According to a 2017 survey by GOBankingRates, more than half of Americans have less than $1,000 in their savings account. Last year, that was me. In 2019, given that I am starting my online business, I will be paying even closer attention to those bank statements. Saving money can be so easy, and even more so is spending it. Staying on a budget while fulfilling and experiencing your life as you want can be a tricky balancing act. By taking small and consistent steps towards your goals you can achieve whatever goal to which you set your mind.
As a traveler and an expat, it is easy to justify my spendings as experiences that are only making me richer. Yes, I have many tales to tell from around the world, and that has made the act of living a grand adventure for me. However, last summer I found myself without a job and a shrinking savings account while obtaining new income sources (hence my online business). Thanks to these 6 strategies I have been able to continue living life abroad as a financially thriving expat.
1. Know your currency.
There is absolutely no excuse to not be aware of your conversion rates if you are traveling abroad. Unless you have an unlimited budget, knowing what you are paying and whether you are getting a good value is crucial to your travels. Read up on living costs before your trip, and get an idea of how much you can be expected to pay for a decent meal and accommodation. A tourist will commonly get ripped off, but a smart traveler knows how to maximize their budget by living like a local.
2. AirBnB discounts.
Speaking of living like a local, did you know that AirBnB can often be cheaper than a private room in a hostel? I do love a good hostel in order to meet other travelers and get good free tours and discounts. However, if you are traveling long-term, having your own place to call home can be a game changer in how you experience a new country. When I moved to Mexico City from Madrid, I stayed in an AirBnB studio for a week. I was in love with the location, but the price per night would have been too expensive to make it my permanent home. After speaking with the owner, she was willing to rent it to me for a year (outside of AirBnB) and we negotiated a fair price according to my salary. AirBnB will also give you significant discounts if you stay for a week or a month.
3. Go to the supermarket once a week.
Meal planning can take you a long way when you are on a tight budget. Last year, as a preschool teacher, I was making $600 USD a month. I was frustrated I could not live the same lifestyle I had in Europe, but I became financially smarter. The only way to ensure my paycheck would last me through the month was to plan my weekly groceries. Rather than eating whatever I wanted in the moment, I went to the supermarket once a week (with a list). Whatever I bought for that week was all the food I would eat during the next 7 days. Always eat before leaving your accommodation. You will be less tempted to go overspend on food. When I traveled to Poland and Czech Republic with one of my best friends, we told ourselves we would only have 1 fancy meal in each city we visited. This kept us from going over budget on many trips around Europe.
4. Do not be afraid to navigate public transport.
If you are sticking to a budget, say goodbye to your Uber driver and hello to that city bus! Riding public transport for the first time can be so intimidating. When I moved to Madrid, I was coming from Fort Lauderdale where there is no metro and buses are random things you may go days without seeing. The independence you will gain as you navigate the city, and the environmental contribution of not using another car pays off. Nowadays, places like Mexico City and Madrid have eco-buses. In Mexico City, public transport is a quarter…I feel richer already.
5. Know your free activities.
Make a list of all the free activities you can do in your city or town. You will be surprised how many opportunities a city can offer to have fun and learn something new at no cost. In Mexico City, for example, aside from your typical green areas, most museums are free on Sundays. Every city tends to have special events and fairs as well. Last month I had some really expensive Italian wine for free at the Italian Culture Center in our neighborhood. There was a free wine, olive oil, and vinegar tasting with presentations by Italians living in Mexico City. It is amazing what sort of low-cost fun you can have around the world if you do a simple internet search.
6. Keep your money in separate envelopes.
This is my favorite thing, whether I am traveling, living that expat life or back home. Keeping my money where I can see it has allowed me to stick to a budget like never before. I have tried keeping track of my spendings by using apps and excel spreadsheets, but none of these tech-savvy methods have been useful as I often forget to keep up with all that data entry. Every month, when money comes into my account, I immediately set some aside in my savings account. Then I withdraw a large amount of cash and divide it accordingly into labeled envelopes: rent, travel, donations, birthday/holiday presents, living expenses. This may sound old-fashioned, but I guarantee this is the one strategy that has made a long-lasting impact on my being able to continue to travel the world full time (4 years and counting!).
What are your money managing strategies to keep your finances on track while also enjoying life?
Also by Vanessa: 3 Healthy Habits I Got From Living In 2 Major Metropolises
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