How to Become a Digital Nomad Family: Planning Our Gap Year

Many people reading this blog are likely also considering taking their families on the road for an extended period or gap year, and taking a bit of a break from the grind (whatever your grind may be). Many are also trying to figure out how to get started on planning a trip like this, and how to turn their dreams of a gap year or a digital nomad lifestyle into reality.

While it has taken a lot of planning and hard work to set ourselves up to be able to do this, we also acknowledge the immense privilege that has allowed us to get to where we are now.

At present, we are two months into this trip and the experience has been amazing. We are getting to spend more time with our kids, getting more opportunities to do things we want to do (like working on this blog), and just getting more time to enjoy our time on this planet.

Life is short, you only live once, etc. And did we mention that we are skipping winter this year?

But if you’re thinking of taking the plunge, you do need to make sure that you are well-prepared before you embark on a trip like this, especially financially. Here are some general strategies to keep in mind when planning for a gap year adventure.

Start Saving and Building Up Your Investments as Early as Possible

Before we left, we made sure we were well-positioned to put our lives on hold this year to travel. Despite the constant questions from friends and relatives as to why we were not buying into the absurdly expensive property market in our home town of Toronto, especially with both of us being well-paid mid-career professionals with some means, we continued to rent properties that were easily affordable for us instead of buying a house with a massive mortgage.

This has made it easier to save money and build up our investments over the last decade, and has given us the flexibility to leave our hometown behind with nearly zero overhead (aside from the $180 per month storage container where all of our worldly possessions are currently being held) on only sixty days notice to our landlord.

We expect that the passive income from our investments will cover a good portion of the expenses we incur during this year away (contingent on the overall market performance). Combined with Mr. WorldSmith continuing to consult for his previous employer part-time from the road, and Mrs. WorldSmith taking on some freelance consulting work, we do not expect our family net worth to decline significantly (touch wood).

Find Ways to Decrease Your Cost of Living While Travelling

Life in our hometown is so expensive that we do not expect our costs to increase while we are on the road — in fact, the plan is for them to actually go down, when averaged out.

We’re doing our best to keep accommodation costs below what they are back home and are trying to limit our spending while on the road (with mixed success). So while there will be some opportunity cost associated with the dollars we fail to earn this year, our increased costs and higher marginal taxes at home are such that the ultimate impact of this trip may not be overly significant for us.

However, since we are only two months in and still travelling through the more inexpensive countries on our itinerary, we will have to wait and see where we net out in the end. (You can see how well we have done managing our spending so far here.)

Some of the strategies we are using to keep our costs low include doing long stays at Airbnbs that offer large discounts for monthly stays (which typically bring prices down significantly over the cost of hotels), trying to visit a number of countries where the cost of living and staying is lower, eating at home in the more expensive countries instead of relying on restaurants, trying to plan our travel within regions for efficiency, and trying to limit our overall movement as much as possible (because transportation costs for 4 people really add up quickly, even if you’re only going a short distance).

Elements of this planning, like reducing movement and doing longer stays, also have the added benefit of helping us avoid getting worn down by our travels. Our goal is truly for this year to be regenerative, not to wear ourselves out.

Plan for the Worst

Importantly, we have also ensured that we have left enough of a buffer to keep us going after our travels come to an end. Since we had to quit our full-time jobs in order to make this dream a reality, there’s a good chance that it will take us some time to get back up and running wherever we end up once it’s over, and we wanted to make sure that we accounted for this contingency as well.

Making a big leap like this is always a bit of a gamble, but we’re hoping that the work we have done to plan and save for this trip, in conjunction with the strategies we’re using to keep our costs as low as possible, will help to mitigate the risk.

Hope for the best, but plan for the worst, right?

Obviously, everyone will come at their gap year from a different position, and it’s important to tailor your planning to your own unique situation.

But so far, we’ve found that this approach has served us well, and despite a few hiccups along the way, we’re still feeling confident in our situation and our ability to make this gap year a success.