How digital nomads should arrange their finances as they travel the world.
According to research by MBO Partners, the State of Independence in America report reveals almost 5 million workers consider themselves to be digital nomads. And a staggering 17 million more are planning and hoping to become a digital nomad someday.
With faster internet connections and more affordable technology, the possibility of becoming a nomad has increased, allowing those who have a passion for traveling to live and work wherever they please.
However, there’s one issue that often prevails among nomads – a lack of financial stability.
Nomads tend to work for themselves. And so, they don’t have the security employment provides – such as a regular wage.
Despite this, there are a few ways nomads can set up their financial stability, and here’s how;
Fall Back Fund
Employees in countries such as the US are not legally obliged to receive pay if, for instance, they fall ill. But, according to Foothold America, 74% have a paid sick leave arrangement plan in place with their employer to support them when they’re sick.
However, digital nomads who often work self-employed don’t have these benefits, which can be unsettling.
As a solution, it’s wise for those who travel and work to set money aside from each paycheck to build a fallback fund to cover instances like illness. An emergency fund will give nomads a sense of much needed financial security and peace of mind.
Beyond saving a couple of months living expenses in an emergency fund, think about moving any additional savings each week or month into a diverse portfolio of investments to build long-term wealth.
Diversifying your investments will ensure your portfolio can overcome any economic downfalls.
Conduct research to find what investments you’re interested in and read more about the investment opportunity and company to assess their expected future performance.
For instance, whether you want information about where to buy bitcoin or want to find out more about foreign direct investments (FDI). Begin searching online and use reputable sources to increase your understanding of investing.
There will come a point in your life where you’re too tired to work anymore. Or you want the freedom and option to retire early.
Being a digital nomad doesn’t release you from your duty to support yourself later in life. Thus saving a portion of your money in a private pension plan is essential to provide you with the means to live well when you grow old.
Living a life as a digital nomad, traveling, and making a home wherever you please is ideal for experiencing the world. The freedom to roam across the globe gives nomads a sense of freedom and adventure.
But none of this makes nomads invincible from the financial curveballs life might throw their way.
For that reason, financial planning is essential for nomads to secure their present and future stability. In turn, ensuring they can afford a good living while traveling and their trip around the globe won’t need to reach an abrupt end.
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