Budgeting for Remote Living
If you’re reading this article, you’re either already on the road and want to start managing your money better, or you plan on hitting the road in the near future. The tips discussed today will help in either scenario. If you are already living on the road, kudos to you for exploring ways to budget better. And if you haven’t left quite yet but want to soon, it’s excellent you’re planning early!
The first step in successful budgeting is to look at your current expenses. I suggest breaking this up into fixed costs (ex: rent, car payments, health insurance, cell phone plans, etc.) and variable costs (ex: groceries, gas, activities/entertainment, etc.). This is your baseline for what you’re currently spending day-to-day. From here, you can calculate how much you should have in your savings based on this formula: 6 months of expenses + an emergency fund if something goes wrong. For many people, building up to this savings goal will take time. The important piece of this is not immediately having that amount saved but knowing the dollar amount you want to work toward.
If you haven’t started to live remotely yet, this section is for you. The next step is to create a budget to make this dream a reality. Are you planning on buying a van and traveling around the country? Do your travels extend internationally and do you plan on sleeping in hotels/Airbnbs most nights? First things first are to decide what remote life looks like for you, and then you can begin to budget for that. Another important thing to figure out is if you plan on working while you travel. If not, we recommend having enough in your savings for you to cover your monthly expenses and an emergency fund in case something goes wrong. When traveling, things come up all of the time. Airbnbs aren’t as clean as their pictures, cars break down, you can get sick, etc., etc. Having an emergency fund to take care of these inconveniences will save a lot of stress down the line.
Before I and my husband began van life, we saved up for two years. We cut back on our expenses and tried to build our savings up as much as possible. We quit both of our jobs to travel which required us to have a lot more saved up since we wouldn’t generate any money on the road. It’s important to remember that every person’s situation is going to look different. Building up your savings to a comfortable place may only take a year, it may take several years, or you may plan on working on the road and are more comfortable leaving with fewer savings.
One thing I wish I did sooner made my money work for me. For example, opening a high-yield savings account or investing in a low-risk index fund is another way to earn a return on your savings while living remotely.
You’ll find the advice out there on budgeting varies so much because everyone’s goals are different. The best way to tackle your budget is to write down what you’re currently spending, discuss what your goals are (i.e. traveling full-time for 6 months without working, working full-time while traveling for an indefinite amount of time, etc.), and then discuss what else you can do with your money to get a better return on your savings.
