If you needed to cut your expenses by, say, about a thousand dollars each year, how would you go about it?
Most people start by cutting back on going out to eat, avoiding online shopping, or creating a stringent budget to control expenses.
But it turns out there’s a much easier way to cut your expenses by 10% or more: start traveling the world.
How Living Abroad Is Cheaper than a Lease
To understand why it’s cheaper to live abroad, let’s do some quick math.1
Start by making a list of all the bills you pay that are related to your living arrangement.
As an example, when I lived in Missoula, Montana — which has a pretty low cost of living — my bills looked like this:
- Rent: $675
- Electric: $100
- Gas/Water/Sewer: $35
- TV/Internet: $125
- Renter’s Insurance: $25
- Biweekly Cleaning Service: $1602
So, all things included, I spent $1,120/month to live there.
The Secret of the Shared Economy
When you decide to leave your lease behind and start traveling permanently, something magical happens: all the extra bills go away.
When you search for an apartment in Prague for a month on Airbnb, there are more than 300 results under $1,120/month.
“But wait,” you say, “your rent was only $675 before — isn’t that way more expensive?”
It’s cheaper,3 and here’s why:
When you rent a place through the shared economy, all of the additional costs are included.
Renting an apartment in Prague for $900/month includes electricity, internet, utilities, and sometimes even a regular cleaning.4
So that $900/month means $900/month. Not $900 plus a bunch of extra living costs.
What If I Want to Stay in Manhattan?
Some places are extremely expensive to live. If you want to spend a while in Manhattan, London, Sydney, or other cities with a high cost of living, it can be challenging to find something lower than $1,120/month.
But here’s the thing: it can still be less expensive than your lease.
Taking Advantage of Averages
For argument’s sake, let’s assume the place in London costs $2,000/month. You’re out of pocket an additional $850 for the month over what you would have spent in your lease.
You can make this affordable, though: take advantage of less expensive places to offset costs.
For example, you can spend as little as $300/month for a place to live in Chiang Mai, Thailand — this is a place with wifi, air conditioning, and all the amenities.
If you were to spend half your year in low-cost cities like Chiang Mai and Prague, and the other half in more expensive cities, you might schedule something like this:
- January and February in London.5
- March through May in Prague.
- June and July in Chiang Mai.
- August and September in Barcelona.
- October in Paris.
- November and December in Ho Chi Minh City.
This is a savings of about $1,000 for the year when compared to my costs in Missoula.6
And it’s not just a $1,000 savings.
You’re saving $1,000 by traveling to 6 countries instead of staying in Missoula, Montana.7
You Can Save Tons of Money by Traveling the World
It sounds completely counterintuitive, but it’s true: you can save a ton of money by giving up your lease and renting apartments from sites like Airbnb around the world.
To recap: once you’ve factored in the rest of the costs of living there, a $675/month lease in Montana is more expensive than renting apartments around the world for a year.
This isn’t the result of a complex scheme to save money. It doesn’t even require making sacrifices. I’ve been living quite comfortably in Chiang Mai for a month, and I’ve spent less than a thousand dollars total since I’ve been here.
So remember: the next time you need to save up for a big expense, consider the traveling the world.
- Yay! Math!↩
- I hate cleaning toilets and scrubbing floors, so I build the cost of a biweekly cleaning into my rent. If you haven’t tried this, I can’t recommend it highly enough — especially if you live with someone else.↩
- Also worth noting are the more than 20 listings under $675/month.↩
- If the cleaning isn’t explicitly covered, you can usually negotiate a small additional fee to add that in before you finalize the stay.↩
- Actually, don’t go to London in January unless you like being cold and damp.↩
- The numbers get crazier: someone living in San Francisco, where the median rent is about $3,000, would save about $28,800 each year by traveling the world. That’s fucking nuts.↩
- Montana is wonderful. . .for 3 months each year. The other 9 are something like this.↩
What to do next.
If you’re like me, the idea of traveling permanently while making a living probably seems like a dream — but you don’t think you can pull it off.
I felt that way right up until I actually boarded a flight to leave the United States back in 2014 — and now I can’t believe I didn’t start living this life sooner.
The secret to a life on your terms — work where and when you want, living anywhere in the world — is remote work. And there’s good news: it’s easier than ever before to join the ranks of location-independent workers around the world.
I want to help you. The best remote workers all have a set of non-technical skills, and I’ve put together a free 6-point checklist to help you master them — and ultimately master your time and ability to work anywhere in the world.