Let’s just address the elephant in the room. A lot of us are having so much fun hopping from country to country and experiencing different adventures. Most of us never think about what will happen when/if we get old. I’m all for living in the moment, but there’s no way I want to end up penniless and at the mercy of my country to provide for me.

If you’re a U.S. citizen, there’s no guarantee social security will continue. It’s a scary thought to think about getting old. Will you live in a cardboard box off Khao San Road and be a begpacker at 65 years old? Or do you want to have a comfortable condo or house somewhere and live off your savings?

My plan is to have a condo in Mexico or Belize and live off the interest of my savings in a gated community. Your plan might be different. Regardless of what you want, I can guaran-freaking-tee you –you’re not working towards that now. Don’t worry, you’re forgiven.

In this post, I’ll tell you the steps we should all be making towards retirement even if you[‘re not making a lot of money. Note that I’M NOT A FINANCIAL ADVISOR IN ANY WAY. This information I’ve gathered from friends and from asking the digital nomad community. It is also geared towards U.S. citizens, but I’m sure you can ask about comparable funds in your country.

1. LIVE BELOW YOUR MEANS!!!!! How the heck do you expect to save money if you go out drinking with a bunch of a$$holes every weekend or buy that vintage 1950s coat? It’s impossible. You must reassess your priorities. I’ve taken a full weekend off with no outside contact simply to connect with my creative side and to sort my finances. I’m not saying you can’t go out and party, but make it something you do once every month. Put the rest aside.
2. LIVE BELOW YOUR MEANS!!!!!! This is so important, I must repeat it twice. How much is your rent? Car payment? Insurance? Student Loans? Grocery bill? Social life? The biggest money grabber is rent. Awww, hell…I put off Istanbul because it was clear I’d never be able to save money in that city. My priority right now is paying back a dear friend who loaned me money and saving for my future. This is why I cut my rental costs by 70%.
3. Make sure you have an emergency fund before you even think of saving for retirement. If the total bust of the online teaching industry in China has taught us anything, it’s to be prepared for emergencies. I know everyone says it should be for six months, but I think four months is okay at minimum. It has never taken me longer than a month to find work. Remember to put that money in a high yield interest savings account.
4. Open a Roth IRA BEFORE YOU EVEN THINK OF STEPPING OUTSIDE THE USA. Charles Schwab, Vanguard & Edward Jones will close your Roth IRA accounts if they suspect you’re living outside the USA and have no concrete plans to return. They can even freeze your accounts! Keep this in mind. Also, if you plan on claiming that sweet FEIE (foreign earned income exclusion) on your taxes then you can’t contribute to a Roth IRA unless you make over the allotted earnings amount. As an example, right now, you can claim up to $108,700 with the FEIE. You may contribute whatever extra you earn over this amount to a Roth IRA. -UPDATED SEPTEMBER 25, 2021- The most you can add each year is $6,000 USD. That’s a monthly deposit of $500. If this is too much for you and you’re on a limited income then add what you can each month. Every little bit helps, but more is better. I HIGHLY ADVISE having the money automatically deducted from your account each month. Try to add at least $200 each month. If you can’t even do this then it’s time to reassess where your money is going.
5. So…What if you want to save more each year? Check out index funds and savings bonds. You can find more thorough information on how they work below. I found this video , from the 2019 Nomad Summit, extremely helpful:

Here are some additional resources to help you:

Roth IRAs: The Complete Guide

U.S. Savings Bonds

How Do Savings Bonds Work?

The Ultimate Retirement Savings Guide for Digital Nomads

Compound Annual Growth Rate: What You Should Know

Savings for Retirement When You Have Student Loans

Rules on IRAs for U.S. Citizens Living Abroad –I think H&R Block is too expensive, but as a one-off service to sort your tax mess abroad then it’s worth it. I used them to sort my back taxes while living abroad and have no complaints.

Please share how you’re saving for the future. It would be a big help to all my subscribers to share any tips.

Are you part of the FIRE (financial independence retire early) movement?