14.07.2021 | 10 minutes estimated reading time | Print this article

What is a digital nomad?

Historically, a nomad was a person who wandered from place to place, often in pursuit of a particular goal. These nomads included hunter-gatherers, pastoral nomads and tinker/traders. In recent years, however, this list has grown to include the digital nomad, whose work is facilitated by modern technology and can be done completely online.

With the pandemic meaning that many people have been working remotely, the digital nomad lifestyle suddenly seems more appealing and accessible to more people.

This guide explores who digital nomads are, how to become one and provide tips for remote working.

Who are digital nomads?

Digital nomads are individuals who can do their job totally online from anywhere, at any time. For example, this could be someone who works in marketing from a foreign country or a photographer travelling around in a recreational vehicle. People who work in marketing, for instance, often only need a laptop, a phone and an internet connection, so they can simply take themselves wherever they please and work remotely.

What is remote working?

We’re probably all now familiar with the term ‘remote working’, also known as telecommuting, as a style of working that allows you to work outside of your usual office environment.

Working remotely enables you to travel, work from cafes, from home or even work from a recreational vehicle such as a campervan.

Has the pandemic boosted remote working?

The Covid-19 pandemic has broken through cultural and technological barriers to facilitate a new way of working that could result in a real cultural shift. During 2020 in the UK alone, 86% of people who worked from home did so because of the pandemic.

When it comes to the future of work, it seems likely that many employers will offer a hybrid working week, with some days in the office and some days working remotely, which may still allow people to live a semi-nomadic lifestyle if they wish.

How working remotely can save you money

There are a few ways that remote working may save you money and potentially get a lump sum together that you might choose to invest or save. Some of the areas where you can potentially save money if you’re working remotely include the following:

Commuting

In 2017, London had the most expensive monthly travel costs in the world, with the Oyster card costing £135 per month. Overall, Britain’s commuters spend 492 days travelling to work and over £37,000 in commuting costs during their lifetime, as shown in a 2019 study revealed by Lloyds Bank. That’s a lot of money and time saved when you can switch to remote working.

Uniform

The total weekly expenditure made on clothing and footwear by all households in the UK was £181 million in 2020, according to the Family Spending Workbook published by the Office for National Statistics (ONS.)

If you splash out on new clothing for work, this is a cost that can be eliminated when you work remotely. Aside from virtual meetings and occasional mandatory in-office meetings, you won’t need to purchase new work clothes for the office.

Childcare

Childcare is a huge expense for many people. If you and/or your partner can work remotely, you might also be able to eliminate childcare costs, whether completely or partially.

Dog walking/pet sitting

Pet sitting can be a huge cost if you don’t want to leave your animals alone during the day, and the average dog walker in the UK charges £10.73 an hour – or up to 34% higher than that, depending on where you live. By working remotely, you’ll be able to both be there for your pets and cut out the costs of paying someone else to do so.

Tax relief

If you’ve been asked to work from home by your employer and there has been an increase in your utility bills as a result, you might be eligible to claim working from home tax relief. Such a claim could even result in you receiving a lump sum, which would give you a good opportunity to invest, save or simply treat yourself.

With the money you’re able to save by working remotely, you might want to consider making it work for you by opening a new savings account. Saving accounts such as fixed rate bonds typically come with those hard-to-come-by competitive interest rates.

Compare fixed rate bonds

Pros and cons of remote working

Does being a digital nomad sound idyllic? It is to many, but it also has its disadvantages, which are worth exploring before diving into this type of remote working lifestyle.

Pros

  • No commuting
  • Freedom to travel
  • Flexibility
  • Reduced workplace stress
  • Childcare and pet sitting are potentially no longer needed

Cons

  • Disconnected from colleagues
  • Often responsible for your taxes
  • Your overheads may increase (utilities, food, IT)
  • You may feel less productive/motivated

Are UK employees really the most reluctant to return to the office?

Despite hybrid and remote working being an attractive incentive for retaining employees in the wake of the pandemic, many companies are yet to implement a hybrid schedule. This is despite a 2020 survey by HR software company Personio which revealed that 1 in 4 employees would resign if they were forced to return to the office.

Compared to mainland Europe, employees in the UK are more reluctant to return to pre-pandemic, office-based working, with 30% of us wanting to return to the office on a part-time basis. This is a contrast to the 59% on mainland Europe.

How to become a digital nomad

To become a digital nomad, you’ll need to find a job that allows you to work remotely – or set up as a sole-trader or self-employed and build a business that facilitates remote working.

If you’re employed, becoming a digital nomad is likely to be easier if your existing job is one that easily facilitates remote working and doesn’t require you to be in a specific location – an accountant as opposed to a nurse, for example.

If your existing job, or employer, won’t allow you to work remotely, here are a few steps you can take to become a digital nomad:

  1. Get experience in a role that can be done remotely

You could do this by switching in-house roles, training in your spare time, enrolling in a course at university, or completing an internship.

2. Offer your services online in your free time

By signing up to a popular digital nomad platform such as Freelancer in your spare time, you’ll be able to get your first clients and take your first steps towards becoming a digital nomad.

3. Make the move to full-time remote working

Once you’re established and have a big enough client base to support yourself, you can choose to leap into full-time remote working.

What jobs are out there for digital nomads?

Some jobs will never be remote, such as a radiographer or farmer. The most common remote-working jobs are digital or require all your work to be completed online.

If you have a particular passion, interest or skill, such as teaching a language or designing websites, you could do this job remotely. Some of the most common digital nomad jobs include the following:

  • Graphic designer
  • Content marketer
  • Software developer
  • Stock traders
  • Tutors
  • Transcribers
  • Bloggers
  • Social media influencers
  • Virtual assistants
  • Copywriters
  • Photographers
  • Translators/proofreaders

Where are the best destinations for digital nomads?

Ultimately, the best destination for you as a digital nomad will depend on what you’re after, but we’ve taken a look at some of the most likely motivations of digital nomads and the destinations that offer them.

Low tax countries

As a digital nomad, if you choose to become a resident of a territorial tax country, you’ll only pay income tax on earnings generated while you’re in that country, meaning any foreign-generated income is exempt.

This means that if you’re a resident of any of the below countries while working and travelling as a digital nomad, you won’t pay tax while you travel. This, however, would require becoming a resident of that country and may not be the case forever, as increasing numbers of people opt for a remote working lifestyle.

  • Malaysia
  • Dominican Republic
  • Singapore
  • Czech Republic
  • Mexico
  • Vietnam
  • Andorra
  • Belize

Countries with the fastest internet speeds

The most crucial tool in your kit when working as a digital nomad is fast and reliable internet. According to Speedtest.net, the top three countries for mobile and fixed broadband speeds are the UAE, South Korea and Qatar for mobile, while Singapore, South Korea and Hong Kong come out on top for fixed broadband.

Countries with the best quality of life

What you consider a good quality of life will differ from other people. The Quality of Life Index by Numbeo bases it on factors such as safety, purchasing power, health care, cost of living, property price to income ratio, pollution and climate. Based on all of these factors, the top 10 countries for quality of life are the following:

  1. Denmark
  2. Switzerland
  3. Finland
  4. Australia
  5. Netherlands
  6. Austria
  7. Iceland
  8. New Zealand
  9. Germany
  10. Estonia

Five tips for digital nomads

Along with the flexibility and independence of the digital nomad lifestyle, you’ll still have responsibilities, such as liaising with clients and paying your taxes. Here are a few things you can do to make your nomadic working life as streamlined as possible:

Have a rainy day fund

A small but sufficient rainy day fund is essential for the digital nomad. While some may be able to get by paycheck-to-paycheck, you’ll likely want the reassurance that if things go wrong, especially when travelling, you’ll be able to put it right. A rainy day fund is also essential for any dry periods when you might not have much work.

Invest in insurance

As a digital nomad, freelancer or self-employed person, you can get insurance for everything from your precious laptop to unpaid invoices. If you want to remain as protected as possible with security in your career, a good insurance policy is well worth considering.

Manage your finances

If you’re a freelance digital nomad, or if your employer doesn’t pay your tax for you, it’s best to brush up on your income tax knowledge, as well as how to file a tax return to avoid fines or unexpected fees.

Be flexible

Working as a digital nomad can be a logistical challenge. You may end up in different time zones, places with patchy signal or even travelling for long periods. To make remote working work, you’ll need to be comfortable with complete flexibility, have stellar organisational skills and ensure you can manage your time well.

Embrace the learning curve

Like anything else in life that is new, you’re likely to make mistakes and learn valuable lessons. If you can find a positive outcome from each, you’ll be learning as you go.