The Best Way to Save Money: World Travel

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.

Save money by traveling the world.

Credit:Jason Lengstorf

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:

  1. Rent: $675
  2. Electric: $100
  3. Gas/Water/Sewer: $35
  4. TV/Internet: $125
  5. Renter’s Insurance: $25
  6. 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.

Cheap Prague rental on Airbnb.

This apartment in Prague costs less than $700/month — wifi and utilities included.Credit:Airbnb

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.

Using Skyscanner to determine the cost of flights, and Airbnb to determine the average cost of renting a place for a month, this comes out to an average $1,040/month.

Save about $1,000 by traveling the world.

Over the course of a year, living expenses end up lower when traveling.

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.

  1. Yay! Math!
  2. 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.
  3. Also worth noting are the more than 20 listings under $675/month.
  4. If the cleaning isn’t explicitly covered, you can usually negotiate a small additional fee to add that in before you finalize the stay.
  5. Actually, don’t go to London in January unless you like being cold and damp.
  6. 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.
  7. 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.

Click here to get the free checklist now.