This article is a natural extension of the concept of making your home environment your preferred workplace. Location independence, including being a “digital nomad”, stems from being able to control the environment that you work in. Here, I’ll cover the differences and advantages / disadvantages to each.

OVERVIEW

Historical precedent

Nomadic groups, and even civilisations, are not new. From the Aborigines of Australia, to the caravans that crisscrossed the Sahara desert, nomadic groups have survived for generations even when the option to settle down was available.

A variation on this theme is the economic refugee, somebody who travelled (sometimes vast distances) in pursuit of opportunity. This is typically how cities were formed, with people gravitating towards job options and / or a greater number of potential customers.

What links these two groups is not being tethered to a specific location, instead going where the work took them. If you distinguish this from agrarian or many hunter-gather groups, being able to position yourself in new places often meant economic survival, if not prosperity.

Once we move beyond economics, the great advantage to moving for a job / work was lifestyle. This could come in the form of preferred weather, greater numbers of people to mix with, entertainment, escape from persecution, and exposure to new ideas.

Tying it together with the modern world

Communication and transport networks have long enabled the ability to service global customers. So long as your customer could find you, it has been possible to conduct trade with them remotely for a very long time. If you were the best, customers would inevitably find you, and you could ship your wares (or expertise) all over. Think of shipping routes, telegrams, postal services, telephones, and faxes. All of this was possible before the Internet came along.

The Internet has turbo-charged these existing practises, as well as enabled the lowering of barriers to entry for so many businesses. It has meant that for the average person, their customer base could immediately be anybody with Internet access, anywhere in the world.

For many types of jobs and businesses, this means that individuals can choose where they live and still get the work done. Becoming a “digital nomad” is essentially choosing where to live, repeatedly! Think of it as a subset of the location independent lifestyle.

ADVANTAGES OF LOCATION INDEPENDENCE

Let’s explore the main reasons that location independence, including being a “digital nomad”, has appeal.

Economics

Once you are free from having to go into an office / shop environment, do you even need to be near your customers? The cost of living in major urban centres, particularly rent, often puts you on a dangerous hamster wheel trying to make enough money just to pay said rent. Thinking more broadly, the cost of living in most Western countries remains high.

Reducing your outgoings (expenses, etc) means more money in your pocket. This extra cash could be used to prioritise other elements of your life that you couldn’t afford. Perhaps you want to eat nice meals more often? Or take trips on a regular basis? Send your kids to a different school? Voluntarily visit the out-of-state in-laws?

A move could take you from a major urban centre, or you could even decide to relocate to another part of the world. Through this move, you are likely to reduce your day-to-day living costs substantially. Not only is rent cheaper, so too is food, utilities, basic services, transport, etc.

Alternatively, you could decide to actually move into a major city. One rationale could be that your increased living expenses are offset by no need for a car.

Weather

Hate the cold, grey Winter months that seem to go on forever? Dislike the hot, humid weather that never changes? Actually miss seasons? The weather has a bigger impact on our mood than many of us realise. This is particularly concerning for those who live in Winter climates with minimal sunshine for chunks of the year.

Perhaps you have a medical condition that has lesser impact on your daily life in certain climates? Conditions including hay fever, asthma, and skin irritations, benefit (or at least improve) from certain temperature and humidity conditions.

Bear in mind, the weather also is indicative of recreational options available. Snow means skiing / snowboard, tropical often means fairly ready access to a beach.

Culture

Fancy learning Spanish, Arabic, or Mandarin? What about perfecting your pasta making technique? Or want to learn more about the customs and history of the Balinese people? Sure, you can take a class, or go on holiday to get a flavour. However, nothing beats immersion.

Being in amongst it gives you the best chances of learning new skills, exposure to ideas, tasting less common dishes, or taking in a show. If you consider the economics alone, once you’re on the ground, your incremental costs are minimal now that travel is no longer in the equation.

There is a big caveat here… If you enter the expat bubble and don’t actually try, your cultural experiences may be as sophisticated as knowing which local beer is best. You’ll still have to make an effort, for sure, however being local reduces the barriers substantially.

Travel

Fancy a weekend in Hong Kong? What about a short break in Barcelona, or Buenos Aires? Hoping to be in Kyoto to catch the best few days of the annual sakura (cherry blossoms)? Everything is possible – for a cost.

One fantastic location strategy is to base yourself near all of the things that you want to see. There is no need to actually live there, just have ready access. Often, the city that you choose to live in doesn’t have to be the most entertaining. It just has to have a good airport or train connection.

Taxes

The topic of tax minimisation for you and / or your company (for the distinction, check out this article) is far too detailed to cover here. A couple of brief points to consider though, as taxes are more than income-related:

• Your personal tax rate is typically dictated by where you live. For example, in the US this includes State and City taxes leveraged some places and not others.
• Sales tax / Value-Added Tax (VAT) / Goods and Services (GST) often vary from place to place. In Europe, if you are ordering online, the taxes are charged based on the delivery address too.
• Various “sin” taxes can mean that alcohol etc can be more expensive in some places.
• The cost of petrol / diesel may vary wildly, which may be of interest if you spend a lot of time driving.

Family / friends

This one may be a little less obvious for some. Being location independent creates opportunity to spend time with family or friends when somebody close is long-term sick. You can care for them and still continue working. This provides help and support for the person in need and makes you feel good that you are able to be there for them in a time of need.

It can also alleviate pressure from other family members or friends that want to help however can’t take time off, or work remotely. It is a win for you and for those around you as well.

Thinking more broadly at more longer-term possibilities, location independence allows a re-think about where you might choose to live. Beyond the economic arguments for moving (see above), factors such as access to good schooling or proximity to parents and / or friends can be very important.

This is particularly true for parents of younger kids. Having access to babysitting options or flexibility with childcare arrangements can free up time and provide peace of mind.

DISADVANTAGES OF LOCATION INDEPENDENCE

Location independence isn’t always beer and skittles. The logistics of making it happen is the biggest challenge, however there are other considerations as well.

Establishing yourself in a new place

Moving is stressful for everybody – humans don’t particularly like change. This is especially true as you increase the number of variables involved, such as jobs, partners, kids, and where you’re moving to. The logistics, planning, and emotional effort of relocation are complex points to be covered in future articles.

Social interaction

A big factor in creating a sense of “home” in any place is to have social interaction that keeps you feeling connected. One of the toughest parts of moving somewhere new is putting yourself out there and meeting new people.

In addition to building a new social network, it can be easy to forget to stay in touch with people from your old place. When the complication of time zones gets thrown into the mix along with busy lives, a more proactive approach is required.

When things go wrong

This is as much about knowing where to go to get things fixed as it is about distance. On the (usually) more innocuous side, finding a plumber, office supplies store, supermarket chain, etc has never been easier.

Getting to grips with opening hours, the idiosyncrasies of banking / post office / government services, alcohol restrictions (if any), public transport, etc are all part of the “fun” of starting in a new place.

There is another downside that is inevitable for being away longer-term – the dreaded phone call. At some point, bad news is going to come your way, be it the loss of a family member, pet, or perhaps less distressing, the closing down of your old favourite bar.

The best strategy to prepare and cope with this is to have a plan in place in advance. Decide if you’ll travel back for funerals (and whose), and have this discussion up-front. Having the money available for flights is important too.

Challenges re-entering the regular working environment

The flexibility that comes with remote work can be quite easy to get used. It can feel very difficult to give up should you return to a regular working environment. The daily rituals of getting dressed in work clothes, the commute, not to mention the water cooler gossip (for those still stuck in the 80s).

This isn’t to say that it’s impossible to go back to an office job. If you already have a set routine and good work habits at home, this is a huge advantage. Be gentle on yourself, including possibly negotiating a phased transition back into the office.

You still have to work

Social media is full of the imagery of remote destinations, with a laptop used as a mere prop to illustrate “remote working”. At the end of the day, you’ll still have clients to serve, bills to pay, and Slack channels to keep on top of.

Similar to the initial phase of working from home, the novelty of location independence does wear off. Experiment with different work schedules and conditions to find what works optimally for you.

WHY BECOME A DIGITAL NOMAD?

The term “digital nomad” often conjures up images of sitting on a beach with a laptop, cocktail sitting on the right. It’s a great fantasy, however the chances of being productive in such a situation are pretty slim. Plus, banana lounge chairs are hardly conducive to using your laptop for an extended period. And those cocktails, they don’t come cheap…

Let’s step through what being a digital nomad means in practice. All of the points about location independence are relevant, as well as the following.

You can follow the seasons

Imagine being able to ski during your lunch break and on weekends during ski season. Followed by months of an early morning swim before retreating inside before it gets too hot. Why not have it all?

Or if you’re somebody who hates the cold, follow the perpetual Summer through being based in tropical climates. Or, move between the hemispheres over the course of the year.

Flexibility in accommodation / location options

Building on what has been said about picking where you want to live and play, you can do this in a more micro way in the same region / country. If a place isn’t working out, move on to the next one. Maybe you want something with huge entertaining areas for a specific time of year. Or a place that looks onto the beach for the two months that you’d contemplate getting into the water.

Social engagement

Now we start moving into some of the more challenging aspects of being a digital nomad. New places with new faces means you’ll be continuously need to be putting yourself out there to make friends. This comes naturally to some, particularly when younger. However it can become an emotional (and potentially, financial) drain over time.

Continuously moving is expensive

If you have ever experienced backpacking, or travelling on a budget, you’ll be familiar with this. The constant “set up” costs, not to mention rent / accommodation deposits, expensive rates for short term stays, it all adds up. Plus, staying in a place for a while gives you a better chance of finding the good cheap eats, and experiencing life for a local. This is usually a lot cheaper (and easier) than for a tourist.

SUMMARY

The events of COVID-19 have shown that a good number of the office-based population in many countries are able to work remotely. Once this barrier (physical and mental) has been overcome for you, it can open up the opportunity to be thinking much more broadly. If you own your own business, or work contract roles, this is even more liberating.

Location independence, and to a lesser extent, digital nomadism, doesn’t mean jetting off to exotic countries. On a more basic level, it allows greater flexibility and choice for you. When considering work-life integration, being location independent can make a huge difference.