Rather than contribute to the endless nomad lifestyle hustler deluge of how-to manuals and ebooks, I thought I would offer up what I think is more practical advice when it comes to how to become a digital nomad.
I initially started out living like this because I was, in typical spoiled western fashion, fed up with my comfortable corporate job. I couldn’t bear the thought of another year of meetings about meetings and sterile office Christmas parties and I wanted more than a couple of weeks per year to enjoy the 6-or-so decades I might have on this planet, so I took a chance on digital nomad-dom.
Throughout my time as a nomad, I have learned a thing or two–some things the hard way–about what it takes to both start the lifestyle and make it work. The following is a breakdown of what I see as the fundamental knowledge you should have before setting the wheels in motion. They are (for quick reference):
- Digital Nomads and Geographic Arbitrage
- Live Below Your Means
- Know What You Get Vs What You Give Up When You Pursue This Life
- How to Be a Nomad The Right Way Means Creating a Routine
- Downsizing Your Life and Getting Rid of Things
- Find a Niche That Allows You to Develop Marketable Skills
- Be Environmentally Friendly However You Can
- Some of the Most Popular Nomad Jobs
- Remote Work Helpful Groups and Websites
- Negotiating Rent
- Banking and Taxes
- Making Sure You Have Wifi
- Choosing a Credit Card
- Travel Insurance
- Events and Meetups
- Working While Traveling
Digital Nomads and Geographic Arbitrage
There are essentially two reasons people around the world are in such a hurry to become “digital nomads.” Both are easy to understand.
The first is that people very much want to get out there and see the world. The idea of a 9-5 life that affords you a couple of business weeks’ worth of paid (or maybe even unpaid) vacation every year seems like a poor use of a human life, given the extent to which relatively inexpensive international travel is now possible (at least for the time being).
The second is to take advantage of what is known as “geographic arbitrage.” Arbitrage is an economics term that basically means taking advantage of price (or cost) differences in order to maximize profit. If, for example, you know that you can buy product A for X in one place and sell that product for X+1 in another place, you’re exploiting the price difference between the two markets to make a profit.
Banks and other financial institutions engage in all sorts of financial arbitrage all the time, and as a digital nomad, you are doing pretty much the same thing. If you are a remote worker employed by a UK company making GBP while living in Portugal, where the considerably lower cost of living allows you to save more of your money, you are engaged in geographic arbitrage.
But you don’t need to go internationally however for geographic arbitrage to apply. The family of four living in San Francisco during the pandemic is all of a sudden completely untethered to the Bay Area thanks to remote work and decides to pack up and move to Arizona to enjoy both the lifestyle and the significantly lower cost of living, while still making those big SF bucks, is also engaged in geographic arbitrage.
Live Below Your Means
I think you should take any financial advice from nobodies online with the most microscopically small grain of salt possible. The internet is awash in counterproductive, hair-brained and outright false financial punditry.
What I do think is a sound money management philosophy to live by, however, whatever your personal financial circumstances are, is to live below your means. Geographic arbitrage only works, after all, if you don’t increase your spending as your costs fall and income rises.
If you can avoid the temptations of living a more luxurious lifestyle than your income would afford you in your home country while living somewhere else, you will be able to save the kind of money that might help you eventually do something like start a business and set yourself up for long-term financial stability.
Know What You Get Vs What You Give Up When You Pursue This Life
I’ve been a digital nomad since 2015 and it has been the most fulfilling and exciting period of my life so far. I’ve met interesting people I otherwise wouldn’t have met, seen and lived in places I’ve always dreamed about, and become much better acquainted with myself and the world. I wouldn’t trade the past 7 years for anything.
But, as with anything, there are tradeoffs. I quit a job at the bank and had a (likely) stable, if not unfulfilling career ahead of me. If you’re going full “digital nomad” and starting from the ground up, leaving behind valuable professional acumen and industry experience you have spent years building, consider that you may be seriously handicapping yourself economically.
Many of the jobs that are often regarded as typical nomad jobs are poorly paid and will not offer you much in the way of marketable skills. Should you decide you want to transition back into the labour market at some point, you may find that you have been left in the dust by your non-nomadic peers and there is not much demand for what you have to offer.
If you listen to many of the social and economic pundits out there right now, and if you have been paying attention over the course of the last decade or so, the economic stakes are higher for humanity and individuals than perhaps at any point in the last 100 years. Bad economic decisions made now–digital nomad-dom included–could be devastating.
Another thing you give up when you decide to travel full time is stable relationships and familiarity. I think adaptability is a learned skill, and I’ve gotten pretty good at constantly uprooting and resettling over the past several years (if I may say so myself).
If you have a routine, however, that involves friends, family, work, and extra-curriculars like intramural sports teams or exercise, built over years, know that lot of that goes away.
How to Become a Digital Nomad The Right Way: Creating a Routine
With all of that said, it is possible to recreate a routine every time you change locations. I’m a creature of habit and my routine is important to me, so I’ve gotten quite good at establishing a routine every time I land somewhere new.
This process involves things like finding a cafe I like, finding a gym, getting to know the area, learning public transportation routes and finding out which (if any) areas should be avoided. Finding a gym is not always possible when you are somewhere new, but there are ways to work out without needing the gym infrastructure. You might find some of our guides on travel workout equipment helpful in this regard.
Downsizing Your Life and Getting Rid of Things
Becoming a digital nomad, by definition, means becoming something of a minimalist. If you are traveling indefinitely, you either get rid of most of what you own, put it into storage or get someone to look after your place for you.
In any case, you are forced to make decisions about the few things you will end up taking with you. The vast majority of what I own is clothing. I’ve got my laptop, a phone, a bunch of cords and my various pieces of outdoor gear with me, but that’s about it.
Depending on the kind of travel that you want to do and the kind of digital nomad you want to be, you will need to both get rid of and acquire some things. If you are someone for whom the digital nomad lifestyle is driven in large part by a desire to see nature and wildlife, you might find my guide on nature travel and wildlife tourism helps reconfirm your decision for you.
Find a Niche That Allows You to Develop Marketable Skills
The life of a digital nomad is, very often, the life of a freelancer. Sometimes people become digital nomads by starting a business that allows them to live and work on the road, or they are lucky enough to work for a company that allows remote work from anywhere. But very often, digital nomad-dom means online work, and online work is typically poorly paid unless you have some advanced skills.
The digital nomad life often gets irresponsibly glamorized by people already living it and living it well. But for every travel blogger/vlogger making a six-figure income talking up the beauty of a completely unrooted life, there are plenty of nomads eeking out a living as poorly paid, precariously employed virtual assistants, freelance writers and online English teachers.
What’s more, if you are from an advanced northern country and you are working in the online gig or freelance economy, you are very often plying your skills and selling your labour alongside people from developing countries. These are people who speak great English and have solid digital skills (in marketing, programming, design, etc.) but who live in countries where the cost of living and average salary are far lower.
The economic dynamics in such a market are predictable. A glut of people who are willing to work for far less money than you depressing the market price of things like copywriting, programming and digital marketing skills.
If you left a corporate job in the West and thought you were going to live a romantic writer’s life traveling the world, you may find it quite demoralizing to learn that a young guy or girl in Nairobi, Kenya or Karachi, Pakistan or Belgrade, Serbia speaks English just as well as you but is willing to work for relative pennies, meaning what you can demand drops significantly in most cases.
This is why you need to have a plan of attack before transitioning into the digital nomad life. If someone were to ask me today how to become a digital nomad, I would vehemently stress the importance of planning out the economic transition before going fully mobile.
Do your labor market research before deciding on a career path (whether that involves selling skills you already have or looking for new ones) and consider investing in education simultaneously.
Be Environmentally Friendly However You Can
Another thing that I believe doesn’t get nearly enough attention is being an environmentally responsible nomad. With the remote work revolution in the wake of the pandemic and the many millions of people around the world who suddenly became completely mobile, digital nomad life has been getting some not undeserved bad press.
There are a couple of things that I think people who travel and work can and should do to minimize their impact on the destinations they choose. The first is to be conscious of plastic waste.
Most developing countries have highly inadequate waste management, which means trash (and particularly plastic) is a major environmental issue.
Asian countries have the worst plastic waste problem in the world, so if your digital nomad life takes you to SE Asian paradises (as it has me) do your part to minimize the amount of plastic you contribute to the problem.
Of particular importance is to say no to plastic bags. There is a complete lack of education (combined with carelessness) about the plastic problem around the world and you will get a plastic bag pretty much any time you buy anything anywhere.
Additionally, it is important to accept that if you are travelling by air on a regular basis and going to countries with poor waste management, your ecological footprint is likely appalling. You can offset it in other ways, of course, but the digital nomad lifestyle, done carelessly, can be quite carbon-intensive and environmentally destructive.
Some of the Most Popular Nomad Jobs
Below are some of the most popular jobs that digital nomads tend to do:
- Remote Customer Service Work
- Virtual Assitant Work
- Online English Teaching
- Freelance Writing
- Software Development
- Web Design
- Affiliate Marketing
- SEO Agency Work
This is by no means an exhaustive list but based on the people I have met over the years, these are the most common jobs for digital nomads to have. Consider whether these are things you are equipped or want to do and, as I mentioned, know what you stand to earn doing them.
Remote Work Helpful Groups and Websites
If you are taking up freelance work to fund your digital nomad lifestyle, you will likely have periods during which you don’t have enough work. You will need to hustle.
Eventually, the goal is to have enough of a body of work and a reputation for reliability and quality that you don’t have to wait long for that next project. When you are first starting out, and even sometimes unexpectedly thereafter, you will have to search for money.
As previously mentioned, online work has become, while not entirely, a very noticeable race to the bottom in many niches. Sites like Fiverr and Freelancer are inundated with mind-bogglingly low bids from digital workers in developing countries and it can be very hard to find fair pay for fair work.
This is why having a solid Linkedin profile as a digital nomad is so important, which includes a robust network of other professionals in your industry. I have also found that digital nomad Facebook groups and ex-pat groups in the various countries and cities you travel to are often good alternatives or supplements to the big freelance sites.
By all means, create profiles on places like Fiverr and Freelancer–they aren’t devoid of good opportunities. But you should always be diversifying your sources of freelance work and looking for less saturated labour markets.
An important part of learning how to become a digital nomad is learning how to lower your rent expense.
When you travel the world as a digital nomad, you are often not in one place for very long. What this tends to mean is that you are stuck in the Airbnb rental market paying inflated prices. The Airbnb market in a lot of places–especially ex-pat and digital nomad hubs–charges prices that are far above the rest of the domestic market for a few reasons.
Most of the clientele is international, meaning owners can charge international prices. The places are furnished and come with utilities included, so you pay for that. And they are usually short-term (a month or two), so the owner doesn’t have the security of a 6-month or year-long contract.
As of late, you also have to factor in quite a significant increase in Airbnb’s now ludicrously high service fee. If you want to live in a safe neighbourhood, in a comfortable place, close to amenities, you can end up not really saving a lot, depending on how you go about it.
Whenever you are looking for a longer-term (a month or more) rental, do two things: first, if the host hasn’t already set a sizable monthly discount on the property, check and see if they are open to it. Second, try and see if they are amenable to negotiating a cheaper rate outside of Airbnb.
If you’ve got good reviews on Airbnb, people are often open to cutting out the platform and doing business independently (sometimes with a contract, sometimes not). I’ve saved a lot of money over the years simply by asking hosts if they want to exchange Whatsapp numbers and negotiate a rate that doesn’t include an Airbnb fee and is paid in cash.
Banking and Taxes
One of the most important considerations for anyone wanting to know how to become a digital nomad involves tax liability. I’m not a tax expert, nor do I have any country-specific information on tax rules outside my home country of Canada, so I’m not going to advise you to do anything other than look carefully at what your country requires/expects and to always set aside any money you earn for taxes.
Know what the issues surrounding international income, residency and filing are before jumping into the digital nomad life. This is particularly important if you eventually decide to start your own business.
Additionally, if you are traveling internationally indefinitely, any tax you do file in your country of residence is likely going to be e-filed, so consider investing in one of the many e-filing solutions out there. If your income streams become complicated and you think your taxes require the assistance of an accountant, that might also be something you eventually consider paying for as well.
Making Sure You Have Wifi
I’ve thankfully never needed a fantastic wifi connection to do what I do, so I’ve never really had to select my destinations based on wifi reliability. I’ve definitely lived with some pretty infuriating wifi connections, but I’ve also always done a few things to hedge my bets.
For instance, if you know you’re going to be somewhere for an extended length of time with spotty internet, always get a local SIM card. You can do this when you land or after you’ve settled in, but being able to use your phone’s data when necessary is so important.
I spent one month in this paradise in Aceh, Indonesia so I could snorkel every day, but the tradeoff was a terrible internet connection that was almost unsuable. I compensated for this by renting a scooter and riding back and forth into the town of Sabang every week to top up my data.
You can also improve your connectivity by traveling with a wifi extender. A wifi extender rebroadcasts a router’s wifi signal so that dead spots in a house, apartment, hotel, hostel, cafe, etc. aren’t such an issue. Wifi extenders range from around 30 to 140 dollars.
If you’ve been paying attention to business and tech news over the last couple of years, you know that cybersecurity is a hot topic. It seems like since 2020, we have seen a neverending list of headlines about data breaches, ransomware attacks, crypto heists and phishing scams.
Working remotely comes with serious cybercrime risks. Anyone who wants to know how to become a digital nomad in the 21st century would do well to inform themselves of the considerable cybersecurity threats that exist and what to do about them.
Perhaps chief among them for digital nomads is working on unsecured networks. When accessing the internet at an airport, cafe, restaurant, hostel or hotel (even an Airbnb, as they sometimes have shared connections) you are exposing yourself (and your clients) to fraud. Cybersecurity was one of those things I learned the hard way, after having my credit card information compromised, I’m ashamed to say, more than once.
Doing things like using a VPN (free or paid), regularly updating your software and operating systems, avoiding sending and receiving sensitive (especially financial) data while using public networks and making use of two-factor authentication, strong passwords and a password manager makes this lifestyle much more cyber secure.
Choosing a Credit Card
The world is more cashless than ever before and if you’re living the digital nomad life, your credit card is indispensable. Your credit card is how you pay for flights, rent and, depending on where you are in the world and which ATMs accept your debit card, access cash.
It makes sense, therefore, to choose a card that gives you the best rates and rewards. Having a card optimized for travel is a strategic part of how to become a digital nomad. This means looking for credit cards that give you things like double air miles, cash back, discounts at hotels, and lower or waived withdrawal fees when you use them at a foreign atm.
I was pretty cavalier about travel insurance when I first started living abroad, despite doing things that I knew were risky. I’ve spent a lot of time in very rural, remote, underdeveloped places where safety is an afterthought when it comes to things like road and infrastructure maintenance.
In short, I’ve realized that a lot of what I do for fun comes with some serious health and safety risks and would urge anyone interested in how to become a digital nomad to invest in travel insurance.
Prices vary widely based on the coverage you want, your destination, activities and prior medical history, but for a few hundred dollars you can protect yourself against potentially ruinous circumstances.
Stories abound of wreckless tourists requiring long hospital stays and expensive surgical procedures in foreign countries who then walk away with life-altering medical bills. Or, even worse, who are sometimes denied treatment upon arrival at a private hospital (you rarely want to opt for public medical care in most places outside the west) because they have no insurance policy and not enough cash.
The bottom line is: if you know you are going to be taking risks with your life and health, calculated as they may be, and even just as protection against the unexpected, invest in travel insurance.
Events and Meetups
Articles about how to become a digital nomad rarely delve into the social side of the lifestyle. When you travel the world on your own, usually leaving behind friends and family wherever you come from, a vibrant social life becomes more difficult for obvious reasons.
Social media, for all its negatives, makes meeting new people and maintaining a social life much easier. There are Facebook groups for digital nomads, plenty of apps to meet people abroad, and quite a few seminars and networking events around the world every year for digital nomads.
These meetups are often industry-specific, but they draw a lot of people who are doing what you’re doing and can be great ways to find and nurture both business and personal relationships.
Working While Traveling
An important thing to keep in mind while living as a digital nomad is that you aren’t technically supposed to be working in most of the places that you live.
Work visa rules are designed to protect the local labor market and for tax reasons, and while you aren’t stealing a job from a local while working remotely, and you are pumping money into the local economy, I would wager most digital nomads aren’t allowed to be working in the countries they visit.
For this reason, whenever a government official asks you what you are doing in the country, it’s best to just state tourism (which you are certainly there for) and omit anything related to work. When you need to specify what you do for a living, keep it vague and perhaps mention you are on holiday (which you also are).
With that said, and if your digital nomad plans include relocating somewhere on a much more extended basis, there are plenty of countries that offer digital nomad visas (i.e., a non-legally-grey avenue to live and work in the country).
With the new remote work trends and many millions of people around the world now completely mobile, that list of countries is growing as more places seek to boost and revitalize their tourism industry.
How to Become a Digital Nomad and Live the Life
The above guide has hopefully provided you with enough information both on how to be and how to become a digital nomad right now. Living in and experiencing different parts of the world is a massive privilege and something that is only made possible by global, digital modernity.
It is also not without its downsides, as well as its pitfalls. I firmly believe that becoming a digital nomad can be a strategically bad long-term decision that does nothing to set you up for financial stability once you decide you want to stop living the life. Use the above as a road map and you will hopefully get to enjoy both great life experiences and long-term success.