Working remotely from anywhere in the world and changing countries every few months? What's there not to like?

During the pandemic, the digital nomad lifestyle took off in a big way, and more Singaporeans than ever are now location-independent and embracing the lifestyle of travelling the world yet working a regular job. 

Currently, there are over 35 million digital nomads worldwide, with a growing number each day! If you are thinking of jumping on the bandwagon and working from anywhere, there are a few things to keep in mind. In this blog post, we'll look at all the financial aspects of digital nomading and help you decide whether it is for you. 

Getting your finances right

One of the most important parts of becoming a digital nomad is getting your finances in order. There's nothing worse than being stranded in a foreign country and realising you have no money left. 

Save up for an emergency fund

Even if you're not trying to be a digital nomad, having an emergency fund is a must. Typically, you need at least three to six months' worth of living expenses which will cover your accommodation, daily activities, insurance, consumption, and internet subscription. 

After calculating how much you need, you can determine how much time is required to accumulate it. Start saving as early as you can to prepare your emergency fund. If you must, take on several freelance projects or part-time jobs to get your safety net up and running. 

Emergency funds will get you by when something out of the ordinary comes up. For example, you can get a ticket back home to the safety of your country when a global pandemic hits.  

Keep track of your expenses

The next move you should make is to keep track of your expenses by creating a budget. From the estimate you create for your emergency fund, make a more detailed breakdown and designate the amount of money you'll need for each item:

• Relocation and transportation costs: visa and tickets
• Housing and utilities
• Remote work support system (WiFi, workspace)
• Groceries and toiletries
• Health and travel insurance
• Savings and investments
• Entertainment expenses
• Debt repayments

After creating the budget, lodge each transaction into a notebook or download helpful budget apps like EveryDollar or YNAB to keep everything digital. As you go along, you might want to adjust your budget according to your monthly income and your destination's cost of living. 

Manage your taxes

Another financial component you should take care of is your tax compliance. If you are working for a foreign company, the good news is you don't have to report overseas income, and you don't pay tax! However, if you are working for a Singaporean company, you'll still get taxed according to your income bracket.

In addition, you also need to look at the regulations of your destination country. Some countries may allow you to work remotely and be free from tax liabilities, but others may not. It's better to check with the embassy when you apply for a visa to ensure you're not breaking any local laws. 

How to file invoices

Unless you're working for a company that allows you to work from anywhere, most digital nomads run their own businesses. That means you'll be managing contracts with different clients and companies almost every week. One of the most important things is learning how to manage your invoices to make sure your cash flow stays healthy.

You can do this manually by using an Excel spreadsheet for the schedule and a template. All you need to do is change the date, recipient, details, and amount and send it according to your spreadsheet. 

An easier way to manage your invoices is by using invoicing software that sends professionally designed invoices and estimates on time. I use this free invoice generator that can easily be copied if you're sending multiple invoices to the same clients. 

You'll also be able to track time and expenses or accept online payments, all from your laptop or mobile devices. Most of these software are free, but additional features may incur costs. 

Try to avoid using PayPal, even though it is one of the most common payment methods. PayPal has relatively high fees compared to Wise, Payoneer, or Revolut, and they don't give very favourable exchange rates if you're being paid in USD or Euros. 

Best credit cards and how to maximise it

When you go overseas, you might realise that there's a high fee for withdrawal via ATM or currency exchange. For example, the maximum allowed in many countries in Europe is 500 euros (S$726), and you'll expect to pay an ATM withdrawal fee of five euros from the destination bank, and another seven euros to 10 euros from your Singapore bank. Ouch.

Counter this by opting for credit, debit, and prepaid cards that offer benefits for travellers. I like using Wise, where you fund a virtual wallet and withdraw it. That way, not only do you save on fees, but you also can limit your spending to whatever amount you choose to fund your Wise account with. 

Here are some of the best multi-currency travel cards that can be used in Singapore:

• Wise Debit cards: You can access 40+ currencies, mid-market rate currency exchange, and up to two free ATM withdrawals.

• HSBC Everyday Global Travel Card: Covers 11 currencies and cashback on spending. 

• Revolut: Supports 150+ currencies, has a limited amount of free ATM withdrawal and a two per cent fee after.

• YouTrip Travel Card: Supports 10 currencies, co-branded with EZ- Link, and S$5 fee for ATM withdrawals.

Preparations before your journey

After getting your finances in order, the next to look out for is preparing yourself in other aspects such as:

Getting international health insurance

You need to pick a health insurance plan that you can use in other countries, as most of the SG-based insurance only covers you in-country.  Some suggestions are FWD, SafetyWing, AXA, MSIG, Cigna, Liberty, and Allianz. 

I use SafetyWing and find them affordable with an easy claim procedure, but they also have a deductible. I've also used Genki World but they take weeks to process claims and have a reputation for denying reimbursement, so I made the switch some years ago. 

Travel insurance

This will protect you when there are missed flights, theft, baggage loss, cancellations, or other surprises when you go overseas. Some of the more popular ones include MSIG TravelEasy, FWD Premium, Singlife Travel Lite, and AIG Travel Guard. 

I've used AIG Travel Guard and made several claims because of delayed flights and a lost bag, and they were efficient and supportive. The claim process was painless and quick, and the customer service was stellar. 

However, travel insurance doesn't work for me at this point as most policies are only valid if you are out of Singapore for less than 90 days, and I stay out of Singapore for most of the year. I have to buy international health insurance instead, but if you're the type of nomad who is based in Singapore and travels under three months at a time, travel insurance might be a good idea. 

Travel vaccinations

Going to a different country may expose you to infectious diseases that routine immunisation doesn't provide. Most countries provide a list of vaccinations required before you can visit, so check accordingly and consult your local healthcare provider. 

Invest in VPN 

A Virtual Private Network can be valuable to digital nomads because it increases your online security, protects your privacy, and bypasses geographic restrictions. By investing in a proper VPN, you'll be able to become more productive.

Some of the best VPNs that digital nomads use are NordVPN, ExpressVPN, and Surfshark. I've been using ExpressVPN for years, and although they aren't the cheapest, they are one of the fastest and most reliable. 

Learn the language

There's no harm in learning simple phrases before embarking on your journey. At the very least, learn how to communicate with locals to find out how to access public transport, dietary requirements, and emergency phrases. 

You can download apps like DuoLingo, Memrise, and QLango to get a headstart on the language. I've found that simply by speaking a few words in the local language, you'll get a friendlier welcome and better treatment and service! 

Join a community

Being a digital nomad can be hard, especially when you're new in a place. Take advantage of others' experiences by joining a digital nomad community online. 

In most popular nomad destinations there usually is a Facebook group. I've found Facebook groups for remote places like the Balkans, Eastern Europe, and Kuta Lombok, and they have been great for networking and apartment-hunting. If there isn't a Facebook group, you can try heading into co-working spaces or popular cafes to meet fellow nomads. 

Cancel all your subscriptions

To avoid wasting money, cancel local-based subscriptions such as newspapers, mobile phones, gym memberships, or your house's internet plans. I've forgotten all about my phone subscription several times and always seem to end up paying a month's subscription for something I won't use. 

Booking Your Flights

As a digital nomad, you'll be free to travel from one place to another when you're bored. But to maximise your efficiency, you should use the best provider. Make sure you compare prices from all the flight finder sites such as Kayak, Skyscanner, Google Flight, eDreams, or Trip.com. 

As a digital nomad, you can be flexible with dates, airport locations, and transits, so keep in mind the price differences and weigh them against the travel time. Compare booking a round-trip ticket to a one-way ticket and make the most of your dollar. 

How to Pick the Best Places to Stay As A Digital Nomad

If you don't have a destination in mind yet, here are some considerations before choosing 1:

1. Climate/season: As Singaporeans, you might favour warmer weather so pick your destination according to the climate and season that you're most comfortable in. Remember that you'll have to be prepared in terms of clothing and accessories if you decide to go somewhere colder.
2. Local happenings: Find places with local events that match your interests. I tend to favour the outdoor community so I pick destinations with events revolving around that, but there are plenty of places with a huge foodie and bar scene. 
3. Internet access: As a digital nomad, you'll be doing most of your work online, so make sure your destination has an adequate internet connection. I find that hot-spotting your phone works best in places with cheap data. 
4. Visa: Singaporeans have a high mobility passport, so you'll be able to visit most countries without a visa. For more detailed information, you should contact the country's representative authority to determine if you fulfil their requirements. 

There's also an option of getting a digital nomad visa that lets you work remotely for longer periods. Many countries like Croatia, Greece, Portugal, and Thailand offer longer stays if you can prove a monthly income. See a full list of countries here. 

1. Costs of living: To take advantage of currency rates, you can go to countries with lower costs of living. Singapore is one of the most expensive places to live in, so choosing a place to stay can be quite easy. 
2. Digital nomad community: No man is an island, and a digital nomad's life can be very isolating. If you're extroverted and need a social life, be sure to pick a destination where there is a vibrant community to keep you entertained. 

For reference, these are the best cities to work according to other digital nomads based on cost of living, communities, transportation, internet services, climate, and infrastructure:

• Bangkok, Thailand
• Bali, Indonesia
• Barcelona, Spain
• Budapest, Hungary
• Buenos Aires, Argentina
• Chiang Mai, Thailand
• Lisbon, Portugal
• Mexico City, Mexico
• Medellin, Colombia 
• Prague, Czech Republic

Booking monthly rooms or accommodation

After you decide on your destinations, it's time to book your accommodations. Here are some of your options as a digital nomad:

Short-term vacation rentals

If you require more privacy, you can opt for vacation rentals. These rentals are fully furnished apartments or houses that you can rent daily, weekly, or monthly. To find the best short-term rentals, you can use Airbnb, Vrbo, or Booking.com. 

Some cities might even have Facebook groups where you can find a good deal, especially in the off-season. I tend to book a day or two in a destination through Booking.com before I go on the hunt for an apartment or room that can be rented monthly. 

Hotels and hostels

If you need daily housekeeping, you can try hotels or hostels for a short-term stay. I don't recommend using hotels or hostels for longer than a month, as it could be costly. To find the best hotel and hostel deals, check out Booking.com, Agoda, Trivago, or Tripadvisor. 

Co-living spaces

One of the best places to stay as a digital nomad is a co-living space. It provides privacy with individual rooms, but also community rooms where you can socialise with other digital nomads. They often offer work spaces with excellent amenities, so you can be more productive. 

Use specific co-living search sites such as Coliving.com, Coliving Compass, Nomad Stays, or Colive Pro to find co-living spaces in your destination city. 

Where to work as a digital nomad

As you settle into your new destination, you should also scour the local scene and find places where you can work as a digital nomad. Here are some of your options:

Your accommodation

If you live in a co-living space or an apartment with adequate internet connectivity, you can work from your accommodation. It's a cheaper alternative but can get monotonous at the same time. I'm extremely introverted and have no problems being alone all the time, but the life of a digital nomad can be a lonely one if you're constantly at home alone working all day. 

Co-working space

This is the most popular option for digital nomads because it provides office amenities such as printers, meeting rooms, and refreshments. You can also mingle with other remote workers and expand your social circle. It can be pricey, but the benefits make co-working spaces worth a try.

Coffee shops

A fun way to explore your new neighbourhood is by going to local cafes and using their WiFi. You can get a caffeine boost or grab a snack while you're at it. However, cafes can get a little noisy, so this might not be the best place for meetings or Zoom calls. 

Also, if the cafe fills up and there are no more empty tables, you might want to make way for someone who will buy something more than a single coffee. Nomads have a notoriously bad rep for ordering a coffee and taking up space all day, so don't be that person!  

Local library

Depending on your location, libraries are excellent places to work. Most libraries provide great access to reading materials, WiFi, and even office amenities for free. The downside is you can't make phone calls or online meetings in the library, as you're required to keep the noise down.  

Entertainment and recreation

The key to the best digital nomad life is balancing work with play, so make sure you spare some time for entertainment and recreation. Here are some tips to get the ball rolling:

Join a community and ask fellow digital nomads about local happenings. As mentioned earlier, Facebook is usually a good start. 

Join digital nomad events in your destination where you can network and have fun. 

Visit local attractions such as beaches, markets, festivals, outdoor activities, or workshops and meet some locals and expats alike! 

Final Thoughts 

Digital nomading is on the rise, and millions around the world are already location-independent. If you are looking to join the fun, good luck, and we hope that your travel dreams all come true! 

ALSO READ: The best cities for remote work, according to a digital nomad

This article was first published in MoneySmart.