Nest eggs mean different things to different people. For digital nomads, those who work from their laptops as they travel, there are two main types of savings: a lump sum of burnable cash that allows them them to quit full-time jobs and start their nomadic adventures, and money for retirement. Some expats create a third nest egg: Cash squirreled away for when their nomadic lifestyle ends, and they return home with enough saved to make a downpayment on a house. Whatever purpose the money serves, it requires dedicated saving and smart investing. Here’s a look at how digital nomads, and their financial planners, plan for the future.
Focus on the BasicsDigital nomad and Forbes blogger Kavi Guppta says that after two years of slow travel, he’s learned a “ruthless discipline” with regard to his finances. While he uses his savings for further travel, it’s the process of how he saves that is the point, and his is to practice thrift in all areas of his life that allow it. “That can mean cooking all your meals everyday instead of going out,” he writes. “That can mean enjoying a cheaper bottle of wine over something fancy. That can mean wearing the two or three sets of clothes to work even if they start to show signs of wear. I’m more likely to choose a cheap flight to a new place than splurge on something that will collect dust in my apartment.” The reality is, of course, that even the most disciplined financial plan can go awry. And to that end, Becky Padmore, co-founder of Global Grasshopper, says to “expect budget blowouts. “ “Even if you’re the most prudent financial planner in the world,” she writes, “you will blow the budget now and then. You will be in exotic places, and you’ll want to try things you didn’t expect. Don’t deprive yourself of experiences. Leave some room for the occasional blowout — it’s going to happen anyway.”
Make Sure You’re Making Enough to SaveMost digital nomads are not on salaries; they’re freelancers and entrepreneurs selling services and products. Marketing consultant Ashanya Indralingam shares tips with GoWonder about how to find higher-paying clients:
- Ashanya doesn’t use freelance sites to find work, nor does she usually accept full-time roles when offered by contacts who find her on her LinkedIn account. Instead, she offers her services as a consultant, and relies on referrals and recommendations from professionals in complementary fields, with whom she’s networked over the years.
- She charges a lot. “An interesting thing to note that I have found to be effective is that I never reduce my hourly rate,” Ashanya writes. “Not only does this devalue my skills and services, but clients also consider higher rates as a mark of good quality. If you can, stay firm with your rate and turn down clients that attempt to lowball you — this only serves as a precursor to the pain they will cause you over the course of your professional interaction.”