How much do you need to make to afford Remote Year?

Can I afford Remote Year with my current salary? What's the purchasing power of a dollar in all of these countries? What's the average cost of food, etc, in USD? I started running the numbers as soon as I got accepted.

"Who builds purchasing power spreadsheets for a year abroad? You, apparently." - Jenn, our editor at Tortuga.

Yeah, me, apparently.

So the big questions are...

 

1. Can I afford this with my current salary? 

Here's a good benchmark for salary: you need to bring home the cost of the Remote Year fee + approx $1,000 on a monthly basis. That's on the low end. You'll be more comfortable and get to do more things with $1,200.

So, assuming a 25% tax rate, no dipping into savings, and no going into debt, the minimum salary you need to earn is $48,000.

That does NOT include recurring or fixed costs back home. No car insurance, no student loans, nada. 0 costs outside Remote Year. That's just for what you're spending abroad. 

That's cutting it close, every single month. That means staring at double digits in your bank account until payday. Every month.

That's fucking stressful.

I'd say a more comfortable salary to afford Remote Year is $54,000.

Plan accordingly.

Here's my math:

 
 

But where'd I get that $1,000 number?

  1. Extrapolating based off my expenses in Montevideo, and
  2. Data on the Consumer Price Index and Purchasing Power in every city.

Which leads me to...

 

2. What's the cost of living in all of these cities? How far does the dollar go? 

For this, I turned to Numbeo data.

Cost-of-living data is pretty easy to find. But a giant caveat: the numbers I found are not completely reliable and should only be used directionally. 

That's not to say my spreadsheet is useless. Just take it with a grain of salt. 

 

How to edit the spreadsheet

  1. Plug your annual salary into D43. This will show you how much money you'll have left over (or how much you'll be in the hole) in each location. I put in a dummy salary ($60k) so that all of the formulas would show something.
  2. Change the values in line 5 to your city's data to see expenses relative to where you're from. Search for your city here.
  3. Can't find the city? Look up the country.
  4. Do the same for each place you'll visit, if your itinerary varies from mine (which it almost certainly will). 
  5. Google the currency conversion for each country. Plug those values into E 26-37.
  6. Change lines 52 and 58 to your estimated grocery and restaurant expenses.

Notes on the calculations

  • Data as of March 2016. 
  • This spreadsheet doesn't include things like rent / Airbnbs, since rent is covered in the RY fee. Those prices vary as well and rent data can be found on Numbeo.
  • Blue text signifies hardcoded values, black signifies calculations.
  • Orange highlights signify that there was no city-specific data available. I pulled data for the entire country. These lines should therefore be less reliable.
  • Green highlights are the most important pieces, IMHO.
  • Net actual income is income after RY fee and estimated food costs. If you aren't on Remote Year, change column Q to 0 (or use it to account for fixed costs like your mortgage, insurance, whatever).
  • You can play with the spending values in line 52 and 58 to change the food calculations.

Happy budgeting.

PS - if my math is wrong, please tell me in the comments. 


Taylor Coil is traveling the world with Remote Year, living in 12 countries in 12 months, while working as a marketing manager. Follow along to read more philosophies on work, stories from the road, and general (mis)adventures. Sign up for the weekly email, or else read more from the blog.