Get a job. Travel the world. Pay off student loans.
At first glance, it might seem impossible to pursue all these goals at the same time. How can you travel the world if you have to go into an office every day? And traveling must be financially irresponsible if you’ve got a load of student debt, right?
But according to five digital nomads we spoke with, these pursuits aren’t mutually exclusive. On the contrary, you can learn how to travel with student loans – perhaps even move to another country with education debt – and build a fulfilling career, all at the same time.
So, how did these remote professionals strike a balance between traveling, working and paying off student loans? Here are some strategies they used.
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1. Saving money in a destination with a low cost of living
When Quincy Smith graduated from the College of Charleston with a degree in international business and Spanish, he had one major goal: to travel the world. But with student loan bills to be paid, Quincy knew he had to make a decent income while living abroad.
He found an English teaching position in Asia, but he wanted to be “location independent,” to be able to move between cities and countries whenever he felt like it. To give himself that freedom, Quincy developed his expertise in search engine optimization (SEO) and found freelance clients, making it more feasible for him to leave his job.
“I found two clients before putting in my notice, so I had a bit of a safety net before taking the plunge,” said Quincy. “I bought a one-way ticket to Thailand.”
These days, Quincy oversees SEO on a consulting basis, and he’s set up his own website, ESL Authority. His unconventional career path has allowed him to live all over the world, in countries like Thailand, China, Japan, Colombia, Mexico, Peru and the Philippines.
Since he gravitates toward destinations with a low cost of living, living abroad has helped Quincy pay off his debt faster with extra payments.
“[I have a] lower cost of living mostly due to cheaper housing and not having a car,” said Quincy. “Insurance is cheaper than in the U.S., too.”
Not only has he been able to repay his debt more quickly, but Quincy has also been able to reach other financial goals.
“Being a digital nomad has helped me have more money to pay down my loan and invest,” he said. “[This is] directly related to the cheaper cost of living.”
Because he keeps costs low, Quincy can put his income toward paying off debt and investing for the future.
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2. Making extra payments to speed up repayment
Like Quincy, digital nomad Robert Schrader enjoys the financial benefits of living in a place with a low cost of living — Bangkok, Thailand.
“The cost of literally everything I need is lower here, from housing, to transportation, to healthcare,” said Robert. “It’s even cheaper to travel since Bangkok is one of the world’s most connected air hubs. Overall, I save around $1,000 per month compared to what I was paying in the states, and that’s living in a significantly nicer place, too.”
With his extra money — which he earns through his websites Leave Your Daily Hell and Japan Starts Here — Robert throws extra payments at his student loans.
“[I] have started paying more aggressively,” he said. “My monthly payment is $320, but I increased that [voluntarily] to $420 in 2018. This month I paid $500, which I hope to do throughout 2019.”
Although Robert is eager to conquer his student debt now, he didn’t always take this approach. For a couple of years after college, he deferred his student loan payments, a decision he now regrets due to the extra interest that accumulated.
“[Don’t] go into deferment or forbearance unless it’s actually life or death,” advised Robert. “My deferment, looking back, was mostly for convenience, and it’s a decision I’m paying for now.”
Fortunately, Robert is using his digital nomad lifestyle to make up for his past financial mistakes.
“Now that I’ve been living abroad two years and am starting to see the fruits of that in my bank account balance in a big way. … I’m hoping to leverage living abroad to eliminate my loans within the next five years or less,” he said.
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3. Crushing the remaining balance with one lump-sum payment
As founder of TheAdvisorCoach.com, a marketing consultancy that works with financial advisors, James Pollard is able to live anywhere he wants. His favorite destination has been Cancún, Mexico, but he’s also enjoying living around the U.S., most recently in Nashville, Memphis and Clearwater Beach, Florida.
“The lifestyle appealed to me, plus I had been following some people online making money as digital nomads,” said James. “I ended up following them and did the same.”
He said the $19,000 he owed in student loans didn’t hinder his mobility since repayment was completely automated. For the first few years, he stuck to the standard repayment plan of 10 years with fixed monthly payments.
As his business grew, James kept socking money away into his savings — that is, until one day he realized he wanted to get rid of his student loans once and for all.
“One day I just woke up and said, ‘I want to get rid of this debt,’” said James. “I just wanted to experience the thrill of seeing the debt at zero, so I just transferred the money over and paid it off in full.”
Since he worked with financial advisors, James knew that investing his savings might be a savvier choice than paying off his low-interest student loans. But he didn’t want debt hanging over his head anymore, so he made the bold choice to pay off his balance in full, with one lump-sum payment.
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4. Lowering payments through income-based repayment
Becoming a digital nomad doesn’t necessarily mean you’ll slash your expenses and make significantly more money. For some digital nomads, the freedom to work wherever you want means your income could go down, at least temporarily.
After working as an acupuncturist, Kate Downes decided to become a health writer and content consultant so she could hit the road full time. But her bank account didn’t benefit from this decision right away.
“My income is much less than it was when I was actively practicing, but thankfully it is growing, and I am much happier in my work,” said Kate, who plans to live in Cancún, Mexico, Edinburgh, Scotland, and Amman, Jordan, in the coming year.
To stay up with student loan payments, Kate put her loans on an income-driven repayment plan. Income-driven plans such as REPAYE and IBR adjust your monthly payments based on your disposable income so your bills won’t become too burdensome.
For Kate, an income-driven plan was a lifesaver since she owed $150,000 between her undergraduate and graduate degrees.
“While I have not made major advances in my debt pay-off this year, I was able to live with very low expenses and keep current with all my loan payments while I built my new business,” Kate said.
If she could do it all again, Kate says she would spend more time growing her business before heading off across the globe.
“Had I spent more time planning and developing my digital business in the year prior to taking on the nomad lifestyle, not only would I have been able to make and save more money, but I would have avoided a lot of stress, anxiety and financial worries,” Kate said.
That said, she encourages other aspiring digital nomads not to allow debt to stop them from pursuing their dreams of living abroad.
“Don’t let your student loan debt hold you back!” she said. “Traveling is one of life’s best teachers, and I would not be the same person I am today if I hadn’t jumped on this opportunity. Give it a try and see what magic happens!”
Image Credit: Vladimir Vladimirov.
5. Following a budget to track monthly cash flow
As co-founder and a travel blogger at The Savvy Backpacker, James Feess splits much of his time between Europe and New York City. Since his travel expenses can add up, he’s careful to track them along with his income.
“The main costs are transportation and accommodation,” said James. “I’m always on the lookout for cheap flight deals. …These days, money is a major consideration when it comes to choosing where to travel.”
Part of the reason James must be so budget-conscious is that he and his wife owe about $65,000 in student loans for their undergraduate and graduate degrees. They’ve stuck with the standard 10-year plan for repayment but occasionally make extra payments when their budget allows.
His advice for aspiring digital nomads with student loan debt?
“Live within your budget and try to aggressively pay off those loans,” he said.
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Traveling the world with student loans: More tips and ways to do it
Can you travel with student loans, abroad or stateside? Absolutely. But your loans aren’t going to go away on their own, so you’ll need strategies for managing them from wherever you are in the world.
Some of the most useful include:
- Set up autopay on your accounts so you never miss a payment.
- Find out if you need to transfer money from an international account to your U.S. bank account. Take into consideration any fees or delays associated with the transaction.
- Find the right repayment plan for your student loans, whether that’s the standard plan or an income-driven plan.
- Consider a refinance for your student loans to simplify repayment and snag a lower interest rate.
- Track your monthly budget so you have a clear sense of where your money is going.
- Consider a destination with a low cost of living. By lowering your expenses, you might have more room in your budget to make extra payments on your loans and pay off debt ahead of schedule.
And if digital entrepreneurship isn’t for you, look into various work programs that make travel with student loans more feasible.
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Popular work program options
- Your public service work could take you anywhere in the U.S. and net more than $6,000 toward your federal education debt.
- Join AmeriCorps to Help Repay Your Student Loans
- The financial award of Peace Corps volunteering ($10,000 pretax, at the end of your service) likely won’t end your debt anytime soon, but serving could help you limit your expenses and manage your loans in the interim.
- 6 Ways to Manage Your Student Loans in the Peace Corps
- Joining the Peace Corps to Get Your Student Loans Forgiven? Read This First
- Teaching English abroad — particularly in countries with a low cost of living — could help you keep expenses low and make extra payments toward student loans.
- How to Pay Off Your Student Loans by Teaching English Abroad
- How One Woman Paid Off $40,000 in Student Loans Teaching Overseas
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Although the digital nomad path comes with challenges, it could allow you to build a fulfilling career while exploring the globe. And by taking a proactive approach to your personal finances, you can conquer your student debt at the same time, too.
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