.leapin.eu/ are here to make the process even easier.

Taxes are low and incorporating a company is quick and easy in Hong Kong and Singapore (not that easy, but easier than Thailand, Laos, Vietnam, etc). If you need a local address then use a mail forwarding service in Hong Kong or one in Singapore. If the bank asks why you need an account, don’t say “I’m an affiliate marketer who wants to avoid taxes” say something more respectable like “I’m a web developer moving to China to work”.

Getting paid

Ideally, your home country customers will deposit money into your bank account that you then access by using one of the methods in the next section.

However, if your customers are in a foreign country it becomes more difficult. Unfortunately, bank to bank transfers across borders are expensive and slow.

Many DNs use the following services in this situation

  • Paypal - ubiquitous, simple, well known. Payers don’t need a Paypal account. Very expensive.
  • Transferwise - similar to Paypal but much much cheaper and a transferwise account is needed for both parties. Sign up using my link and the first transaction is free.
  • Payoneer - similar to Transferwise. There is a single fee of about $3. As well as depositing into your bank account they can give you a MasterCard that deducts from your payoneer balance when used.

Transferring money, currency exchange

The simplest and most expensive approach is to put your Visa/Mastercard into an ATM and withdraw money. It's pretty easy because nearly all ATMs accept foreign cards and their interface is in English. The local bank and your home bank will both charge fees, and the exchange rate may or may not be fair. To minimize the damage, get the maximum the ATM will provide. Expect to lose about 3 - 4% of your money to bank fees if you use this method.

Depending on your home country, you might be able to find a bank which provides a card with less or no fees. With this method, the local bank will still be adding their fee. Prepaid cards intended for travelers can be helpful - they commonly give a certain number of free ATM withdrawals each month and/or low fees. Citizens of USA can get a card from Schwab bank that has no fees at their end AND will refund the local bank fees, which is incredible.

Be warned that the ATM's order of physically returning your card and dispensing cash will often be different than what you’re used to. This can cause confusion and sometimes leads to people taking their money and leaving their card in the machine.

If you’re planning on spending a lot of time somewhere then it will be worth getting a local bank account. A service such as Transferwise can be used to put money into it. Transferwise and similar services move money across borders for cheaper rates than the banks would charge (about 1%). Once the money is in your local account, withdrawing it from local ATMs will be practically free. Getting a local bank account can be exhausting and fickle. The application rules vary on which cashier you meet and the whole process is usually time consuming and bureaucratic. However, it will be worth it for some people's situations. How to get a bank account in Thailand.

Transferwise et al usually take a couple of days to do their work, so if you need money in a hurry then WorldRemit is still cheaper than an ATM. Cash can be picked up from various banks, money lending shops or pawnshops depending on which country you’re in. Check the WorldRemit site for details.

If you've got bitcoin (or can buy some in your home country, through the internet) then turning that into Thai baht or Philippine peso is super easy using either coins.co.th or coins.ph. The Thai version issues you a card to use in local ATMs while the Filipino version doesn't even need a card - just go to any ATM, press the right buttons and peso comes out! What a world we live in. 

Typical budget

There is a lot of misinformation around about what it costs to live in southeast Asia. People who have managed to live very cheaply will frequently and loudly share their expenses as if they were the typical case. In reality, they have usually made significant compromises in their quality of life (no air conditioning, noisy apartment, eating lots and lots of fried rice) to achieve that.

Prices vary between countries but here is the general ballpark you’ll pay per month. Prices are in USD.

  • Accommodation (1 bedroom): $300 - 500.
  • Transport: $300 - $500, including short distance flights, taxies, etc.
  • Food: $300 for western food, could be as low as $75 if you can do restaurants with no english on the menu
  • Entertainment: up to you. Beers are $1 - $2 each.

The total is about $1200 at a minimum. This is if you are very careful and doesn’t leave any breathing room for much fun and splurging. Realistically, you're looking at around $2000.

You can save a lot of money if you spend a few months in one place. You’ll be able to share a house with others in a cheaper part of the city, cook a few meals at home, find cheap local restaurants, and fly less. Living well near the $1200 level is easily achievable.