Felix Hug

6 Ways To Save Money When You Make Traveling The World Your New 9-To-5

You decided to leave your familiar surroundings in order to travel the world. Your previous lifestyle didn't fit you anymore. Going to the office every day with a crowd of unhappy commuters started to hurt your soul deeply. So, you packed your stuff and left the country.

Now, every new place you visit awakens your senses. Each place has a unique smell in the air. Seeing different faces and diverse ways of living makes you curious about the world again.

You want to continue this traveling lifestyle.

These days, it's not unusual to find perpetual travelers in any foreign country. They either stay in one country for an extended period of time or continue to move among countries with a small luggage bag. The biggest question for all of us is how they continue to fund that lifestyle.

Many perpetual travelers give up the comfort of regular paychecks in exchange for this freedom. It's true that a lot of them already have savings. So, they can afford to travel.

However, it's difficult to rely on savings alone for long-term travel. Many continue freelancing gigs, or find work like teaching English in a foreign country. Some work on their own location-independent online businesses while traveling.

The good news is, if you stay outside the country for more than 330 days a year, you don't have to pay US income tax on your earnings under $101,300 (for 2016). That means, at an average hourly wage of $21.45, a single person who makes $40,000 a year can work about 400 hours less each year as he or she does not have to pay income tax. If you travel mostly to cheaper countries, your living expenses will be much lower than they are in the US.

However, thanks to my experience of traveling full-time, I realized there are certain things I have to watch out for in order to take advantage of the cost-saving benefits of traveling.

1. Think like a local and spend like a local.

In the early days of traveling, I was blown away by how much I could get for a fraction of what I spent in New York City. So, I would get the best apartment I could afford and eat at the best restaurants.

Then, I saw I wasn't saving a lot of money. Other experienced travelers – even the ones who could easily afford it – didn't go crazy seeking luxury.

When you travel full time, you can't spend like a tourist anymore. Why? Because you're not visiting that country or city to go nuts on "tourist attractions" for a few days. You can't go back home and eat cereal for two months.

You'll be working and living in this new country for weeks and months. This makes you a local, and it gives you a chance to experience the local culture in a longer and more meaningful way.

We're used to spending a lot more money in our home country than many locals in other countries have seen. So, things that are targeted to travelers are often more expensive.

Airbnb and even hostels are more expensive than the short-term rentals you can get through local listings. The secret to traveling for a long time is to think of yourself as a local everywhere you go. This isn't a luxurious vacation.

2. Cook your own meals.

In many places, eating out is extremely cheap. Guess what's even cheaper than extremely cheap? Cooking at home.

Buying groceries in a local market and cooking for yourself cannot be beat. Plus, it's healthy.

Home-cooked meals can be more nutritious and keep you healthier when you are on the road for a long period of time. This is crucial for every short or long-term traveler who doesn't want to end up in a foreign hospital.

3. Prioritize what you spend money on.

The shopping category will naturally disappear from your budget. Your priorities change when you leave home. Spending instead on new experiences and safety might be high on your list of priorities now.

You might want to spend more for your business than you do on traveling itself. Everyone has different priorities.

Even though you might want to do a lot of things in a new country, it's best to focus on the couple of things you care the most about. This is easier said than done. There will be so many things you want to do.

4. Protect your belongings.

If you're not already a Type A personality, you will become one very soon after you start traveling. Constantly moving exposes you more to the risk of leaving something behind and never being able to retrieve it.

Losing something on the road means you will not be able to replace it for a long time. From important identification documents to clothing items, anything you lose could cost you a lot of money and time.

Travelers, especially females, are easy targets for thieves and pickpockets. I have personally experienced both of them. As you travel, you will soon develop habits to protect your belongings that you've never had before.

5. Save on travel expenses.

Before I started traveling, I collected bonus miles for many years. So, I never had to pay for my flights or occasional hotel stays. Travel expenses are by far one's biggest expenses on the road.

However, it is far easier to save on this expense than you might think. Collecting miles with everyday credit card purchases is one way to do this. You can also save by using cheaper regional airlines, planning your trips ahead of time and sharing costs with other travelers.

Use non-ATM fee debit cards to get cash in a foreign country. You will quickly realize that exchanging cash in an airport is not the best way to get the local currency. Travelers' favorite way to get cash is to use debit cards that don't charge international ATM fees, and even refund the fee charged by a foreign bank.

Charles Schwab and TD premier checking are two of the more popular ones. These debit cards not only have the best exchange rate, but they also help travelers withdraw cash as needed anywhere in the world.

Consider your travel as an opportunity to educate yourself about the global economy. Traveling through different economic systems allows you to look at the economy in a global sense.

You track constantly changing exchange rates and see how prices change across borders. You meet local people and learn about their financial realities, beyond what the media has been feeding you.

Pay attention to what's happening in the countries you visit. You might decide to participate in the local economy by creating and selling something. You might see this as a chance to make a profit by utilizing your knowledge in different markets. You can also decide to open a foreign bank account, in order to hold non-dollar currencies outside of the US.

Now, your personal finances are globally diversified and empowered to withstand the impacts of the US market. That is what global corporations do, right?

Also, know that if you still have bills to pay, having student loan or credit card debt should not stop you from doing something that will make you happy and fulfilled.  Some people postpone their traveling until they can pay off all their loans and accumulate some savings. Others follow their dreams as soon as possible and don't waste another day.

I understand the thinking behind both. There are ways to manage your bills while you travel, without being irresponsible about them:

a. Set up auto-pay for your bills: It's easy to forget your payment schedule while you're constantly traveling. Set up auto-pay, so that forgetting or not having Internet access in a remote area won't make you miss a payment.

b. Negotiate with your credit card companies: You can negotiate a lower interest rate or monthly payment when you tell credit card companies you're having financial difficulties. They might even stop payments for a period of time. While you travel, you will likely have a reduced income. So, it might be wise to seek lower monthly payments, if you can arrange them without any negative consequences.

c. Refinance your student loans: For me, paying a little more lifetime interest for a longer duration was worth paying a third of my original bill and using the funds for things I care more about.

6. Think of the big picture.

Many questions arise when you leave your home country and face a different world. Why are these people so happy with so much less? Why don't smart kids in these countries have the same opportunities as the kids in my country do? You become aware of new facts of life, and you want to make sense of them.

Some of these questions will occupy your mind more than others. You will want to continue traveling in order to answer those questions. You might even want to do something about them. The travel you started out of curiosity and a desire to escape will start to have reason and purpose.

Keep reminding yourself why you're doing this. You will keep meeting the right people, and have the opportunities you need in order to continue your journey.