The technical definition of remote work is that it’s a type of flexible working arrangement that allows employees to work from locations outside of a corporate office. Typically, we think of remote working from the perspective of employees at big companies, working from home. This is a common instance of it, but you can also see it in the freelance world too.
The very nature of freelancing means that you are working remotely. You don’t have an office, you don’t have a fixed place to work, and you will move around while doing your job.
It presents many benefits, with the flexibility of remote working being a considerable bonus. A lot of research has gone into the link between remote working and a positive work-life balance, with numerous studies suggesting it provides a much better balance for workers.
While we could go on all day about the possible benefits of working remotely, that’s not the focus of this piece. Instead, as the title alludes to, we’re looking at the idea that remote working can help you save money. Or, well, to put it another way; we want to know IF working remotely offers money-saving opportunities for modern professionals.
Throughout this post, you will see some arguments that help you make sense of things and understand just how beneficial working from home – or anywhere else in the world – can be for your budget!
Many workers will spend 30-60 minutes commuting to work in the morning. They repeat this on the way home, adding up to a lot of time spent in the car, on a train, or on a bus.
In fact, some people will even fly to work, depending on where they live and where the head office is located. This all adds up to some extreme commuting costs throughout the year.
By working remotely, you can slash these commuting costs quite dramatically. You have no need to travel to and from work, or you can choose to go to a much closer coworking space.
For context, a study out of London in the UK found that commuters saved thousands in travel costs over the recent lockdowns. By being forced to work from home, they saved so much money by not getting trains or filling up their cars with petrol.
You might think that, by working from home, you will spend more money on food. After all, you are in the house more often than usual, so you need to buy more food to keep you going throughout the day.
True, but this doesn’t necessarily mean you spend MORE money on food. It is much cheaper to get food from shops that you can keep in your cupboards and fridge than it is to buy lunch while you’re at work.
In essence, when you work remotely, you can make your own lunch using ingredients in your home. You buy a loaf of bread, a packet of ham, some condiments, and they will provide you with a week’s worth of lunches and only one initial cost.
By contrast, if you’re working from an office, you will go to the local shops and spend a fortune on sandwiches and other lunch foods every single day.
Believe it or not, but the average person can spend around $10 per day on lunch – maybe more, maybe less. When you work from home, you can spend significantly less than this every single day on your lunch. In fact, depending on where you shop, you might spend that much on a week’s worth of lunches.
That’s right, remote working can help you reduce your annual tax bill – particularly if you’re a solopreneur or freelancer. You can write so many things off as a business expense when working from home. This includes things like your energy bills, internet usage, and possibly even your home warranty.
Going back to the point about commuting, any traveling you do for work can also be put down as a business expense. It all adds up to some significant savings when it’s time to pay your yearly tax.
Why can you do all of this? Simply put, you are taking money away from your tax bill because all of the things you pay for have a direct impact on your work. Your internet bill is a great example; without it, you can’t work. It’s a necessary expense that helps you conduct your work, so it technically qualifies as a business expense that can be written off.
Of course, please don’t just take my word for it and write loads of things off as tax expenses. Speak to a qualified accountant before you do anything like this, ensuring you abide by the laws. They can help you understand what you can and can’t claim as an expense, and they should also help you reduce your tax costs as much as possible.
This falls under the same category as your food costs in that you don’t appreciate how much money you spend on clothes because of work. Unless you are given a uniform, you are going to need different outfits for every day of the week. It’s a combination of wanting to look professional and stylish, but also being hygienic. It doesn’t look good if you turn up in exactly the same clothes for all five days of the week.
At the very least, you’ll need new shirts for every day, and probably at least a couple of pairs of trousers per week. Factor in any accessories you might wear, and the cost of clothing goes up dramatically. Women are more likely to spend more on work clothing than men, but by working from home you can eliminate this expense.
What’s the benefit of remote working? You can do it in the comfort of your home without worrying about how you look. It’s perfectly okay to lounge around in the same sweatpants and hoody for the entire week, meaning you don’t need to keep spending money on work clothes. It will help you save an absolute fortune over time, and there’s also a bonus knock-on effect that’s relevant here too.
Some of you may be able to guess where this is going, but we’re talking about reducing the cost of washing your clothes as well. Naturally, by wearing fewer clothes every week, you can avoid putting the washing machine on multiple times. Thus, you can reduce your energy costs in this department!
This could’ve been put in the reduced food costs category, but it deserves to be highlighted on its own. There’s no denying that the average worker will spend a small fortune on coffee over the course of their lifetime.
Think about it, what’s the average cost of a cup of coffee where you live? It can change depending on your currency, but it’s typically between $3-$5. This doesn’t seem like a big deal, but factor in how many coffees you buy every day when you go to work.
Part of your daily commute involves picking up a coffee from your local coffee chain, and then you might get another with your lunch. Your office might have a coffee machine that charges money as well, so you could get a cup from there during the day too.
Even if you only buy one per day, you could spend anywhere between $15-$25 per week on coffee, which can easily be reduced if you work from home. You can make your own coffee, which will cost less than that amount per month.
A bag of ground coffee can be less than $15, and it can last over a month if you only have one cup per day. Again, this is such a brilliant example of the small changes that happen when you work remotely, and the impact they have on your budget.
Now, this point revolves around the idea of remote working from a different country to the one you’re based in. You live in the UK or the US, yet you’re struggling to earn a living because it’s so expensive to live where you currently are. Your salary is decent, but the cost of living is too high for you to save as much as you’d like every month.
Well, remote working can help you lower these living expenses by letting you live abroad. You still earn your salary in your native currency, but it’s a lot cheaper to live in a different location. This is known as geographic arbitrage, and it’s becoming highly popular.
Thanks to remote working technology, it’s easy to work for clients in London or New York, yet live on the other side of the world in a much cheaper destination. Thus, you save more money, faster. It lets you save up to buy a house back home or plan for early retirement.
In conclusion, remote working can definitely help you save a lot of money. This is one of the many reasons it’s growing in popularity, and it is something you may want to consider looking into.