How to Build Your Remote Work Safety Net
Years ago, when I was working in a traditional office setting, a British national joined our team in the office in Houston. About half a year later, he went to our boss and asked if he could start working remotely from Los Angeles. His reason was twofold: 1) He could live in a house there rent-free that belonged to his family and 2) He didn’t really like Houston. As surprising as it might sound, his “well thought out” plan was denied by the boss and he left the company shortly thereafter.
With working remotely so prevalent in the current environment, the allure of leaving the office to work remotely in another city, or perhaps another part of the world—while still retaining your current position—is a powerful one. But doing so takes much more than simply making sure your laptop charger is packed or your passport is up to date.
Remote work isn’t a vacation, despite the positives it promotes, such as no longer commuting to work nor spending a fortune updating your wardrobe every time you get a promotion.
There are tax ramifications that can trip you up, layers upon layer of competition that you never thought about, and international tripwires to consider if you are moving yourself and your business to another country.
Here’s a look at five pivotal issues you should make yourself aware of before you begin your remote trek.
Start saving … now
You know that $1,000 emergency fund that we’re all supposed to have in case the air conditioning breaks or the car needs an overhaul? That amount barely scratches the surface if you consider the risk you take if you quit your job and move to a new city as a digital nomad.
How much you save will depend on where you’re living and what your intended lifestyle will be.
I recommend stashing enough money to subsist for at least a few months in case the project pipeline dries up or you incur an unforeseen expense while abroad or on the road. Do your homework before moving to understand what your equivalised cost of living will be in your new home. A good place to start is Numbeo, which will show you the relative cost of items in various cities and countries.
Sell your plan, sell yourself
You’re going to have to convince a lot of people that the idea of working remotely is a good one. For some, it will be the obvious choice of getting your partner or family on board, for others, it will be selling the boss on the positives. You not having to commute anymore and spending more time with your kids isn’t exactly going to wow the superior who is doing those exact same things, so you have to frame the request in a way that will benefit the company. Volunteer to be the one on call on weekends and holidays when everyone else is at the beach or be willing to do some recruiting at job fairs. If you know you’re being sought after by other companies, use the remote work possibility as leverage to stay at your current position.
Be diligent about your taxes
With money transferral services like Paypal becoming so prevalent as ways to move funds, sometimes things get a bit hazy about who owes what percentage of their wages to whom. For Americans, there’s the foreign income exclusion with the IRS, which says you can exclude up to $97,600 of your gross income from your U.S. tax return. This applies to American citizens who have lived in another country for a whole tax year, those who are resident aliens of the U.S. while being citizens of a country with which the US has an income tax treaty, or US citizens who have lived in another country for at least 330 days during 12 consecutive months.
If this is your first rodeo, you might want to look into enlisting an accountant to help you sort everything out so there are no surprises down the line. It’s worthwhile cost, and one that you can write off your taxes come April 15.
Make your presence known
You don’t just move to a new town, plug in your Internet cable and start being awarded contract after contract. You have to know how to get work, how to market yourself, how to drive clients toward your business as the solution they need. Finding clients and work might become more difficult while you’re abroad, as you lack the face to face advantage of in-person meetings.
As such, you’ll want to build your pipeline up as much as possible before hitting the road or hopping on that flight. You don’t have to have your entire trip planned out, but you should have some solid work running with some warm leads in the hopper before you take the leap.
Streamline what you can
Packing up your life to become a digital nomad or opting to work remote in a new locale can be a stressful and time-consuming undertaking. Even when you touch down in your new hometown, you’ll undoubtedly need to spend time acclimating and perhaps even practicing a new language!
Using a utility app can help you keep your freelance life in order as you work and explore your new host city. AND CO, for example, allows you to invoice in various currencies (doing the math for you), sync expenses with your bank accounts and track your hours, all right within the app.