If you're lucky enough to work from anywhere, you can take advantage of your freedom and work while you travel. Our own Stephanie Lee just spent the last nine months as one of these "digital nomads", with just a couple of suitcases and her laptop. Here are some practical things to consider if you want to be one, too. Illustration by: Sam Woolley
Why You Would Want to Do This
"Digital nomad" has kind of become an obnoxious buzz phrase, but it's an accurate way to describe this type of lifestyle. Freelancing is a more common way to earn a living, and remote work is an option for more full-time employees than ever before.
A digital nomad is basically a remote worker, independent contractor, freelancer: Anyone who can get stuff done from anywhere. If that describes your situation, you might have an opportunity to pick and choose where you want to work day in, day out. (And if you're not a remote worker, you could even convince your boss to let you work from home if you're up for the challenge!)
It sounds really exciting to be able to take your laptop and work from Central Park or Tokyo or wherever your desires take you. Of course, it's not always that easy in practice. You may have obligations to your pets, your children, your extended family, your home, or a partner. If you do, you'll have to consider them in your plans. However, even if you don't have those obligations -- let's say you're a single renter with no pets or children -- coming up with a plan still requires a fair amount of preparation.
You Definitely Need a Home Base
Digital "nomad" isn't entirely accurate. You still need a home base. Maybe it's your parents' house; maybe it's your own home. Either way, your bill providers, employers and banks probably require a physical address to set up your accounts. Plus, you need an address to receive mail.
The Australia Post has a couple of options that can help keep your mail under control while you're away. You could hold your mail for up to 12 months, for example. If you're back around that time, you'll get all your held mail delivered at once. You can also use their redirecting service to temporarily forward mail to your new address. Just keep in mind that if you move around, you need to update your forwarding address every time you move.
Of course, if someone lives at your home base, they could just hold the mail for you (and open anything important so you'll know what's going on!)
"My mail basically piled up by the time I got back," Stephanie said. "I told my mail caretaker (my dad) to flag anything important for me. I got lucky that I had someone to do this for me. But this is really important: make sure everything is taken care of online."
For example, you'll want to:
- Sign up for online-only bill statements and payments
- Sign up for direct deposit and ask clients to pay digitally
- Make a list of quarterly expenses like your car registration or insurance (and you might consider changing your vehicle status to non-use if you'll be gone for a while). This way, you can set up a reminder to pay them online when they're due, in case you're not home to get the mail.
The more stuff you can handle online, the less mail you'll have to deal with and track down.
You can also opt for "comprehensive-only" coverage with your auto insurance carrier. This offers a basic protection from things like theft, vandalism, fire or weather damage, which is ideal if you're not going to be driving the car. The carrier might refer to it as "storage" mode. Stephanie switched her coverage to storage and it cost $67 for the year.
Pick Your Temporary Home and Prepare for the Trip
Stephanie went to Japan, Hong Kong, Taiwan and South Korea, and she had friends and family in a few places, which made it easier to get by. If you know someone in a certain destination, and that person doesn't mind a long-term guest (or just a friend in the area), that might make it a more viable place to visit long-term.
It's one thing to visit a foreign place for a week or two, but there are some cultural considerations to make if you're going to be there for a while: The language, for example.
It may be easy to get around with tourist-level fluency if you just need to ask where the bathroom is and where to get good food. When you're there for a while, though, you might need to ask more complicated questions.
"Korea was probably the only country where I knew zero words," Stephanie said. "Except for thank you and hello. Everywhere else I kind of knew it or could get by. For the most part, if you go to the big cities you'll be fine."
There's also the matter of health insurance. Your overseas health insurance coverage varies, and you can check your Explanation of Benefits to see exactly what's covered and what isn't. If you have Medicare, you don't have any coverage outside of Australia. Most private standard policies at least cover emergencies, though, and Budget Traveller explains:
If a member experiences chest pains and thinks he's having a heart attack, an emergency-room visit would be covered, says Jackie Aube, vice president of product management for Cigna, "even if it turns out to be gas." James Coates, M.D., senior medical director for Aetna, says altitude sickness, broken bones, dog bites, heat stroke, and cuts requiring stitches are also examples of what would be covered under the standard.
Pinkeye, poison ivy, mild cases of the flu, and other maladies that don't put life or limb in serious danger are rarely covered abroad. And even if an initial symptom qualifies as an emergency, you'll probably have to pay for follow-up care overseas.
Still, you want to check with your provider to make sure you're indeed covered. (Also check if the country you're travelling to has a Reciprocal Health Care Agreement with Australia.) And if you're not, or if you want coverage beyond emergencies, you have a few options.
First, you can get travel health insurance, but keep in mind, that only lasts a few weeks. It will likely run you a few hundred bucks, and it's meant for short-term travel.
Second, you could also sign up for Australian-based international healthcare coverage, possibly through your current carrier. Be prepared to pay a couple thousand dollars for the year, though, according to digital nomad Anna Wickham.
On her site, The Worldly Blend, Wickham says the best option is applying for international health insurance overseas -- what she calls expat health insurance. She used a UK-based company called Integra Global, paying $US500 ($666) for six months' worth of coverage. There's a drawback, though: You're covered in every country except for the US, in case you were planning to visit there. She explains:
To include the US, your health care for 6 months goes from about $500 [$AU666] to about $1000 [$AU1332]. This is because health care costs in the US are totally and utterly outrageous. Integra Global is not capitalising on my need to be insured in the US. They are simply covering the high cost of American health care.
If you're self-employed, you'll probably want to go for the same deal, whether it's with Integra Global, Aetna International, Cigna Global or any other international insurer. If you're insured through your job, chances are, they're not going to cover your insurance while you're travelling, but you can always check with your HR department. If you'll only be gone for a month, you may just opt for travel health insurance.
Find a Comfortable Place to Stay
While there are different lodging options, from extended stay hotels to hostels, Airbnb is the go-to option for many travellers. And it's super convenient... but not for everyone. Discrimination on Airbnb is a big problem for a lot of travellers, and it's not limited to minorities in the USA.
A tool called Innclusive (set to launch in August) aims to fix that, and it's pretty much just like Airbnb except aimed at non-discriminatory hosts. In the meantime, Airbnb's anti-discrimination policy allows you to report any discriminatory behaviour. When you're searching for hosts, you may also want to filter by Superhost, or at least hosts with a lot of reviews. This shows they're at least experienced at dealing with a large number of customers, presumably from different backgrounds.
"I go for the big reviews because that way I know what to expect," Stephanie says. "An experienced host will know not to deceive because they value their high number of reviews and their super host status. They won't risk you writing a four-star review instead of a five-star review."
In picking your actual temporary home, whether it's Airbnb or any other lodging, there are a few specific things to think about:
- Time frame: Stephanie said she preferred to stay at a place for at least a month. This way, it gave her a chance to get into a routine in that place, so she could balance her work with sightseeing. "I do at least one-month stints so I don't have to shuffle around so much. Otherwise, it's really disruptive to my work."
- Location: You want to think about the location of your lodging, too. Are coffee shops and Wi-Fi readily available nearby, if you want to work outside of the house? If you'll be relying on public transportation, you'll probably want to find a place near transit.
- Workspace: Because you still need to get work done, you'll want a laptop-friendly space with room to designate as your office. Restaurants can add up fast, so you'll probably want a space with a kitchen, too.
Stephanie says she spent a lot of time mulling over reviews and talking to hosts, making sure they knew her plan and could accommodate. Many times the rate is negotiable, too, especially if you're going to stay for a month or longer.
Another tip: You may want to look for places where the host lives on the property. That way, you have a tour guide who can help you get settled, get around and offer recommendations -- and you have a friend, because, as Stephanie Points out, the digital nomad life can be lonely.
How to Set Up Your Remote Workflow
If you're working remotely, that probably means you need internet access. If you're visiting an area where Wi-Fi isn't readily available, you might consider a mobile hotspot or router so you have online access wherever you go.
Beyond the technical stuff, you want to establish a routine and boundaries. You're in a new place, and it's tempting to just forget about everything and go explore. On the flip side, you might get so stuck on work that you never make time to leave your temporary home, defeating the entire purpose of being a digital nomad. Stephanie said:
You have to be very rigorous about your schedule. Mornings I would work until noon. Then I would go out, have lunch, explore a little bit. Then I would find a coffee shop and get the rest of my work done. I gave myself one day -- Saturdays -- where I say yes to everything. During the week, I'd always think, "I feel like I should do this, but no, I should really get work done." On Saturdays, I'd just say, "F-it, I'm going to do it."
You're presumably in a different timezone than your colleagues back home, so that's another thing to build into your schedule. Overall, you want to come up with a work schedule and then optimise it based on your time zone. Front loading your work is key, Stephanie said. She suggests identifying your busiest days and work like crazy on those days instead of trying to spread it all out. This gives you ample time to explore on your less busy days.
You want to be courteous of your coworkers, too. Even when you front load your work, you'll inevitably have to communicate with them, and you want to avoid texting or emailing them in the wee hours of the morning, even though it might be prime time in your area. Tech can help with this. Most email clients allow you to schedule your messages so you can write them now but they will send later (Boomerang for Gmail does this, too). You can also snooze your own incoming email messages so you protect your quiet hours in your own time zone.
Consider all the Extra, Hidden Costs
Of course, the cost of renting a place month-to-month is going to be your biggest expense. It may or may not be more expensive than renting a place in your home city. Airbnb prices vary, too, with significantly higher prices during peak tourist season, or around major events.
"On the plus side everything is furnished and utilities are paid for with the Airbnb price," Stephanie pointed out." I paid $US1.100 for the month in Tokyo. It's a prime area and I can't say for certain but market rate is probably around that or higher."
And there are some other, less obvious regular costs, like:
- Transportation: Stephanie says this can add up fast, so you have to plan where you're going in advance and be efficient about it. Decide what parts of the city you're going to visit throughout the day and how you'll get there, then plan your transit stops accordingly. You don't want to get to one part of the city, only to buy another ticket back to your original spot to run an errand. Of course, some cities offer passes, and depending on the length of your stay, it might be worth investing in one.
- Food: Even though you're not exactly a tourist, you'll probably still spend more money on, say, going out to eat, than you would back home. Groceries and household staples might be more expensive (Stephanie said peanut butter, fruits and vegetables were pricier than she realised in Japan). The dollar might not take you as far, depending on where you go.
- Coffee shops and Wi-Fi: Part of the fun of being a digital nomad is working from anywhere, and you'll probably spend a lot of time in coffee shops when you travel. This can add up. If you join a coworking space, many of them charge a subscription or access fees. You could save money on this area by working for free from a library, though.
There are some savings that can offset these costs, of course. You'll save on petrol if you choose to walk everywhere instead of drive, for example. Bonus: You can explore more of a city's nooks and crannies when you're on foot.
You should also think about your taxes. Just because you can work from anywhere doesn't mean you need to work from anywhere, so writing off any travel-related expenses can be tricky. In order to write off work related expenses, the ATO says:
you must have spent the money yourself and weren't reimbursed it must be related to your job you must have a record to prove it (there are some limited exceptions).
If you're a freelance blogger who regularly writes about travel, you might be able to get away with writing off some of your digital nomad expenses. If you're a freelance web designer, on the other hand, you'll probably have a harder time justifying the need for travel.
Digital nomads are subject to the same tax implications as someone who works from home. Where they are staying at and earning income from is considered their tax home. They can take the home office deduction. If they are renting a room or hotel, they have to know how much of that space is considered their office to correctly deduct the right amount.
The rules get complicated quickly, though. Generally, if you're an Australian resident, you'll have to pay taxes on your worldwide income. You're also not subject to income tax in most other countries if you don't become a resident, but that could change if you stay in a country for too long. Here's how Stewart Patton, a tax attorney and expat entrepreneur puts it:
It's fairly common for countries to treat someone as a resident for tax purposes only if they stay for at least 6 months. It's often possible to restart the clock simply by hopping over the border for at least 24 hours.
So, simply don't stay in any country longer than six months per year and you should generally not be subject to non-US income tax.
Patton goes into even more detail in his full post, but your best bet is probably to work with a tax professional who knows this stuff in and out. Find a legitimate professional, then make an appointment with them before your trip and once you do your taxes.
With the right amount of preparation, it's possible to work and travel at the same time if you have the flexibility to work from anywhere.
Stephanie admits that the digital nomad lifestyle might not be sustainable long-term (mainly for sanity, she says). Eventually, you have to go back home, regroup and, you know, pick up your mail. Still, it's a great option if you want to see the world without disrupting your work life.