During my journey as a digital nomad, I have been constantly learning how essential financial planning for traveling is for me to achieve my goals with The World in Sandwiches Project.
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And this is not by coincidence: in order to live far from home and have a minimum of comfort, it is part of the process to face daily costs with accommodation, food, among many others. And the loss of part of the income, for example, can cause a series of problems.
We don’t want that, right? So, I decided to talk with the financial consultant Gustavo Rosa, who shared with me 5 decisive steps to have a financial plan for traveling.
The professional’s tips were very important to me and I hope it will be very useful for you too!
Stay here with us and have a great read!
Before we start, it is important to talk again about the concept of digital nomadism, a lifestyle that has been gaining more and more representation in the home office era.
Following an estimate from the website Nomad Life, we will have 1 billion nomadic workers worldwide by 2035.
The subject is trending and recently I had the opportunity to talk about it, including for a Forbes article (Article in Português), about working wherever we are.
But what is the point? We don’t go to a destination just on a visit. We go to work and, in our free time, explore the place and live the objectives proposed in our life project.
And that allows us to breathe a little more, because there will be a financial income coming in daily – or monthly – to support this lifestyle.
But that doesn’t mean we can’t have a bad surprise or that we don’t need to control our spending. The exact opposite! You need to get serious about financial planning for traveling, and that starts before you even leave home.
I’m talking about saving your financial reserve, doing some good research on your destination and other tips I’ve prepared for you on how to be a digital nomad spending a small amount of money.
Now that you’re in context, let’s get to the financial advisor’s tips!
1. Discipline must be your main commandment
Keep a record of all your costs while on a trip. Write down everything! Expenses with accommodation, food, transport, health, internet and whatever else you do.
This will be essential to be more assertive on your next trips and to fully understand what your fixed costs are to live with minimal comfort. You will see your finances clear
2. Beware of ‘invisible’ costs in your travel financial planning
You know the coffee you have at the bakery every day or the delivery you ask when you don’t feel like cooking? If you add up each of these costs, you may be negatively surprised by the amount of money that was wasted.
I’m not saying that you need to cut them out radically, but that they need to be included in your travel financial plan so they don’t go unnoticed.
3. Don’t get into debt
Another very important point is to avoid having debts as much as possible. If you have any financial issues, resolve them before you even leave for your new destination. This makes it much easier if you have a decrease in your salary.
This is no different during your trip, so avoid credit card purchases and other debts that can be harmful to your finances as much as possible.
4. Learn to live with the bare minimum
This tip is for life and it’s impossible not to share it with you! Ask yourself what you really need to live in that particular destination.
Certainly, to be able to work remotely, you will need a good laptop and a cell phone with a great camera, as well as some clothes and personal items.
This is enough and learning to live this way will greatly reduce your costs, it will be great for you to save money and it will help you make good financial planning for a trip.
5. Financial reserve
We left it for last because this is certainly the most important item. Having an important financial reserve is essential for the digital nomad journey. It is a mandatory item in your financial planning for traveling.
Remember the first tip given by Gustavo, about writing down everything you spend? It is the starting point to know what your cost in a month. Ideally, you should have at least six times that amount saved for an eventual loss of income.
Gustavo said that the perfect scenario is the equivalent of 12 months, but six months is fine to start with.
It feels like a hard journey, doesn’t it? But with daily steps you can change your lifestyle and build a financial planning for traveling.
When you live the tranquility that comes in the next step, you will certainly understand how balanced finances allow us to live in a lighter way, without future problems.
Did you write down the tips?
So, be sure to share them with that colleague of yours who is planning a next destination.
See you in the next post!