Author Archives: money

Leaving on a Jet Plane

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In this post I expand on my comment on Reddit, to this comment:

> If I had one piece of advice for anyone really (really wanting, not
> just dreaming about) wanting to be a DN, it would be: buy a plane ticket!

This is advice for if you want to a digital nomad next week.

If your preference is to increase your odds of having a successful digital nomad experience then I suggest taking longer. Do 3 things:

1) Get experience earning money in a location independent way (you can do that where you live more easily than anywhere else).

2) Save up some money. This item most people will skip but it is helpful. It can be hard for many people to do. And if you don’t want to you can do well without saving much. But you do increase the risks of running into money problems that you could have smoothed over with savings.

3) Travel to where you would like to be a nomad for a trial run. If you want to do it in SE Asia take some time visiting and seeing what it is like. Travel in the way you plan to as a digital nomad. Don’t stay in nice hotels if your digital nomad plan is to live cheaply.

As with all this advice you can ignore the particular advice and learn from even just doing part of it (visiting but staying in much nicer places and being just a tourist will tell you more than never going at all), but doing more will prepare you better (and let you learn if it is what you really want to do).

Some might require extra steps, maybe to earn location independent money you will need to learn a new skill, and maybe need to gain experience etc..

view from my porch (with laptop in forground, plants and another cabin in the photo), Luang Prabang

View from my porch in Luang Prabang, Laos. This was a great place to work (not my average location to work, one of my favorites). I tethered my laptop to my cell phone connection which was fine (you could stream video), it did fail for about 20 hours over 2 days but otherwise was good.

Just leaving on a jet plane tomorrow does work for some people. But I think there are many more people it doesn’t work for than it would work for.

And truthfully many people don’t want to take the time to do a thorough job of the 3 steps I mention. You don’t have to do a thorough job if you don’t want, but it will give you a better chance to succeed and enjoy your experience.

There are also many other sensible things to do first: learn about visa rules, pack well, deal with things like health insurance, deal with mail (family, friend or service) – you often need a physical address at home for some things, find good sources or information on living as a digital nomad, figure out how you will handle banking (it can be a real pain to find an international business bank as a digital nomad), and on and on. You can read about these things on my post here and in some posts on my Curious Cat Travel Destinations blog and many other good blogs.

Related: Financial Independence Retire Early (FIRE) and Location Independent Working – Location Independent Living Can Be In Your Comfort Zone and a Good Experience – Transfer Money Between Currencies Using New Providers Not Banks And Save – My Early Experience as a Digital Nomad: Part Two

Health Insurance Considerations for Digital Nomads

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Health insurance is something that many young healthy people don’t think about. And many digital nomads are young healthy people, though not all of them are. And if you are from most rich countries you may not think about health insurance as your country makes it pretty easy to just be treated if you have health care needs, without a need to have bought health insurance.

But when you are traveling outside your country health insurance is important. I am not very familiar with the details of how health coverage works for all the different countries so you will have to figure it out for your own country. It wouldn’t amaze me if European countries set up some kind of reciprocal care agreements but I have no idea if they do (they should if they don’t).

In the USA we know what a nightmare health insurance is. The ludicrously expensive USA health care plans generally don’t provide any coverage when you are outside the USA (even inside the USA, but not in your own state there are severe limitations). There are many wonderful things about the USA but the health care system is a nightmare and has been for decades.

If you are going to fly off and become a digital nomad one of the critical items to consider (though many don’t give it the attention it needs) is health insurance. It is true that in many countries you can pay out of your own pocket for health care that would bankrupt you if you used the USA health care system and tried to pay out of your own pocket (tens of thousands of people go bankrupt in the USA due to health costs).

If you use good personal financial planning practices you should have at least 6 months of expenses in an emergency fund (and I would strongly suggest at least a year for any digital nomads). That emergency fund should be able to pay for routine medical visits in many countries (Malaysia, Thailand, India, Indonesia, Vietnam, Singapore… – I would imagine this is true in most countries, but certainly not the USA.) without a need for health insurance.

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Companion – Take Your Friends Along on Walks (Virtually) as Security

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This app, Companion – Never Walk Home Alone, lets you share your location with friend(s). They can follow you on a walk home or into an area you are unfamiliar with. I think this is a really nice idea. This is another example of using technology to help us.

It is far from perfect protection, but it is something. The friends you share your trip (walk home, etc.) with can follow your progress and are notified when you reach your destination (I assume when you indicate that to the app).

The only security it provides is that you can know very quickly if they are delayed. Still that is better than nothing and can let you contact local authorities quickly. I imagine it should also provide the police a much better indication that their truly is something worthy of quick investigation if you can show they notified me that they were just walking home, it has now been far too long and they are going away from home and not answering their phone…

Many people worry too much about risks but still risks are real and devising tools that will help people feel more secure and help us react quickly in those rare cases when something bad is happening will be a good thing for society.

Over time, if this app is successful all sorts of features could be added, to automatically provide emergency numbers for the area the person is located in, links to interested non-profits that provide safety resources, pin responses (that have a safe and contact the authorities answer), etc..

There are many uses for this that could be beneficial including for kids and the elderly and anyone at risk of getting lost. I imagine it could even be useful to share with someone you are trying to meet up with (you could both see where you each are). It would be useful if the app let you see both locations on 1 map (but I bet that isn’t an option yet).

Related: Helping Others – Multi-generational Housing Communities – Transfer Money Between Currencies Using New Providers Not Banks And Save

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Peer to Peer Car Rental

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Turo provides peer to peer car rental in the USA. I have rented cars through them before and have found it useful. A big part of the reason I do so is I find the big rental companies pricing so opaque. And if you want something like an SUV the pricing is often very high through car rental companies.

And it isn’t just the pricing that is opaque through the big rental companies, even the rules are crazy. Some seem to block you from renting if you are local (for example, if you didn’t fly into the city) or if you don’t have car insurance (which I don’t because I don’t own a car). It is all just a lousy customer experience to deal with them.

Toyota Rav 4, Skyline Drive, Virginia

My Toyota Rav 4 on a visit to Shenandoah National Park in Virginia.

You can also chose to rent out your car through Turo. It isn’t really ideal for doing while you travel overseas, as someone needs to deal with the car (get people the keys, check it out, clean it up…). But if you had a friend that wanted to pick up some spending money maybe you could leave it with them while you travel.

When I went on my oversea travel adventure I sold my car before I left. And actually I still would as I planned to be gone for years. But, if you were doing something like going to South East Asia for 6 months, you could possible have your car earning money while you were gone.

Eventually there might even be model where you can leave your car with a location that deals with arranging pickups etc.. I think that would be a nice addition to this business. I think it is also a pretty good business for Turo also. One big advantage is they can sell insurance at a huge markup (so make lots of money) and they also get a portion of the rental payment (I think 20% of it).

Related: Should I Sell or Keep My House When I Become a Nomad? – Transfer Money Between Currencies Using New Providers Not Banks And Save – Taxis in Johor Bahru – My Early Experience as a Digital Nomad: Part 2

Economics: Digital Nomads, Visas, Foreign Currency

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This is a slighted edited version of my comment to someone asking about countries that have laws specifically detailing digital nomads are allowed to work on tourist visas. My background is in economics and investing based on economic understanding.

The question of digital nomads working encompasses legal questions (do I need a special visa etc.), regulatory realities (regardless of what the law says how is it enforced at the ground level?) and economics (I am talking here about the benefits to the country economically from having digital nomads).

I like the economic thinking that should drive what the government’s wish to accomplish. The prohibition against work on tourist visas makes sense when work is defined as it was historically (being hired by a company in the country that otherwise would have hired a citizen). So when I am thinking about it I find thinking about the macroeconomic level view and how that is manifest in laws and policy. From a practical standpoint of being a digital nomad what really matters is how that all gets filtered down to the government employees on the ground making decisions.

Few laws say what is legal, they normally say what is not. I would imagine few countries specifically say it is legal to do work from another country (as a digital nomad, as a employee answering an business email on their vacation, as a private investor reading the news and using the internet to buy or sell a stock, as a writer writing a book that will be published back home, an entrepreneur refining ideas to launch a new business back home or whatever).

The laws usually are pretty clear you can’t apply for jobs and get hired by a company inside that country to do work in that country on a tourist visa.

“Thailand” has said it is ok to work as a digital nomad (work for some company outside the country) while on a tourist visa. But these pronouncements by officials don’t carry much weight with other officials so they are not worth much.

What is helpful is knowing the prohibitions against working are primarily about not having foreigners take jobs of the citizens. Digital nomads don’t do that. So they are not meant to be prohibited anymore than the other examples (an executive participating in a conference call from work while on vacation etc.).

But since it isn’t clear cut it can be confused by officials as something not allowed. It is much easier not to have to get low level officials to comprehend the intent of the laws. They think of it as tourists can’t work in the country and that is essentially true. But how “work” is defined is the issue; and digital nomad work doesn’t fit the description of work in that context.

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Financial Independence Retire Early (FIRE) and Location Independent Working

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My plans were similar to the now popular (within a small but committed group of people) Financial Independence Retire Early (FIRE) movement. I was more focused on lifestyle and increasing my financial independence (as apposed to striving for complete financial independence in order to retire very early).

My thoughts were more along the line of being able to avoid a full time job and possibly do some consulting, run my own business (with a lifestyle goal rather than a make millions goal) and have investments that supplement that income. I also wanted to be able to have that possible from wherever I chose to live. Often you are quite limited on where you can live (especially cheaply) if you require a high paying job.

I also understood by living more frugally I gave myself lifestyle options. Living frugally allows you to save money. But it also lets you experience what living on less is like and you know if that is what you want. It is for me. I would much rather have freedom from having to earn a bunch of money to allow me to spend lots of money.

John Hunter with lake and mountains in the background

John Hunter, Bear Hump trail, Glacier Waterton International Peace Park.

I think Financial Independence Retire Early (FIRE) concepts fit very well with a subset of digital nomads. Those focused on FIRE don’t have to be digital nomads (in fact a very small percentage is) and digital nomads don’t have to be concerned with FIRE (in fact, few are). But they are both, at the core, about putting your life first and not letting your life on the 9 to 5 job hamster wheel drive your major life decisions.

Combining FIRE and location independent work provides some valuable benefits. If you have some investments saved up that can be tapped as you travel that can meet some of your living costs, this aids on of the bigger challenges – how to earn money while you travel. And if you travel frugally you can reduce your costs (below what you speed where you used to live).

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Multi-generational Housing Communities

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The digital nomad lifestyle is made possible by the modern world. In some ways it harkens back to nomads but not really very much. Another idea that is gaining favor (not as popular as the digital nomad trend) is multi-generational housing.

Our ancestors all lived in close knit multi-generational communities. Normally with 3 or 4 generations of the same family under the same roof (or within shouting distance in a hut nearby).

I can understand many reasons why many of us moved to our more independent way of living (especially in the USA) as we got rich enough to afford to do so.

There are really interesting (small) efforts to do this in non-related multi-generation households. I think there are very good reasons for it. And for people like me that would rather not live in the same house with these others it can even work in a small group of homes. Often with shared kitchen… Sometimes older people can share some financial burden (young family gets cheaper housing). And younger people can help with yard work, repairs… Cooking can be shared. Childcare from elderly can help free up the kids parents and can give some personal contact to elderly (that can otherwise be socially isolated). Kids can get more contact with people in the small community and may has less time just sitting in front of Netflix (especially small kids).

I learned about the resurgent movement for co-housing while I was living as a nomad. To me it really seems like another form of trying new ways of living that are not the common living arrangement for most people today. It seems to me it has the potential to be as life changing and enriching as many find the nomad lifestyle to be.

Of course there are all the issues you have with people being together. But there are some pretty good things about it too.

Related: Union Corners Cohousing in Madison, Wisconsin – Should I Sell or Keep My House When I Become a Nomad? – Design coalition multifamily housing – Housing Savings by Living as a Nomad

Medical Tourism

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Medical tourism (traveling overseas to get medical care) is growing and likely to continue to do so. The USA’s extremely high costs of medical care push people to find more reasonable health care solutions. Also in some countries the very rich seek out advanced treatments outside their country.

Seeking more cost effective and more customer focused health care options are likely to lead to booming markets in catering to these customers. Many countries have seen this as a smart market to focus on. And I think they are right.

It is a booming market and the USA’s mess of a health care system doesn’t seem to be getting any better and certainly isn’t getting cheaper. In Europe the demand is largely driven by services that have very long waits if done using their national health system. Those that can pay, can pay to have it done where they live, or they can travel and have it done much cheaper.

The jobs provided in countries serving medical tourism are very good. And it brings in a great flow of foreign currency. Singapore, Malaysia, Thailand, Philippines and Mexico are putting forth smart governmental efforts to boost this industry in their countries.

photo of Raffles Hospital in Singapore

Raffles Hospital, Singapore by John. See more of my photos from Singapore.

Most of the time health insurance won’t pay for optional (emergency care while you travel depends on your policy) health care internationally. So most medical tourism is paid for by the person being treated. This is a somewhat silly policy as insurers could save a great deal of money even by only paying say 50% or less of what they would pay locally for those who were willing to travel.

And some insurers are letting people travel for health care (and even giving them incentives to do so). The governments seem willing to pay inflated local prices and so use things like the fear of untrustworthy foreign health care as unsuitable. And then they work with local health industry interests to restrict covered health care options. There is some sense in worrying about abuse but there is also hundred of billions of dollars that countries like the USA could save by letting people seek out health care solutions much more cheaply overseas. Europe could also save a great deal.

Some countries are doing smart things. At the same time Singapore is building up medical tourism for complex medical solutions (drawing people from SE Asia and further away) they are also working to boost the use of Malaysia to provide less complex medical solutions to Singaporeans. As is often the case, Singapore’s government is acting wisely.

Malaysia, Thailand and the Philippines are going after the large market for reasonably priced basic health care. Which is smart for all 3. They are also looking to move up-market (especially Malaysia and Thailand) which is also fine, but there is likely to be great competition and a much smaller market so I would suggest they do so, but do so with caution.

India has potential but has the general problems with infrastructure and a difficult business climate. The potential is huge though. Other countries targeting this market include Brazil, Hungary and Costa Rica.

Related: The Growing Market for International Travel for Medical Care (2013) – Traveling for Health Care (2007) – Finding an International Business Bank as a Digital Nomad

Start-Up Chile – An Innovative Program for Global Entrepreneurs

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I am very impressed with Start-Up Chile. It is a Chilean Government run program that attracts early stage, high-potential entrepreneurs to bootstrap their startups in Chile, using it as a platform to go global. The goal of the program is to position Chile as the leading innovation and entrepreneurial hub of Latin America.

Silicon Valley provides huge benefits to the USA economy. Many countries are envious of this advantage and wish they could gain such economic benefits. But there is a big gulf between wishing and accomplishing. That path requires doing many things right.

Start-Up Chile alone is but a small step in the right direction. But it is a very interesting one. And they have kept it up for several years now. It is amazing how many efforts to create inviting climates for entrepreneurs start with a great flourish as diminish to nothing within 5 years.

Panoramic view of northeastern Santiago

Panoramic view of northeastern Santiago, as seen from the hills of Parque Metropolitano in Providencia. Visible in the background are Apoquindo and Sierra de Ramรณn. via wikimedia

For the current application (open during the month of September) Startup Chile is looking especially for startups in robotics; healthcare and biotech; clean energy; and education.

In my opinion the benefit for entrepreneurs is worthwhile (and especially strong for those in Latin America) but I am even more impressed with the sense the Chilean government is showing for talking concrete steps to boost the entrepreneurship climate in Chile. There are quite a few very good efforts to incubate startups. Few government though are doing much beyond talk. Singapore is another country that is taking fairly smart actions (which isn’t so surprising given Singapore’s long term evidence of smart government).

Many countries understand the benefits of creating a strong climate for entrepreneurs. And given the especially easy location independence of internet based businesses there is a public relations battle for attracting these entrepreneurs (even if most countries don’t seem to have caught onto this reality).

Chile has been getting great publicity from Startup Chile and if they can successfully build on that success they will gain a very nice advantage at very little cost. Like so many startups the Startup Chile program itself has to make sure it builds from the base it has built instead of just fading away.

Related: Finding an International Business Bank as a Digital Nomad – Transfer Money Between Currencies Using New Providers, Not Banks, and Save – Leading Economic Freedom: Hong Kong, Singapore, New Zealand, Switzerland (Chile was ranked 10th in the world) – International Migrants: Economics and Banking

Should I Sell or Keep My House When I Become a Nomad?

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My friend Andrew published a post: So You Want to Travel The World But You Own a House (Or Apartment) which prompted me to add a comment and I figured I would share and expand on that comment here.

Owning rental property can be a wonderful way to help support your nomad, location independent lifestyle. Rental property can provide a source of regular income to supplement your earnings. Of course, getting a rental property into that state is usually something that takes time, or a huge downpayment.

I have found dealing with property management folks to be extremely annoying. First they charge ludicrous amounts (in my opinion), especially for places that have high rents (they normally charge a % of rent + huge amount to rent the place out). These costs greatly reduce the investment appeal of renting out your property. On top of paying them a huge amount they are not very customer focused (to me paying them, or to those seeking to find a place to live).

15 years ago I started renting out my first house and obviously created a web page for it. Nearly none of the expensive professionals did that back then. Only years later they finally were dragged into catching up. And still today, they post not nearly enough useful information.

Still it can be that even with these costs and frustration it makes sense as an investment (especially in the last few years when investment climate is so challenging).

Often the decision to rent out your home (versus selling it when you leave) is impacted by your long range plans. If you want to move back into your house in a year or two or five that limits your options. You may have to accept a bad investment to keep that option open. Especially if you are just going to go give the nomad idea a try for a year, selling may not be wise (unless you don’t want to return to your house even if the nomad idea doesn’t appeal to you once you try it).

photo of a house

Another consideration, even if you don’t care about moving back into the same house, but plan on moving back to the same city, is that if you sell and real estate values climb you could find yourself priced out of the market.

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