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Small Business and Self-Employed

Accounting & bookkeeping for digital nomads (+Finance Tips)

Digital nomads work beyond the usual constraints of borders and time zones. Armed with nothing but a laptop and an explorer’s spirit, they move around freely, earning money as they go as freelance writers, web developers, bookkeepers, virtual assistants, and much more besides.

While the untethered lifestyle is freeing, digital nomads are still running remote small businesses. 

Like any business owner, digital nomads need to track their finances to ensure they pay taxes, maintain a positive ROI, and achieve business goals.

QuickBooks accounting software can help digital nomads manage their incomings and outgoings independent of their location.  

Digital Nomad Finance: Why It’s so Important

Digital nomad accounting services help remote work, location-independent workers manage their money effectively.

In particular, nomadic workers must pay attention to their cost of living and expenses as they go about their trips. Understanding cash flow, budget, and expected future income is essential to forecasting future growth and knowing whether the digital nomad lifestyle is feasible long-term.

Also, even if digital nomads are moving from country to country, they will need to ensure compliance with any tax regulations, and this may vary depending on personal circumstances. 

For example, wherever they are in the world, US citizens still need to pay taxes in their home country. Nations have differing arrangements when it comes to taxing digital nomads. Keeping track of tax obligations can be challenging if you don’t have a fixed location. A digital nomad tax accountant specializing in such scenarios can help ensure compliance. 

Or, better yet, digital nomads can utilize accounting software to automate some of these processes. 

Save time with QuickBooks

Digital Nomad Accounting with QuickBooks

QuickBooks enables digital nomads to manage their finances effectively from anywhere in the world with its easy-to-use platform. Since QuickBooks is a cloud accounting software, digital nomads can access it with only an internet connection. They don't have to worry about carrying physical copies of their financial records or being tied down to a specific location.

Digital nomads can focus on their core work while QuickBooks invoicing software automates the invoicing process and tracks expenses. Digital nomads, like any business owners, are liable to make errors or discrepancies in their financial record-keeping. QuickBooks eliminates this risk, which is especially important for digital nomads when it comes to tax time.

Digital nomads should consider a QuickBooks 30-day free trial to get a better picture of their finances while traveling.

General Finance Tips for Digital Nomads

Digital nomads often have a lot to juggle while they are working and traveling. From obtaining visas and working out accommodation needs to getting work done and exploring new locations. 

Of course, underpinning the whole lifestyle is the need to manage money effectively. Traveling the world while working is only viable if digital nomads can budget and make enough money to cover costs. 

Here are some financial best practices for digital nomads:

Sell, sell, sell

Before setting out on an adventure, consider selling some possessions. Packing light will be more convenient while traveling, notwithstanding any recommendations for living a minimalist lifestyle. Remote workers can take time to consider what is really valuable and what they would be willing to part with to raise some capital for their travels. Funds from a yard sale could go toward flights, for example.

Ensure an emergency fund

Digital nomads often encounter unexpected expenses, such as medical bills or equipment repairs. Of course, frequently, a nomad’s livelihood depends on their technology, so these repairs are a significant priority. Building an emergency fund to cover these expenses can give peace of mind to quickly deal with anything that arises.

Budget well

QuickBooks can help build a picture, but digital nomads will need to spend considerable time evaluating what is important to them, what expenditures are necessary, where they can save, and what their business goals are.

Answers to these questions will have a profound impact on incomings and outgoings during travels for work.

How much to set aside for food, rent, hotel costs, insurance, and leisure activities? What are the forecasted earnings? What are the estimated travel costs and other variables? 

Remote workers embrace a carefree spirit, but they still need to ground this in financial responsibility to align income with saving goals.

Choose a reliable payment processor 

Digital nomad business owners rely on the ability to receive payments from clients. Choose a payment processor that's reliable, secure, and easy to use. Consider factors such as transaction fees, payment options, mobile app tracking, and customer support.

Get travel Insurance

Nothing ruins an adventure like an accident. Nobody wants to consider this eventuality, but lost luggage, sickness, a car accident, or another unfortunate circumstance can leave digital nomads liable for eye-watering costs while abroad. The most common prepaid expenses are insurance and rent. Consider protecting the trip with insurance to potentially get financial compensation in the event an accident occurs.

Research foreign currency and transaction costs

Digital nomads should take the time to understand if their bank will charge them conversion fees or for taking money out of an ATM. It’s also critical to watch the exchange rates between different currencies. Digital nomads may receive payments in one currency while paying for things in another. It’s important to keep an eye on this because exchange fees and transaction fees can add up, and that’s money that could be saved. 

QuickBooks' online invoicing software simplifies financial management by offering support for 145 currencies, streamlining the process of using foreign currencies as effortlessly as cash.

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