Kathleen Di Paolo is the founder and CEO of Wanderers Wealth. Her goal is to empower digital nomads, entrepreneurs and all other wanderers of the world with global financial freedom. She is an expert in international tax issues, international corporate structuring and global residency matters.

In this interview we discuss how Kathleen came to be an international tax expert, tax strategies for digital nomads and entrepreneurs, considerations for remote workers who want to work from abroad, how companies can reduce (or eliminate!) their tax liabilities, Kathleen’s personal journey as a digital nomad and lifelong traveler, and advice for aspiring digital nomads and remote workers. 

See Also: 3 Ways Aspiring Digital Nomads Can Earn Money and Save Tax

Other amazing interviews to check out:
Running a Remote Real Estate Business with Matt Bowles, Maverick Investor Group
How Beth Santos (CEO of Wanderful) is Changing the Travel Industry and Women in Travel
The Business of Being a Virtual Assistant, with Hannah Dixon 

Jump right into my Awesome Interview Series videos on YouTube here – and please give it a thumbs up, leave comments and subscribe!

Meet Kathleen Di Paolo, of Wanderers Wealth

Kathleen’s career started in international relations and diplomacy, and her desire to help people led her to become a lawyer. In her legal career, she became an expert on different tax systems internationally. 

But eventually (not unlike myself back in 2006), her desire to travel the world extensively trumped her career, and she quit her job to travel. 

While she was traveling, she met many digital nomads who were running their businesses from their laptops. In speaking with them, she realized they had no idea what to do with their taxes, and as soon as they learned of her international tax expertise, everybody wanted a piece of her. Her personal curiosity led her to learn more about various tax residencies and opportunities for digital nomads, and she soon realized she could start charging for her knowledge and advice. And so was born her own location independent business: Wanderers Wealth. 

Her services include one-on-one consulting, online courses, and more.
Check out Kathleen’s FREE Tax Residency Webinar
And her mini course on Low Tax Business Setup
Or her Global Tax Strategy Design Course

Watch our Chat! 

Have a gander at our conversation below, or by clicking this link to watch on YouTube. 

Digital Nomad Tax Planning

Kathleen and I discuss various opportunities and ideas surrounding digital nomad tax planning, including: 

• What you need to know before you start strategizing tax relationships with other countries.
• The importance of making the most of current tax breaks and opportunities for digital nomads and remote workers right now.
• Some loopholes of the past for digital nomads in terms of visas and how that’s changing.
• 10-year tax exemption scheme in Portugal.
• The advent of digital nomad visas in countries like Croatia.
• Whether or not you need to continue to pay tax in your home country while living and working abroad (even with a special tax-free digital nomad visa).
• In some cases you can structure things so you don’t have to pay tax at home or abroad! But there are many different factors involved. 
• Disadvantages to not having tax residency in any country (and yes, there can be some disadvantages!).
• What happens if you sever your tax residency with your home country but later decide to return home and re-establish tax residency.
• The danger of returning home for too long if you have severed tax residency.

See also: Digital Nomad Taxes – Everything You Need to Know

Digital Nomad Taxes: Tax Planning Considerations for Remote Workers

Remote workers (as in people who continue to work abroad for an employer with a standard employment agreement) have some different tax considerations. I peppered Kathleen with questions and we discuss: 

• The first thing to consider as a remote worker considering working from abroad.
• Should you tell your employer you’re going abroad? 
• In some cases if a remote worker establishes tax residency in another country where the company isn’t located (or where a tax treaty doesn’t exist between countries), this can trigger a tax obligation on the part of the company.

See also: Tax Consequences of Remote Work Visas

What Wanderers Wealth Does

Kathleen works with remote companies, digital nomads, and remote employees to optimize their tax situation based on their lifestyle and location. We discussed: 

• How Kathleen designs clients’ tax strategies around their lifestyle.
• How she helps employers and businesses determine the tax consequences of allowing their employees to work remotely.
• How companies can hire and streamline their practices to reduce their tax liabilities.
• Working with Kathleen also means having access to her large network of accountants and lawyers around the world.

Her services include one-on-one consulting, online courses, and more.
Check out Kathleen’s FREE Tax Residency Webinar
And her mini course on Low Tax Business Setup
Or her Global Tax Strategy Design Course

Kathleen’s Personal Digital Nomad Lifestyle and Remote Work Habits

I love discovering what inspires people to hit the road, and then what keeps them on the road and how their lifestyle evolves. Here’s what I discovered about Kathleen: 

• Her pace of travel pre-pandemic (hint: it was ridiculously fast!), and then how it changed during the pandemic.
• Her sweet spot for how long she likes to stay at a destination.
• How she achieves a healthy work-life balance while traveling full-time.
• The challenges of doing consulting work while traveling and changing time zones.
• Kathleen’s vision for the future of her digital nomad lifestyle.
• The advantages of having a few familiar places to return to periodically.
• Why Kathleen enjoys co-working and co-living spaces.
• The beauty of traveling with other digital nomads who understand remote work habits and the “daily grind” of working while traveling.
• Traveling and living with digital nomads, and whether it comes at the expense of having a culturally immersive and “local” experience.
  
  

Advice for Aspiring Digital Nomads

I’m so glad I asked Kathleen about her advice for digital nomads and remote workers, because she touched on some really important things, like: 

• Why Kathleen believes just going for it is the best advice for aspiring digital nomads.
• How experience and collaborations on the road can lead to new career ideas and streams of income (as it did for her).
• The importance of planning your career and lifestyle, but not so intricately that it comes at the expense of seizing new opportunities.
• Her thoughts on travel budgeting and how much money one should save up for a travel lifestyle.
• Why money stress on the road is 10 times harder than money stress at home. (Nora’s Note: Amen; money stress was a big factor in my first breakup on the road).

This post Can You Pay $0 in Digital Nomad Taxes? Let’s Ask Kathleen Di Paolo, Wanderers Wealth appeared first on The Professional Hobo. Please click through to read it in full!

Having a remote job may seem like it flies in the face of conventions like financial planning, but the reality is quite the opposite: without a financial plan, your ability to be a digital nomad and to financially sustain the lifestyle will be highly compromised. 

As a former financial planner, the first question I asked my clients was not about money or the return on their investments. It was about what they wanted to do with their lives. I contended (and continue to believe) that the first and most crucial part of financial planning is about engineering your finances to help you live the life of your dreams. If you want to become a digital nomad, this is the kind of advice I might give you. 

But what follows below isn’t my advice. I enlisted Ellie Lott, who has been a digital nomad since 2017. With a previous career in financial planning (like me!), she initially funded her digital nomad lifestyle with content writing (also like me!), and now she combines her writing skills with her financial expertise to educate millennials about financial planning and making smart financial decisions on her website Young and the Invested. 

If you’re thinking about becoming a digital nomad sometime in the future or planning to launch a business online a few days or weeks from now, the advice that Ellie Lot has shared with me, who has been a digital nomad ever since 2017, was very helpful and I thought I’d share with you all.

Below is a step by step approach to creating a financial plan to become a digital nomad, as written by Ellie Lott. 

___________

How to Plan Finances As A Digital Nomad

When your livelihood means that you spend full time on the road, whether you’re a freelancer, independent contractor, or entrepreneur who has built a company online, whether that be service-based or product based, there are some major things that you need to contemplate financially before you make the jump to commit fully.

The thought of trading your office cubicle to work remotely from sandy beaches is enticing. But, beyond the obvious perks, the digital nomad lifestyle is attractive to many because it provides a feeling of independence. If you’re thinking of exploring this lifestyle, you’ll be joining over 10 million Americans who agree.

However, you may need to get your finances in order first to sustain this lifestyle long-term. If you’re wondering how much you’ll need or if you’ll ever have enough to start, fret not. You can learn from my personal experience how to manage your finances to become a digital nomad.

See Also: How to Create a Long-Term Travel Budget (and the real meaning of financially sustainable travel)

What it Means to Be a Digital Nomad

Digital nomads work remotely, typically as freelancers or entrepreneurs, while they travel the world visiting different places for weeks or months at a time. Contrary to popular belief, not just website designers, creatives, and marketers can become digital nomads; anybody who works remotely can travel and live this way.

How To Budget As A Digital Nomad

As we all know, having a budget is very crucial as we live with our means daily, but it is even more vital when you’re a digital nomad. Mainly if your travel costs take up a huge lump of your expenses or if your income is nonuniform.

There are a few things that you need to remember especially if you work remotely. If you’re a freelancer or run a business online, your income varies from month to month. Some days will be higher than others and sometimes it’ll be a slow business day or month in this situation.

What you can do is to look at your lowest income month during the previous year and use it as a criterion for your budget. By doing so, you can plan your budget accordingly so you don’t run the possibility of falling short..

Saving should be the prime concern of your budget. If your earnings exceed your budget projections for the month, save the difference into an emergency fund. This  will help you  pay for bigger expenses and unexpected emergencies. .

Now that I’m on my way to becoming a seasoned digital nomad, I feel better about my finances and career than I ever did in my previous job because of keeping my budget in check. Here’s why:

I control my income

I have multiple streams of income

It gives me freedom

I acquire new experiences along the way

Financial Steps to Become A Digital Nomad

If you already have a lot of savings in your checking account and a good score on your credit cards, then you’re primed to begin your digital nomad life. 

Maybe you’re pondering how much money you will need to start, and thinking about the pros and cons of starting a nomad lifestyle. The ability  to work online on social media, marketing, web design, etc., can give you  the privilege to go wherever you  want.

Starting this lifestyle can be a bit hard, but it is possible as long as you put your heart into it. Here’s what I learned about creating a financial plan to become a digital nomad:

Save Ahead of Time

As a globetrotter, you’ll need to pay for transportation, food, and lodging from the get-go, so it’s crucial to cushion your savings ahead of time. This can be achieved through a dedicated travel savings account. It helps you understand how much money you have at hand to fund your travel and how much you’ll need to meet your goal. 

The exact amount you’ll want to save largely depends on your destination and employment situation. In my case, I always had enough in my account for a last-minute flight home. However, experts recommend saving at least six months’ worth of living expenses before you leave.

Diversify Your Income

Many digital nomads are freelancers, gig workers, and entrepreneurs. It helps to have multiple sources of income, as this gives you more security, especially as a newbie. Getting gigs lined up several months before you leave allows you to get used to the change of pace. 

Nora’s Note: Indeed, I usually advise people to have the foundations of their digital nomad career established before taking to the road, since the learning curve to the travel lifestyle can be quite steep. Check out my Travel Lifestyle Guides to get a leg up on these challenges. 

I have fond memories of how excited I was when I got my first check ($100) from Google AdSense and multiple affiliate programs that I’m part of. Renting out your current property or investing in stocks are other options worth exploring. If you chose the latter, do some research into the best stock picking service before you start. Remember to be cautious as it’s risky and is more suitable as a long-term strategy.

NOT SURE WHERE TO START IN CREATING A REMOTE INCOME?
Virtual Excellence Academy – for freelancers and VAs
5-Day VA Challenge
How to Find a Remote Job

Create a Budget

Having a budget as a digital nomad is pivotal since it helps you plan your expenses so that you don’t risk overspending.

There are two basic elements to creating a budget: what you earn and what you spend. First, you’ll need to estimate your monthly income. As a freelancer or entrepreneur, your income may fluctuate. You can calculate your average income for the last 12 months and work with this. 

From there, deduct your living expenses. To do this, you can create three lists:

Expenses before leaving home

Monthly expenses 

Emergency money

Add in your retirement income and savings to your expenses, and you’ll find just how much you’re going to spend in a month.

Exact figures are difficult to determine, as expenses and income are highly dependent on your location’s cost of living and your revenue stream. I found that although living in Southeast Asia saved me money, there were more opportunities to network with clients in New York City. Therefore, it’s up to you to find the balance that works for you.

SEE ALSO:
Template for Creating a Long-Term Travel Budget

Figure Out Your Tax Situation

A lingering issue that remains for many would-be digital nomads is the complexity of the U.S. tax code. Especially if you are a remote worker for an employer, there may be tax implications to working on the road. 

U.S. citizens need to know that regardless of location, income earned abroad is still taxable. However, the foreign earned income exclusion (FEIE) allows eligible taxpayers who are living and working abroad to exclude part of their income, up to certain limits. There are also tax treaties available between some countries. 

SEE ALSO:
Filing Taxes for Digital Nomads: Everything You Need to Know
Tax Consequences of Remote Work Visas
Low Tax Business Setup for Location Independent Business Owners

Think About Your Banking Needs

When you’re traveling, you need a bank account that goes the distance. Believe me when I tell you foreign transactions and ATM withdrawal fees can seriously add up. Switching to a travel-friendly bank account can provide financial peace of mind and save you big bucks.

Fully digital banking solutions offer more flexibility and offer lower exchange fees. Charles Schwab, HSBC, Revolut, and Wise are some top players in the international banking sector.

SEE ALSO:
How I Saved Over $2,000 Year in Banking Fees by Using Wise
The Ultimate Guide to Traveling With Money, With ATM & Banking Tips
Don’t Forget About Insurance! An Unexpected Emergency Can Derail Your Financial Plan and Lifestyle

A Few Tips to Help You Save Money as a Globetrotter

• Don’t travel like a tourist. Choose the activities you want to do at your destination, and spread them out over your stay. Take note of free walking tours and free museum days to make your money go further. 
• Avoid eating take-out. If you have a kitchen in your place, opt to cook homemade meals instead. Your wallet will thank you at the end of the day.
• Eat where the locals do. . Look for restaurants or small cafes that will help you save money while still giving you the true experience of the place.
• Pay attention to the exchange rate, which varies in different places. It can be too easy to overspend because you didn’t calculate the exchange rate properly. 
• Most importantly, choose accommodation that fits  your budget perfectly. Remember, you will be staying for a couple of weeks or months so finding a longer-term rental  will help you a lot.

When creating a financial plan to become a digital nomad, there isn’t a blueprint for everyone to follow. Although it may seem daunting, things like getting travel insurance, making sure your taxes are in check, and taking time to manage your money well are definitely worth the effort. It can help you sustain your new lifestyle and check more countries off your bucket list.

Thank you Ellie, for providing this financial template for becoming a digital nomad! 

This post How To Create A Financial Plan To Become A Digital Nomad appeared first on The Professional Hobo. Please click through to read it in full!

You may recognize Matt and Karla Bailey from an earlier article and video interview, which you can check out here! 

This post Financial Case Study: Karla and Matthew Bailey, Videographers (and More) appeared first on The Professional Hobo. Please click through to read it in full!

Without the right insurance, the wrong emergency  can turn your entire trip into an exceedingly expensive and disappointing experience. Long stay travel insurance will ensure that you return home without any problems.

The entire travel insurance industry was shaken up by the pandemic, and although we are all finding our feet again, finding the best travel insurance in 2025 for a long-term trip is no longer as clear-cut as it once was. You require flexibility, affordability, and of course, travel insurance that covers COVID and other pandemics.

Links in this post are affiliate links, which means I will receive a commission if you click through and end up making a purchase. Having endured travel insurance emergencies myself, I know the pitfalls, and I am writing this article to help readers find the best solutions and navigate the murky waters of world nomads insurance. 

Looking for The Best Travel Insurance Companies

Finding  the best travel insurance coverage means using a travel insurance company that will make your trip abroad a smooth one. Aside from the main things like medical and health insurance that will greatly benefit you if you encounter any illness or injuries, simple things such as lost luggage or cancellations and interruptions are important to consider too.

What Long-Term Travelers Need in a Travel Medical Insurance Plan

Long-time digital nomads are well familiar with the unfortunate limitations of the international travel insurance industry due to their unique requirements. Here are a few criteria to keep in mind when getting a travel insurance plan: 

Ability to Apply / Renew From Anywhere

Most travel insurance companies will only allow you to apply for a policy whilst in your home country. This is completely impractical for a digital nomad or remote worker traveling long term. 

Long Term Policies 

Most travel insurance policies expire after a certain period (somewhere between six months and one year) after which you can’t extend or renew.
 

Home Country Coverage for Visits Home

With most policies, you won’t have any coverage if something happens while you’re visiting your home country. And if you’re a long-term traveler, your provincial/national medical coverage may also have expired. (Canadians are familiar with this; once you are absent from your province for a certain amount of time – usually around six months – you have no medical coverage). 

Travel Insurance Coronavirus Coverage

Does travel insurance cover coronavirus? Of the very few insurance companies left out there that satisfy the criteria above, many still don’t cover claims related to COVID – or if they do, their fine print is so ambiguous it gives them enough leeway to deny claims as they see fit. And even if they cover a medical claim on the contraction of COVID or any other pandemic illness, they may not cover a mandated quarantine and related expenses.

Where Do I Get Travel Medical Insurance

This leads me to SafetyWing: an insurance company developed by nomads, for nomads.

SafetyWing offers two insurance products specially designed for remote workers and travelers (plus one specifically for remote companies). It’s one of the top travel insurers for nomads that offers legitimate medical plans and insurance.

Here are a few features offered within the full suite of SafetyWing products: 

• Visits home are covered. You’ll have coverage for visits to your home country of up to 30 days for every three months (for U.S. citizens it’s 15 days).
• You can purchase and renew from abroad.
• They will cover claims related to COVID-19; it works the same as for any other illness. 
  
  

Nomad Insurance has two plans: Essential and Complete. 

The Essential plan is suited for the mid to short term traveller, covering travel risk and unexpected medical issues, starting at $56 USD / 4 weeks. 

The Complete plan is designed for the long-term nomad, with both health and travel upgrades for truly comprehensive coverage. This plan includes routine check ups, mental health care, maternity and more starting at $150 USD / month.

Let’s look at each in more detail.

SafetyWing Nomad Insurance Essential: International Travel Medical Insurance for Short-Term Nomads and Travelers

SafetyWing Nomad Insurance Essential is an international travel medical insurance policy. This means it is intended to help you pay for unexpected medical problems and accidents while abroad. You may want to reference this article on what travel insurance is, which includes a glossary of insurance terms. 

The essential policy is ideal for short-term nomads or travelers prioritizing emergency medical coverage while abroad.

Nomad Travel Insurance policies include coverage for: 

• $250,000 max limit
• Doctors (specific visits, not routine checkups)
• Hospitals and ambulances
• Emergency medical evacuation
• Emergency dental
• Physical therapy and chiropractic (as prescribed by a physician)
• Trip interruption
• Travel delay
• Lost checked luggage
• Emergency response and natural disasters
• Personal liability
• AD&D (Accidental Death & Dismemberment)

Click here to get your instant quote for Nomad Essential!

Nomad Insurance Essential: PROS

Prices are super-competitive, starting at $56/four weeks for people aged 18-39…as long as you select coverage that excludes the United States (including the United States almost doubles the price). 

For trips of unknown or long-term duration, you pay monthly and the insurance automatically renews each month until you cancel. So if you’re trying out long-term travel but don’t know how long you’ll be gone for, this is perfect! If you already know your travel dates, you can enter them in and pay for the entire policy up front. 

Once your policy hits one year, you can apply again for a new policy, and there’s no limit to the number of times you re-apply (up to the age of 69). 

There’s no deductible!

You can apply for and renew the policy from anywhere in the world. 

While the policy has a “pre-existing clause” (which excludes coverage for any condition which existed in the two years prior to applying), they DO have an “acute onset” clause that covers pre-existing conditions that unexpectedly flare up without warning, are of short duration, and require urgent care within 24 hours. 

Children 10 years and younger are included at no extra cost (1 child per adult, 2 per family). 

In addition to COVID medical coverage, Nomad Insurance Essential covers quarantine expenses of $50/day for up to 10 days (provided you’ve had coverage for a minimum of 28 days, you’re outside of your home country, and the quarantine has been mandated by a physician or governmental authority because you tested positive for COVID-19 or had symptoms and are awaiting test results).

Nomad Insurance Essential: CONS 

While a $250,000 maximum coverage limit is reasonable in most countries, it won’t go as far in the U.S. And paying double the premiums for these low maximum bites.

Great news: If you are a U.S. citizen and get a policy that excludes U.S. coverage, you still qualify for coverage on visits home! (15 days every three months). 

Because you need to reapply for a new policy every 365 days, that means the pre-existing clause resets every year (meaning you will not have coverage for any pre-existing conditions that predate the new policy by two years). With most long-term nomads’ travel insurance policies, you only need to endure this clause once. While I’ve listed this as a “con”, it’s a double-edged sword; many long-term medical travel insurance policies require you to undergo a medical questionnaire, which requires you to disclose all medical conditions you’ve suffered at any time in your life. Quite often this will result in a blanket exclusion of that condition, even if it was many years ago. Nomad Insurance Essential requires no medical questionnaire; so with a pre-existing clause that resets every year, once you are two years past any condition, they will cover it again. 

Check out the widget below to see how much your SafetyWing Nomad Insurance Essential will be! 

Final Note: As a Canadian who traveled full-time for 12 years, I was unable to qualify for standard travel insurance after my first year abroad (because I’d lost my provincial coverage, which travel insurance companies rely on). Thus, I was forced to get more expensive health insurance for expatriates, which frankly, wasn’t an ideal product for what I wanted – I simply wanted coverage for medical emergencies. I structured the policy to have an incredibly high deductible of $2,500 (to reduce my monthly premiums), such that it would only be useful in the event of an expensive medical emergency.

SafetyWing coverage is not based on the requirement for provincial coverage, which makes it a simple and cost-effective solution if you are a Canadian in a similar situation.

SafetyWing Nomad Insurance Complete:
International Travel Medical Insurance for Remote Workers and Long-Term Nomads

While the Nomad Insurance Essential is designed for emergencies and mishaps, SafetyWing’s Nomad Insurance Complete, (previously known as Nomad Health) is designed to be your comprehensive travel medical insurance and includes routine healthcare, mental health support, and maternity. This plan is perfect for nomads and remote workers who don’t plan on traveling home every time they have a routine appointment, screening, or check up. 

Nomad Travel Insurance policies include coverage for: 

• $1,500,000 max limit
• All essential benefits plus routine check ups, screenings, and vaccines
• Doctors and Specialists visits 
• Maternity care 
• Mental Health care 
• Cancer screening and treatment 
• Wellness therapies such as chiropractics, dieticians, and accupuncture
• Trip cancellation (up to $300 per trip) 
• Stolen Belongings ($5,000 limit) 
  
  

SafetyWing’s Nomad Insurance Complete: PROS

You get all the ‘Essential benefits’, plus routine health care, mental health, and maternity. Includes additional coverage for trip or accommodation cancelation, burglary, and delayed luggage.

You are covered in your country of residence, with the exception of any country or area that is sanctioned.

Discount for annual billing vs monthly. SafetyWing offers 10% off when you choose annual billing which gives you almost one month for free. 

Automatically includes the adventure sport add-on.
 

Nomad Insurance Complete : CONS 

Pre existing conditions are not covered before the plan starts. Any new conditions or issues that arise once you are already covered will continue to be covered as long as the plan is renewed. 

Hong Kong, Singapore and US are only included as an add on.

Coverage only goes until the age of 64.

Cannot cover residents (those living there for 6+ months out of the year) of Belarus, Canada, Democratic Republic of Congo, Iran, Iraq, Republic of Ireland, North Korea, North Sudan, South Sudan, Syria, Palau, Portugal, Saudi Arabia, Somalia, United Arab Emirates, and the USA and its territories.

Types of Travel Medical Insurance Plans (in General)

Not related to Safety Wing, here are the three general types of travel medical insurance you can get:

International Medical insurance for a single trip: This is the most popular insurance plan and is used when you’re going on a single trip that covers your entire stay.

Multi-trip International Medical (Annual plan): This provides international medical insurance coverage on a yearly basis that covers numerous trips a year (the policy will have terms for how many trips you can take and/or how long each trip can be).

Visitor Travel Medical insurance: This type of plan offers coverage for short-term visitors to the USA. 

Safety Wing Not the Best Option for You? Get Other Insurance Quotes Here

I’m a big believer in getting multiple quotes and comparing different policy options each time I take a trip. For example, on a recent trip, I planned to spend the winter skiing. I discovered insurance companies provide VERY different options regarding what kinds of skiing-related accidents they cover! This is NOT something you want to find out while you’re on the slopes.

So, here are a few more options for you to explore:

Genki offers both travel health insurance and international health insurance for digital nomads and long-term travelers, and is the insurance company I chose for my winter trip. The cost was the same as Safety Wing, however the coverage amounts are considerably higher and the sports coverage is more robust.

 Worldwide. Genki covers care in every country. Available to citizens of any country.

 Flexible monthly subscription. No long-term contract. Cancel anytime.

 Easy to sign-up (and cancel) in minutes, all online, from anywhere in the world.

What’s included?

• Reimbursement for medical treatment anywhere. Direct billing to any hospital. Telemedicine included.
• Choose your doctor. Genki covers treatment at any locally authorized healthcare provider.
• 24/7 medical assistance hotline. Medical rescue & transport.

Visitors Coverage is an insurance broker that will give you multiple quotes and match you with the best policies depending on your needs, including age, trip length, and destinations.

Also, I have gotten a lot of emails from seniors who have been dismayed at how many insurance companies either cut off or substantially reduce coverage for people over the age of 65. I have FINALLY found not one but TWO insurance companies with no age limit for coverage!

Travelex offers a few different travel insurance plans; their Travel Select plan offers coverage up to 364 days.
(Note: I don’t have personal experience with Travelex as it is only for Americans. Also, note that the coverage limits are quite low; if I were getting a policy from them I would spring for the Additional Medical Coverage upgrade).

Auras has a universal travel insurance plan with all essential coverage. It’s available to citizens of any country, aged 1 to 100. You can choose the amount of insurance you want (with higher limits than Travelex), and you can even make it a monthly renewable plan if you’re hitting the road for a long or undetermined amount of time. You can also purchase it if you’re already traveling, which is not possible with many insurance companies.

2026 UPDATE: Buyer Beware! I checked out Auras Insurance with the intention of buying one of their policies in December 2025. There were a variety of red flags that swayed me from using them.
For example, their specific policy language was almost impossible to find on the website, as was their underwriter. After some additional research, I discovered it’s underwritten by a company in the UAE, and Auras itself is in Comoros (offshore entities would be bound by different laws and in the case of a dispute would be nearly impossible to work with).
When I messaged customer service to get some information on an additional rider I was considering, they were unhelpful to the point of being rude. Not a good sign if you need to contact them in the event of an emergency.
And, when I finally did track down the policy language, I found it to be very exclusive. Repeatedly as I read it, I thought “if I needed to make a claim, this could be used to get out of paying me.” I laughed out loud at their coverage of ground transportation to the hospital in the event of an emergency: “taxi”. Not an ambulance – a taxi.
The limits were also atrocious. Although the overall policy limit was a high number, each category of claim had a much (much) smaller number that would be near useless if I had a serious medical emergency.
Then I looked at Trust Pilot reviews, which were mixed. Although 73% were 5-star reviews, a goodly portion of those reviewers never needed to make a claim. There were also 19% 1-star reviews, full of detailed accounts from people who had claims denied. Every insurance company will deny claims and create irate customers who leave bad reviews, but if there is a large number of these reviews (and if they’re recent, as these were), it’s a red flag. 
May this serve as your warning: read your insurance policy cover to cover, and make sure you feel okay with it! Your life – or at least your finances – may depend on it.

This post Best Travel Insurance for Long-Term Stay or Trip appeared first on The Professional Hobo. Please click through to read it in full!

In doing my end-of-year finances and preparing to file my taxes, I had a hard look at my banking fees. I noticed they were down significantly over years prior, and it’s because I started using Wise (formerly called TransferWise). So I delved into a dizzying flurry of calculations and comparisons to show you exactly how I save over $2,000/year on Wise vs PayPal by using the Wise Borderless Account (click here for more info, and read on for my Wise review).

In this article, we will focus on the top two most popular money transfer services: Wise vs PayPal.

If you click on one of the Wise links in this article and use their service, I will receive a referral fee. I wholeheartedly stand by their service, and perhaps after reading this Wise review, you will as well. 

This Article Isn’t Like Most Wise Reviews

It’s worth noting that a lot of Wise reviews focus on the benefits (and drawbacks) of using Wise to send money internationally. I’m tackling this a different way: I use Wise to get paid internationally, and transfer the money to my bank account. So if you are a freelancer, entrepreneur, remote worker, expat, or foreign landlord who gets paid in a foreign currency (or as in my case, multiple foreign currencies), this article is for you. 

What is Wise?

Wise (previously known as Transfer Wise) is a London-based financial technology company that was founded in January 2011. It provides an international money transfer service with low fees, great exchange rates and fast transfers.

The Wise platform is available online, on iOS and Android, and there are Wise Borderless accounts available in over 40 different currencies. Wise has grown to become the largest international money transfer service in Europe, with more than 16 million customers worldwide.

Key features of Wise include:

1. Low fees

Wise charges a flat fee based on the amount you’re sending and the currency you’re sending it in. Fees are typically 1-2% of the amount you send, depending on the currency, but Wise also offers discounts for frequent transfers or to students and charities. If you’re transferring money from your Wise account to another Wise account user, it’s free.

2. Great exchange rates

Wise offers competitive exchange rates that are usually better than those offered by banks. Unlike banks, Wise also doesn’t have hidden fees or costs.

3. Fast transfers

Wise transfers usually take 1-3 days depending on the currency you’re sending and the payment method you choose. Some currencies can be transferred in as little as a few minutes.

4. Security

Wise is regulated by the Financial Conduct Authority in the UK, and they use bank-level security measures to protect your money.

5. Ease of use

Wise’s online platform is easy to use, and you can also send money through their mobile app.

6. Customer service

Wise has 24/7 customer support available in 14 languages.

Key Stats of Wise Includes:

• Wise is available in more than 160 countries
• Wise serves over 16 million customers
• Wise processes over £9 billion every month.
  
  

What is PayPal?

PayPal is an American company founded in 1998 and it provides an online payments system for individuals and businesses. PayPal allows users to send money, receive money, make purchases and transfer funds securely. PayPal is known for its fast transfers, ease of use and high fees.

Key Features of PayPal Include:

1. Fast transfers

PayPal is known for its fast transfers, allowing you to move money between countries in a few minutes.

2. Widely accepted

PayPal is accepted by millions of merchants, so using it makes it easy to make purchases online or in stores.

3. Security features

PayPal has advanced security features, such as two-factor authentication and encrypted communication.

4. Ease of use

PayPal is simple to use, and you can send money online or through the mobile app with just a few clicks. 

5. Customer service

PayPal has 24/7 customer support available in multiple languages.

Wise vs PayPal

This comparison is specifically between Wise vs PayPal. PayPal has for many years now, been the industry standard for sending and receiving payments online; considered the best way to send money internationally. Friends use it to transfer money to one another, businesses use it to invoice and send and receive payments (including credit card payments), and consumers use it to pay for goods and services. It is recognized and trusted as the way to pay for things (and get paid for things) online. 

And Wise is not a 100% substitute for PayPal. For example, Wise doesn’t offer e-commerce payments, email invoices, and payment links. Wise does one thing, and they do it well: they are the best money transfer app with the cheapest way to send money internationally (and conversely, to receive money from overseas). 

Speaking of fees, let us take a look at Wise vs PayPal in terms of fees and exchange rates.

PayPal International Fees

By using PayPal, you are paying (outrageously) for this brand recognition. Look beyond the surface, and PayPal international transfers involve fees coming and going. People who are throwing currency conversion into the mix are especially unlucky. 

The problem is, PayPal international fees (and domestic fees for that matter) are ambiguous at best. There are separate systems with multiple qualifying criteria for merchant fees and consumer fees. There are huge charts that outline different fees depending on which country you are sending money to or receiving money from (and in the case of a merchant/business account, a long list of variables depending on the type of payment). 

A gross generalization for receiving money with PayPal would be if it is a domestic transaction, they charge 2.9% plus a fixed fee (which is approximately $0.30 depending on the currency). If you are receiving money internationally, they’ll tack on an additional percentage of about 1%. On the whole, it works out to about 3.8% in fees. You get lucky if your payor is processing a domestic payment as a personal or batch or ACH payment, in which case (glory hallelujah) you can receive the money for free. 

With this fee structure, you’ll get fleeced receiving small payments. I’ve been using PayPal as my payment processor for my books; for every $6.99 I get for each book, I pay a fluctuating fee (I don’t even now why it fluctuates but it does) of around $0.57 (which – I believe?? – is 3.8% plus $0.30). That doesn’t seem like much, but it’s 8.2% of the book’s sale price! Sell 100 books and add up the fees and I feel the pinch. 

And we haven’t even converted the currency yet. Take a look at the international PayPal currency conversion fee (we’ll get to that in detail later in this article), and they don’t just state in their fee structure that they take 4%; no, they say “minimum” of 4%. What does that even mean??? 

Even more annoyingly, that 4% they take as the PayPal conversion fee is practically invisible. They just work it into the conversion rate and hope you don’t notice. 

I noticed. 

Wise Fees

Wise prides themselves on being not only radically transparent with their fees, but also incredibly competitive. With their Borderless Bank Account (also known as a Multi-Currency Account), you can receive payments in nine currencies as if you are a local. This makes the transfer easy for your payor, and free for you. The Wise rate for wire transfers entails a fee that varies with the currency but is consistently way less than a bank would charge for a wire transfer. 

Real Life Example: I wrote an article for a British publication. On the invoice, I included my UK bank details (as provided by Wise), so they paid me as if they were paying a bank account down the street, which made it cheap/free for them, free for me, and super quick. 

Once you have received the money to your Wise Multi-Curency Account, you can convert to and hold the funds in 40+ currencies! You can also transfer it to your (physical) bank account in any of those currencies. Best of all? Wise exchange rates are clear, and guaranteed to be the mid-market rate; this means they don’t charge a fee for currency conversion. 

Real Life Example (continued): Now that I had a balance in my Wise UK account, I transferred it to my Canadian bank account at home. They did it at prevailing currency conversion rate, plus a very small – completely transparent – fee (more on this in the case study below). 

Can I get an amen? 

BONUS: As a self-employed location independent freelancer and entrepreneur, banking fees are tax deductible. Every time I transfer money from Wise to my local bank account, they show me exactly how much money I’m paying in fees. This makes it ridiculously easy to track – and deduct – these fees on my taxes. 

Click here to set up your Wise Account.

See also: Filing Taxes as a Digital Nomad – What you Need to Know

Now that we’re much aware of Wise and PayPal fees, it’s time to see which is better when it comes to Speed, Transaction Fees, Exchange rate, Location covered, Security, Ease of use, and Customer Service.

Transfer Speed

Let us take a closer look at PayPal’s transfer speed. PayPal takes 1-3 business days to process and sends the money, but it can take up to 7-10 days for the money to be received by the recipient. Internationally, it can take even longer than that.

On the other hand, Wise transfer speed is much quicker than PayPal’s. Wise normally processes transactions within 24 hours, and typically sends the money within 2-4 days for domestic transfers. 

Depending on the country and currency, Wise sometimes delivers money as soon as the next day or in some cases, even instantly. Wise also allows you to set up automatic payments and recurring transfers, making it easier to stay on top of bills and other obligations.

How Much Money Can You Save?

PayPal charges exorbitant fees for its international payments – ranging from 3.4% – 6%, depending on the country you’re sending/receiving money from. 

Wise offers much better rates. Wise / Transfer Wise charges a flat fee, which can range between 0.3% – 1% of the transaction amount, depending on your currency and destination country. They also offer discounts for larger transfers – up to 50%.

Exchange Rate

As mentioned before, Wise offers fair, clearly displayed exchange rates that always land at the mid-market rate. This means that Wise is always transparent about the fees you’re paying and there are no hidden charges or surprises. Typically, the mid-market rate is 1-2% better than what PayPal offers.

PayPal, on the other hand, often works charging an inflated exchange rate to make money from currency conversion fees. As a result, you end up paying more than you would have with Wise.

Location Covered

PayPal allows users to send payments in over 200 countries and regions across the globe. Wise is currently available in 59 countries but is constantly expanding into new territories as well. Wise can be used to make international transfers from most countries, so the chances are that Wise is available in your country.

Security

Both Wise and PayPal are secure platforms, as they use the latest technology to protect their customers’ funds. Wise uses 256-bit encryption and two-factor authentication to ensure that all transactions are safe and secure, while PayPal protects its customers with state-of-the-art security and fraud prevention systems. 

It’s clear to see that PayPal and Wise both put a strong emphasis on providing a secure service, but PayPal may be slightly better in this regard.

Ease of Use

Starting from setting up an account to sending money, Wise is very easy to use. Its user-friendly interface makes it extremely easy for anyone to make payments, and the fast transfer speeds mean you won’t have to wait too long for your money to arrive. 

PayPal, however, is a bit more complicated to use, due to its extensive range of options and settings. In addition to that, PayPal can be quite slow – especially for international payments.

Customer Service

Wise has 24/7 customer service, and their staff is always willing to answer any questions you may have about the platform. Wise also has an extensive Help Center with detailed explanations on how to use all of Wise’s features, as well as a comprehensive FAQ page. 

PayPal, on the other hand, has limited customer service hours and is not as helpful when it comes to answering specific questions.

Best Way to Transfer Money Internationally: Case Study (Wise Review)

Let’s put some numbers to this, shall we? 

Who this is for: 

• If you are a freelancer or self-employed with an online or international business, chances are you will be receiving payments in multiple currencies. 
• If you are a remote worker or expat with a telecommuting job or business that entails being paid in one currency, and you want to transfer that money to a local bank account in the country you’re residing in, this also applies to you. 

I am a Canadian citizen and resident, so I have a Canadian bank account (duh). But I earn money in $CAD, $USD, $AUD, £GBP, EUR, and more. Here’s how I use both PayPal and Wise to receive and transfer money internationally, and the fees to do it. 

Receiving International PayPal Payments

Let’s start with a $1,000 USD payment. As a Canadian with a Canadian PayPal account, this is considered an international payment, and I’m subject to the full monty of PayPal international transfer fees. 

I’m receiving a $1,000 payment in USD. The prevailing conversion rate to $CAD on the date of writing this is 1.265. (So $1,000 USD = $1,265.23 CAD). 

PayPal takes 3.8% (average) = $38

I am left with $962 USD ($1,216.93 CAD)

Now, I need to move that $962 USD from PayPal to my Canadian bank account. 

The prevailing conversion rate is 1.265, but PayPal tacks on 4% and thus changes the conversion rate to 1.2297. 

This means they are taking an additional $26.84 USD ($33.96 CAD) in conversion fees. 

In the end, I receive $1,182.97 CAD (which is $935.15 USD). 

Confused? Here’s the short and skinny: 

For every $1,000 USD I receive in PayPal, I pay a total of $64.84 USD in fees, which is 6.5%. 

Let’s say I earn $40,000 USD in a year through PayPal. I’ll pay $2,593.60 USD in fees. Yowza. 

Receiving Money Internationally With Wise

Let’s look at the same $1,000 USD payment. I receive it in my Wise Multi-Currency Account, which to my US payor, is like any normal US bank account. My payor makes an ACH payment and thus I pay $0 to receive this money. 

Now, I want to transfer the $1,000 USD to my Canadian bank account. 

Wise charges $0.48 + 0.44%, which adds up to $4.88 USD ($6.17 CAD). 

I receive $1258.82 CAD to my Canadian bank account. 

Don’t believe it? Let’s make this indubitably clear: 

For every $1,000 USD I earn, I pay $64.84 USD in fees with PayPal, or $4.88 USD with Wise. 

Thus, I save $59.96 USD for every $1,000 I am paid. 

So, if I earn $40,000 USD, I save $2,398.40 USD by using Wise. 

The PayPal Currency Conversion Fee Workaround

Sometimes, you just have to receive money via PayPal. Many of the vendors I work with and earn affiliate income from only make payments to PayPal. Never fear, there is a workaround to reduce the exorbitant PayPal international fee. 

Let’s look at the same $1,000 USD payment (which converts to $1,265.23 CAD at prevailing rates). 

I receive it to my PayPal account, and (as above), I pay an average of $38 in fees, leaving me with $962 USD. 

Now, instead of transferring the money from PayPal directly to my Canadian bank account, I transfer the $962 to my Wise $USD account. PayPal doesn’t charge for standard transfers out to same-currency bank accounts. And because there is no currency conversion involved, PayPal doesn’t get that extra $26.84 in hidden currency conversion fees. 

With $962 USD in my Wise account, now it’s time to transfer it to my Canadian bank account. They take off $0.48 + 0.44%, which is $4.71.

I get $1,210.97 CAD (which is $957.29 USD).

Total fees paid with the PayPal Currency Conversion Fee workaround: $42.71 USD, which is a whole lot better than the $64.84 USD I’d have paid if I didn’t use Wise for the currency conversion. It’s an extra step, but well worth the $22.13 USD I save. 

TL:DR (Cheapest Way to Send Money Internationally)

Numbers aren’t everybody’s jam, and if that’s you, you probably have a headache right now. So I’m going to summarize the above calculations as succinctly as possible, using the same $1,000 USD payment. 

• With PayPal, I pay $64.84 USD in fees.
• With Wise, I pay $4.88 USD in fees.
• If I must receive a payment to PayPal, then doing so and then using Wise for the currency conversion means I pay $42.71 in fees.  
  

Sold? You should be.
Click here to learn more about saving big money with Wise.

Wise Business (Formerly TransferWise for Business)

As a self-employed entrepreneur with fairly simple needs, I currently use a personal Wise account. But this year I will change it to a Wise business account, so I can further streamline my business accounting and save even more money. 

So let us learn more about Wise Business and how it can help your business, shall we?

Here are a few benefits of the Wise Business Account: 

• It’s an alternative to a business bank account with your home institution, which will inevitably charge you monthly fees. 
• You can invoice like a local. 
• Avoid fees on Stripe.
• Spend money directly from your Wise account with their debit card. 
• Send and receive money in multiple currencies. 
• Make batch payments. 
• And if you are a large enterprise with an international payment volume in excess of $200k/month, they’ll set you up with an API to help you scale. 

The fees with Wise business accounts are the same as with personal accounts, with one exception: you pay a one-time fee of $42 USD for each international bank account (ie: currency) you set up. Amortized over years of saving fees with the likes of PayPal or even a local business account and processing international wire transfers, it’s a drop in the bucket. 

Is Wise Safe?

You might be wondering if Wise is some online fly-by-night operation that is going to collapse, abscond with your money, compromise your data, or in some way leave you high and dry. I asked a friend “is Wise safe” after they told me about it and they looked at me like I was from the moon. After a bit of research, I soon realized why. 

With 9 million+ customers, $6 billion+ transferred, regulation by the FCA, and Trust Pilot ratings by happy customers, it’s safe to say Wise is here to stay. 

I haven’t even touched on things like how to send money internationally from your home bank account to another country, but rest assured Wise can help you out there too. Wise changed how I do business. How I receive payments from around the world and minimize banking fees and currency conversion fees. 

Before Wise, I used to dread doing business internationally because of all the headaches that came with it- like trying to find a way to minimize banking fees and currency conversion fees. Thankfully, those days are behind me now.

Verdict: Is Wise or PayPal Better?

You should know by now that Wise is the better option when it comes to international money transfers. Wise offers much lower fees, fairer exchange rates, faster transfer speeds, and more convenient features than PayPal. Wise is also a safe and secure platform that you can trust with your funds. In short, Wise beats PayPal in almost every area – so if you’re looking for an easy and cost-effective way to send money abroad, Wise is the way to go.

But then again, I would like to mention that Wise is not entirely a replacement for PayPal. Wise is ideal for international payments, but it can also be used to transfer money domestically as well. PayPal still offers its own unique features that Wise doesn’t have, such as peer-to-peer payments and mobile payment options. So ultimately, Wise and PayPal both offer their own advantages and are great for different purposes – so the choice will depend on what you need.

—

In conclusion, Wise is an excellent choice for conducting international money transfers. They have helped millions of people send money abroad quickly, securely, and cost-effectively. With Wise’s low fees, competitive exchange rates, and fast transfers – you can rest assured that your money is in good hands.

Sold yet? I hope you are. Click here to set up your Wise account today. 

This post Wise vs PayPal: How I Saved $2,000+ in Banking Fees appeared first on The Professional Hobo. Please click through to read it in full!

Without the requirement of reporting to a physical workplace, plenty of workers are considering  their ideal location to work from. For many freelancers, remote workers, and independent contractors, their location isn’t even within the same country as their employer.

What are the rules around working remotely? This guide will help you out with your questions regarding taxes whether that be you have a visa for remote workers, freelance visas, temporary resident visas, as well as tourist visas.

Olivier Wagner is the founder of 1040 Abroad, and he’s been helping expats and digital nomads with their U.S. tax needs since 2012. He prepares U.S. tax returns for expats and nomads who need regular annual tax filing, people getting into compliance after years/decades of not filing, and even people planning to renounce their citizenship. He also prepares Canadian tax returns! 

I asked him to help answer the questions top of mind for remote workers who want to live abroad and take advantage of remote work visas. Below are his words of wisdom. 

You Might Also Like: 

• How to Manage Your Money: A Guide to Financial Planning for Long-Term Travelers
• 4 Financial Mistakes Most U.S. Expats Make
• Expat Health Insurance: Travel Insurance for Long-Term Travelers

The following is written by Olivier Wagner of 1040Abroad.com. 

Remote Work During COVID-19

As the COVID-19 crisis hit, a few interesting things happened, namely:

• Countries that relied on tourism saw that source of income vanish almost completely overnight. And many of these countries no longer want people coming in and out, staying 2 weeks or less, potentially spreading the virus to the local population.
• As companies took measures to counter the spread of the virus in the workplace, the ability to work remotely became not only widely accepted but downright necessary.

As a result, countries are wisening up to make up for the lost tourism income. They’re capitalizing on remote work trends to attract a longer-term population of foreigners who would earn money from overseas and spend it in the local economy. By staying put, they would also mitigate the risk of spreading the virus.

And some employees also wised up: “If I can work from home, would it make a difference if my home was next to the beach on some tropical island?” 

Tips for Working in Another Country:

• If you’re thinking about working abroad, it’s an excellent idea to get some guidance from an expert to make sure that you’re following the local laws of authority you’re about to travel to.
• There is no ubiquitous visa rule for every country in the world. A few countries may allow you to work on a tourist visa only if the extent of your work is restricted to your country of residence. While others might require a more grating approach especially if you’re on a long-term visa. Places like Antigua and Barbuda have a nomad residence permit for those who want to work remotely elsewhere.
• No matter where you are in the world, paying tax is a requirement. Your responsibility depends on your citizenship, which country you’re a resident in, and where you are staying/working.
• If you have a record of residence in two countries at the same time, you might  get double taxed. To avoid this, it’s best to consult  with an expert. (Check out what Kathleen from Wanderer’s Wealth can offer).
  

QUICK-FIRE Q&A: REMOTE WORK VISAS AND TAXES

Here are a few potential questions you may have about remote work and the quick answers. Further down you’ll get the full scoop. 

If I’m working remotely from Bermuda for a year, where do I file my taxes? Bermuda? Or my home country (U.S.)? Or both? 

First, assuming the case of a US citizen who is working in Bermuda: U.S. citizens would have to file a U.S. tax return. Bermuda stated that they will not tax those who work for a foreign (non-Bermuda) employer under the digital nomad visa. As such, they would not have to file a tax return with Bermuda.

Is the answer to the above question different depending on the country I’m living in that year? (eg: Estonia vs Bermuda)

Let’s look at a few countries:

The Barbados Welcome Stamp allows you to work remotely in their country for 12 months without collecting any tax.

Estonia and Iceland do not address that question in their digital nomad visa FAQs. Instead, if we turn to the US-Estonia and US-Iceland tax treaty, we find that one doesn’t have to pay tax income tax there if:

– He or she is present in Estonia / Iceland for less than 183 days in the year

– He or she is an employee of a US company (which doesn’t have a presence in Estonia / Iceland)The same would apply if he/she was from Canada as the Canada-Estonia and Canada-Iceland tax treaties have the same provision.

Dubai, part of the UAE does have income tax system for individuals, so no need to file a tax return there.

For other countries, check the FAQ of their official website describing the digital nomad visa, the international taxation page on Wikipedia, or contact me at owagner@1040abroad.com

What’s involved with filing my taxes abroad? Can I get my U.S. accountant to do it all?

Few accountants would be proficient in two or more tax systems. If you are required to file a local tax return in the country you are visiting, you most likely would hire a local tax preparer to file the local non-resident tax return, reporting only the employment income earned while in that country and then hand it over to your U.S. accountant who might use it to claim a foreign tax credit.

To be honest, I expected many such digital nomads to only file in the U.S., as a practical matter. I am pleasantly surprised to see that most of these countries legitimately do not require you to file a tax return.

If I qualify for Foreign Earned Income Exclusion (FEIE) because I’m living abroad that year, and I work remotely for a U.S. company, does that mean I don’t pay tax at all (up to $106k)? Or will I still have to file and pay tax in Bermuda (for example)?

That’s correct, if you can exclude all of your earning using the FEIE (more on that in a minute), you wouldn’t have any U.S. income tax owing.This will not impact your local income tax obligation. So you would still owe tax to the local country if applicable, but as we’ve seen it’s not usually required to file taxes abroad.

DETAILED TAX REQUIREMENTS FOR REMOTE WORKERS LIVING ABROAD

This information is specifically for people who had a brick-and-mortar job that has been converted to a remote job. It may also be useful to those who were already digital nomads, but probably to a lesser extent since you probably already did some tax planning. I’ll further restrict it to those from Canada and the United States (although residency-based taxation countries tend to operate in a similar way as Canada).

Income tax

As mentioned above, you would still report your worldwide income on your U.S. income tax return (Form 1040) for as long as you remain a  US citizen (feel free to contact me if you want to change that and have some questions).

The fact that the U.S. operates on a citizenship-based taxation regime is often criticized, and rightly so. But fortunately it also has the Foreign Earned Income Exclusion which in some way makes it more attractive than other countries.

Foreign Tax Credit 

If you paid income tax to the destination country on your employment income (which was anything you earned while physically present in that country, regardless of who your employer is – for example if your employer is a US corporation and you are paid into a US based bank account), you will be entitled to claim a foreign tax credit on form 1116. It will give you a dollar-for-dollar credit for taxes paid to that country, and therefore it would completely offset your US income tax liability if the tax rate in the destination country was higher than the one in the US.

Foreign Earned Income Exclusion (FEIE)

I will however assume that you didn’t pay foreign income tax, or if you did it was at a rate significantly lower that the US tax rate. As such, you would have to rely on the Foreign Earned Income Exclusion instead. The Foreign Earned Income Exclusion allows you to exclude your foreign earned income, meaning either wages or self-employment income that were earned when you were physically present in a foreign county. 

For tax year 2020, the maximum exclusion is $107,600 per person.In order to qualify, you would need to meet either the Bona Fide Residence Test or the Physical Presence Test:

Bona Fide Residence Test

This test requires you to be an actual resident of a foreign country; it would be achieved by having many ties with that country. In addition, it is a legal requirement to have been a resident of that country for a full calendar year. 

As such, someone who left the U.S. in 2020 would not be able to claim the Bona Fide Residence Test since he/she was not a resident of that country on January 1, 2020.In addition, having a remote work visa valid for a single year is probably not sufficient to claim that test regardless. It would require a more permanent immigration status.

Physical Presence Test

This is probably the one you will rely on to completely avoid paying U.S. income tax on the income earned in the destination country. It requires you to have spent at least 330 days in a foreign country or countries within any 12 month period (leaving you 35 days to spend in the U.S. or over international water). 

The important word here is “any” 12 month period; as such, May 18, 2020, to May 17, 2021, would be one such period – although that would mean: 

1. That you would have to file your 2020 tax return after May 17, 2021, and
2. The maximum amount that can be excluded would be prorated. So instead of being $107,600, it would be 107,600/366 x {the number of days of that 12 month period which fell in 2020).

You can find info on the Foreign Tax Credit vs. the Foreign Earned Income Exclusion here.

Social security

If you work for a U.S. corporation, generally speaking you will still be liable to pay social security even if you work outside the U.S. – your employer would simply continue to withhold your social security from your paycheck/W-2.If you work for a foreign (non-US) corporation, you would no longer be liable for social security taxes when working outside the U.S..If you are self-employed, you will be liable for social security tax; it will be called self-employment tax in this case. The filing is easier (attach schedule SE to your tax return), but the rate is the same 15.3% of net income. 

You might be able to avoid paying it if your destination country has a social security totalization agreement with the U.S., but that would also mean that you would now be paying social security tax to that country instead.

Filing Tax for Remote Work Visas

To put it straightforwardly, your income taxes should be processed in  the country or state that you’re working or residing in, even if your clients or employer live in a different state or country.

This applies to both a regular W-2 employee and an independent contractor (freelancer). This pertains to everyone including remote workers and digital nomads. 

As I’ve mentioned above, some places require you to file for double taxes. Simply, if you live in your resident state but you have your non-residence state listed in your W-2 form, you are required to file two tax returns. This doesn’t necessarily mean that the tax you’re paying will be doubled. In some cases, the resident state usually issues a tax credit for the taxes paid to the non-resident place to avoid this.

Tax rates for contractors also change from country to country, it’s best to consult local guidelines for the particular tax rates and saving tips.

Tax for Canadian Citizens Abroad

Canadian citizens and residents have a different tax situation to the United States. 

Income Tax

Similar to United States citizens, you would still report your worldwide income on your income tax return as long as you’re a Canadian resident.

Canada does allow you to claim a Foreign Tax Credit for taxes paid to a foreign country. It will give you a dollar-for-dollar credit for taxes paid to that country, and therefore it would completely offset your Canadian income tax liability if the tax rate in the destination country was higher than the one in Canada. Sadly, with the Canadian tax rate as high as it is, you may still have some actual tax owing.

What about becoming a non-resident of Canada? 

In most cases, you would need to cut your ties with Canada and establish strong ties with the destination country. It most likely wouldn’t be the case if living there for a year on a remote work visa although you could have a stronger case if staying multiple years. Generally, these digital nomad visas wouldn’t allow you to become a non-resident of Canada.

If you are a tax resident of the other country and that other country has a tax treaty with Canada and you have a “permanent home available to you” in that country and not in Canada (feel free to contact me to discuss it further), you would have a somewhat better chance of being a non-resident of Canada by using the tax treaty (and therefore stop being taxed on your income sourced outside Canada).

Nora’s Note: I looked into becoming a non-resident of Canada when I traveled full-time and it felt pretty extreme (requiring me to close all bank accounts and stay out of the country for certain amounts of time). So for lack of staying anywhere else long enough to become an official resident of that country, I remained a “factual resident” of Canada for all the years I lived and worked abroad. That meant I filed one tax return – to Canada – and I claimed my total worldwide income each year. I was very grateful for having arranged my finances this way when I eventually returned to Canada to set up a home base. 

Canada Pension Plan (CPP)

Generally, employment has to take place in Canada to be taxed under the Canada Pension Plan or the Employment Insurance Act. However, in certain situations employment outside Canada may be taxed as well. This is the case if a person is working outside Canada for a Canadian company or the Canadian government.

In addition, if you are an employee working outside Canada, voluntary CPP contributions can be made if Canada has a Social Security totalization agreement with the other country.

How Remote Workers Can Save and Pay Less in Taxes 

Aside from things like medical insurance and budgeting for the country you’re residing in, paying taxes can be quite draining. But if you have everything in order, you can budget for it and it won’t take you by surprise. . With that being said, here are some tips to keep in mind:

• Look up the local constitutions about what differentiates employees from contractors and know what your status is. Always double check and don’t make assumptions..
• Before you travel or move somewhere outside the U.S., it’s best to  learn about all the different laws and requirements regarding income taxes.

If you don’t speak “accountant”, some of the jargon in this article might have been tricky. I started 1040 Abroad in 2012, as a US citizen who moved to Canada. I have since been a Canadian resident, a Canadian non-resident, and a resident again. So I know the ropes, and I welcome your questions.

For more information, please contact my team here. – Oliver Wagner

This post The Tax Consequences of Remote Work Visas appeared first on The Professional Hobo. Please click through to read it in full!

Living life as an expatriate can be done successfully, but there are many pitfalls. When it comes to financial literacy and demographics, expatriates run the gamut from older people who worked for years and have retired, to young and middle-aged people who have compiled large sums of money through savings, inheritance or winnings. And of course, let’s not forget the ever-increasing trend of remote workers who have the location independent freedom to live and work anywhere in the world. 

Regardless of how it happens, it cannot be stated strongly enough that if a successful life outside of the United States is the goal, the financial side of things has to be done right. Expat financial mistakes can be very costly.

Nora’s Note: As a Canadian, I’m not fully familiar with financial regulations and requirements for U.S. citizens. So I’ve asked Marc J. Strohl, CPA, to write this article. He is the founder and managing director of Protax Solutions, one of the largest and most trusted companies specialized in expat tax services. He is a leading expert in the taxation of individual U.S. expatriates and/ or foreign nationals. A member of the American Institute of Certified Public Accountants (AICPA) and the New York State Society of Certified Public Accountants (NYSSCPA), Marc has published articles in many critically acclaimed publications including Thomson Reuters’ twice-monthly newsletter publication Practical International Tax Strategies.

Top 4 Expat Financial Mistakes

The following are four examples of expat financial mistakes a U.S. expat should avoid at all costs.

1. Doing Nothing at All

Expatriation is not a simple process. This is never truer than when navigating the financial obligations and responsibilities of life as an American citizen living abroad. Expatriate financial responsibility is complex and exacting, and can be so intimidating some people may be overwhelmed and freeze like a deer in headlights. Anyone who has ever seen what can happen to a deer frozen in headlights knows it doesn’t usually end well. Expect a similar outcome when an expat opts to take no action at all in terms of money management and U.S. tax compliance. 

In terms of taxation, procrastination can happen for several reasons or any combination thereof: 

Fear – Expats who have been gone a while without tending to financial matters may be afraid that they have reached a financial point of no return, and that their finances or tax situation may have grown far beyond their ability to contain the damage or do anything about it. The impulse to live in denial and just not think about it, hoping the problem will go away may be very strong. Unfortunately, not thinking about financial obligations will only make their money go away, not their obligations.

Ignorance – Some have no idea that as a U.S. citizen living abroad, they still have a legitimate obligation to file a United States tax return. They may believe that since they are living abroad and paying tax to that country, there is no reason to report their income to the U.S. government, much less pay a portion of their income to Uncle Sam. By the time they realize it, they could be in for a very rude and expensive awakening.

Rebellion – Contempt for the system may be the very reason some people leave the U.S. and they may consider taxation, particularly from a country they no longer actively live in and whose authority they may not recognize, a form of theft. These people will staunchly refuse to pay their tax obligation regardless of all other factors, even though they may be responsible regarding other financial matters.

In all these cases, things end more or less the same way: badly. Ultimately the Internal Revenue Service will find them; they are very good at finding non-compliant American expats. Once located, the IRS can turn their liberated expatriate dreams into a waking nightmare of financial anxiety and excruciating, nest egg draining assessments and penalties. Don’t let this happen to you. Find a proper online service that specializes in tax advice for U.S. expatriates and get the help you need to avoid this all too common trap.

2. Severing Banking Relationships

Believing that their time stateside is done, some expats may think it’s okay to no longer maintain any sort of physical address there, or to close their banking accounts and credit cards in good standing. This is a bad idea for a number of reasons. 

When a physical address isn’t maintained, accessing one’s bank account can be very difficult, as can re-establishing credit when and if the expat decides for whatever reason to move back to the United States. For this reason, it is advisable to keep some sort of mailing address on file; a virtual mailing service, a relative, or even a close and trusted friend. This allows a correspondence lifeline back to the U.S., even if most banking is done by smartphones in the present day. 

Closing bank accounts and credit cards in good standing is another move that can come back to haunt an American expatriate. Closing a credit card in good standing can hurt one’s overall credit score. It is certainly not necessary to maintain every single card, but keeping a home currency credit card for domestic purchases would be wise, even if there’s a yearly maintenance charge to do it. Care should also be taken to alert card issuers and banks about relocation in plenty of time for them to update their files and know not to issue red flags once card and banking activity begins in another country.

Learn how to maintain a physical residence address by using a Virtual Mailing Service

Also, Check out my articles about financial planning from abroad as well as banking and cash management tips. 

3. Living Above One’s Means

Being a newly arrived transplant in an unfamiliar country can be a thrilling, liberating experience. Everything is fresh, new, and exciting. It can be a time of renewal, and even rebirth, as we shed personas we’ve worn all our lives and reinvent ourselves as the person we may have always wished we could be. It can be very easy to start spending extravagantly to help construct this new character. If the country is a low tax nation, the impulse to spend can be even more intense. From flashy new clothes and expensive dinners, to electronics, furniture, and even automobiles, spending can grow out of control with a shocking speed if not curtailed. Getting caught up in an unsustainable lifestyle can derail an expat utopia, so spend wisely and track finances carefully. 

Nora’s Note: Great advice! Learn about creating a sustainable budget for your life abroad. 

4. Having Too Much or Too Little Health Insurance

This is a big one. Failing to properly establish an appropriate expat health insurance plan can prove disastrous to the expatriate experience, should a serious injury or accident occur. Health care is expensive (depending on the country), and paying out of pocket for healthcare can drain funds extremely quickly if not managed with care and attention to detail. 

Not having enough insurance means high deductibles and essentially paying out of pocket for all procedures. Too much insurance may translate to paying twice as much for unnecessary coverage when more appropriate levels could be found elsewhere. Examine your options exhaustively, paying special attention to international health insurance policy alternatives and properly vetting the selected insurance companies for legitimacy and best coverage for the money. 

Carefully research the plans available, taking care to remember that less expensive plans may not provide the coverage needed or additional coverage that may be specific to certain countries. Even if a country offers subsidized or free health care, this may not be applicable to foreign nationals. Have an understanding beforehand of what visa or residency status means in that country and adjust health insurance expenditures according. This is one area where not getting it right can shatter an expatriate’s dream of a comfortable life abroad.

One Final Word of Advice 

Don’t let the inevitability of making small expat financial mistakes dissuade you from finding the life you want. Just take care to learn from those mistakes, and try to never make the same one twice. A life abroad can be yours but it doesn’t happen by accident; it takes planning, commitment, and even courage, but it can also be one of the most rewarding experiences of your life.

You Might Also be Interested In: 

The Irony of Expat Life: Pros & Cons

Expat Insurance: Health Insurance for People Living and Traveling Abroad

Filing Taxes: A Guide for Digital Nomads

Expat Life in Hoi An, Vietnam

This post 4 Financial Mistakes Most U.S. Expats Make appeared first on The Professional Hobo. Please click through to read it in full!

How to Save Money For Travel: The 5-Step Method

First, let’s look at the big picture. These five inter-related elements will help you transform your finances into a travel saving machine! Not all five steps may be necessary (for example, you might decide you don’t need or want to do Step 4); customize this template to make it yours. 

1. Track Your Expenses

Glib as it may seem, you must know where you’re starting in order to figure out where you’re going. Understanding exactly how you spend your money is essential. 

I use a travel-friendly expense tracking app into which I manually input every dollar I spend and assign relevant categories for analysis. I do it as soon as I spend the money, and I don’t judge myself: I just enter the expense. Some people prefer using programs like Mint that link up with their bank accounts and credit cards and track their spending habits automatically. Do whatever works best for you, and whatever you stand the greatest chance of maintaining. This is a long-term exercise; I’ve been doing it for decades. 

At the end of each month, take a look at your expenses. Are there any surprises in there? Anything higher or lower than what you anticipated? Only when we see our expenses from a bird’s-eye view, can we decide whether the things we’re spending our money on are ultimately worth it. 

2. Create a Monthly Expenses List, and Reduce Fixed Expenses

Once you’ve tracked your expenses, you have a starting point. Look for patterns in your spending and create a monthly expenses list (include weekly expenses by multiplying them by four). It doesn’t have to be an exact figure; ballparks work for slightly variable expenses such as utilities, which can fluctuate. 

Then, take a look at these monthly expenses. This includes rent/mortgage, utilities, transportation costs, loan payments, subscriptions, and recurring charges. The second half of this article will show you how to cut expenses like these in creative ways that you might not have considered. 

3. Eliminate Unnecessary (Discretionary) Spending 

Every budgeting article hammers on about this, so I’m not going to. In short, this step involves taking a critical look at every dollar you spend. That morning latte on your way to work every day for a year could translate to two weeks in SouthEast Asia (flights not included). Everything adds up, like eating out, drinking alcohol in bars, and all those harmless little one-off expenses that individually seem innocuous until you tally them up. 

You don’t have to cut everything out; but make sure the discretionary expenses you continue with are worth it to you and your quality of life. 

4. Earn Extra Money

Your travel savings plan can be accelerated by bringing in some extra money. From moonlighting with a part-time job, to selling stuff you don’t need any more, to freelancing on the side, to creating a location independent career that can eventually support a long-term travel vision, how you earn your money depends on you. This step is entirely optional, and depends on your situation including your travel savings goals and time frame.

5. Save Money in a Special Account

Don’t just let your savings from the hard work of cutting expenses get absorbed into your life. Calculate every dollar you’ve saved in reducing your expenses and specifically set that aside in a special savings account. 

How to save for a vacation? Make it easy by setting up an automatic transfer of funds every week or month. Transfer it from your bank account into a high-interest savings account. The rate of return won’t make you rich (by any measure), but it is a great vehicle to set aside money in a guaranteed investment and allow it to grow at a higher rate than your bank account. 

And don’t forget about your emergency fund! Learn how to save for travel with travel savings account suggestions, guidelines for your emergency fund, and many more critical elements of your travel financial plan (including how to save money each month) here: The Ultimate Guide to Financial Planning for Travelers

How to Drastically Cut Expenses: 5 Creative Ways to Reduce Fixed Expenses 

While they may be called fixed expenses, they aren’t so fixed they can’t be reduced or even eliminated. Here’s how to lower bills and common recurring expenses in creative ways you might not have considered so you can save up to thousands of dollars each year. 

Now, if you’re new to the game and don’t know how to drastically cut household expenses, take a peek at some of the more common expense-cutting suggestions (that you’ll find all over the web), such as: 

• Sell your car (if possible)
• Stop eating and drinking at restaurants and bars
• Bring packed lunches to work 
• No more fancy lattes
• Go easy on the heating/air conditioning 
• Reduce power bills with energy-efficient bulbs

Below are some additional cost saving ideas that aren’t quite as common but can save you up to $4,000/year. 

Ask “How Can I Save Money on My Phone Bill?” 

Great question! Renegotiate that puppy. First of all, I’m assuming you’ve already done away with your landline and that we’re talking about cell phone bills here. But if you still have a landline in addition to your cell phone, then step one is getting rid of that old clunker. 

This strategy works best when your cell phone plan is up for renewal if you’ve been on a contract. As the contract ends you’ll have paid off your phone, and assuming it still works fine and you don’t need a new one (read between the lines here: don’t need a new one), then you don’t need to be paying the same monthly rate for your cell phone plan. 

When you’re not locked into a contract, the phone company knows full well that you could take your business elsewhere, so they’re usually willing to offer you a deal (also known as a retention offer). Even if you’re in the middle of a contract, some phone companies can flex to meet your needs, but you won’t have as much leverage since it’s more difficult to change carriers mid-contract. 

Before you pick up the phone, ask yourself what you want out of the deal. What is your best-case scenario? More perks? Or less cost? What features don’t you make full use of, and what do you tend to max out? Once you become clear on what your ideal cell phone plan looks like, call in and simply ask them what they can do for you, and take it from there. Literally. Start with “how can I save money on my phone bill” and see what they come up with. 

If you really want to save a pile of money on your cell phone bill, you could get extreme like I did and cancel it entirely, and go with a super-cheap online phone number through Fongo or Hushed or Google Voice and then just use a data sim card to have connectivity whenever you’re not in WiFi range. With this system, I pay approximately $200/year for all my phone and data needs, at home and around the world. 

For more about this, check out Cell Phone Travel Basics: International Phone Plans, SIM Cards, and More

Potential Savings: $250-$1,000/year

Renegotiate Your Credit Card Annual Fee or Interest Rate

In the name of accumulating frequent flyer miles and travel hacking, I tend to have multiple credit cards on the go at any time. And most of these cards have annual fees, in return for various travel perks from generous sign-up bonuses to free checked bags to lounge passes, companion fares, and more. 

Regardless of whether you have travel credit cards or credit cards offering other perks like cash back, ask yourself whether you’re getting enough value to justify the annual fee. Could you downgrade to a fee-free card? If not, that’s okay; just determine which cards you want to keep for sure. 

Next, cancel the cards you no longer want, or ask the bank to switch you over to a fee-free card so you can keep the credit open and available in case you want to switch back to their premium card later on without having to re-qualify. 

Lastly, for the credit cards you want to keep, call in and ask if they can offer you an incentive to keep the card, insinuating that you’re considering canceling. They may or may not be able to help, but it doesn’t hurt to ask. I’ve have had the annual fee waived on two different credit cards when I simply asked.

If you’re dealing with big credit card debt, but you also pay your bills on time every month and have a decent credit score, you might be able to ask them to reduce your interest rate so you can pay off your debt more effectively.

In the market for a different travel credit card and not sure where to start? Travel Freely is free and provides customized recommendations. 

Potential Savings: $100-$300/year

Eliminate Unnecessary Apps and Subscriptions

Consumer spending on mobile apps is well over $400 billion per year (2020 is projected to hit almost $582 billion). Are you making the most of the apps you’ve paid for, as well as the ones you continue to pay for? 

Make a list of all the subscriptions you have. Did you sign up for an app that you used all the time a few months ago but have since lost interest in? Are you using Spotify enough to justify it? Do you have multiple cloud storage accounts? Make sure you don’t get charged for services you’re not making the most of. This also applies to membership websites and Patreon subscriptions. Here’s how to see what apps and pre-authorized payments you have so you can manage your digital subscriptions. 

Potential Savings: $20-$300/year

“How Can I Reduce My Cable Bill?” Consolidate Streaming, Cable, etc.

Personally I haven’t had cable tv for decades, but I’m probably not the norm. Call your cable company and (similar to your phone company) literally ask them “how can I reduce my cable bill?” See what they come back with. And honestly if they don’t reply with something reasonable, consider canceling your cable altogether. With a digital antenna, you can catch a bunch of free channels and stay apprised of any news or topical information you need. 

Also, do you really need Hulu, Netflix, Disney, HBO, Amazon Prime, and every other streaming channel? Probably not. Even if you’re a watch-a-holic, you could probably reduce your streaming and cable subscriptions down to a maximum of two at any one time. Decide what you use the most and what can go. You can also alternate: one year of Netflix, the next year of Hulu. 

Also, ask your friends and family what services they have. Maybe you can combine your efforts and share your subscriptions with one another. 

Potential Savings: $50-$800+/year

Cancel or Renegotiate Gym Membership

Most gyms have frozen their customer accounts during the closure. And many people have found alternative creative ways to work out. I have tapped into the abundance of free YouTube workouts and put my 10 pound weights to work. Other people are going for walks or runs. 

Now is your opportunity to consider whether that gym membership brings enough value into your life to continue paying for it when it reopens. 

Potential Savings: $600-$1,600/year

How to Lower Monthly Bills and Not Waste Your Efforts: Add It Up and Save the Difference 

If you started reading this article wondering how to save money for travel, hopefully now you’ve just uncovered a bunch of money in your budget that can be redirected. Reducing or eliminating above five fixed expenses could save you $1,020-$4,000 a year! At the upper end, that’s over $330/month that you can automatically direct towards your travel savings fund, which in and of itself could fund a pretty nice annual vacation. 

If you add in the other elements of the 5-step travel savings plan outlined at the beginning of this article, you could easily double this savings amount. 

And if you get creative about how you spend your money on travel (for example, I’m all about getting accommodation for free), then your travel savings will go even farther once you hit the road. 

But here’s the trick: it’s all give and take. Figuring out how to lower monthly bills and reducing your expenses is all well and good, but it’s a futile exercise if you don’t direct your savings to a goal that gets you excited, like (in the example of this article) saving for your next travel adventure. 

You Might Also be Interested In:

How Much Money do I Need to Travel The World? Great question. Read this: How to Create a Long-Term Travel Budget

46 Hidden Travel Costs You Can Avoid To Save Money (like airline fees, hotel fees, & more)

How To Travel On A Budget: 14 Creative Tips That No One Talks About

This post How to Save Money to Travel By Drastically Cutting Expenses appeared first on The Professional Hobo. Please click through to read it in full!

In this article I will cover the following:

• Mystery Shopping Basics
• Travel Mystery Shopping Details
• My Experience as an Airline Mystery Shopper / Airline Secret Shopper
• How to Qualify and do a Good Job as a Mystery Shopper
• Travel Secret Shopper Downsides
• Mystery Shopping Tips
• Mystery Shopping Scams
• Mystery Shopping for More than Travel
• Resources for More Information

This one’s another doozy! Sit back, and learn everything you need to know about becoming a mystery shopper.

Check out my Travel Lifestyle Guides for more ways to earn money remotely, spend it wisely, and balance the two so you can travel as long as you wish, in a financially sustainable way. 

Mystery Shopping Basics

Companies will use mystery shoppers (also known as secret shoppers, or in “the biz” they’re known as “inspectors”) when they want to perform quality control on their daily operations or understand how employees are behaving under normal circumstances (because of course if the boss is watching, the wheels have extra grease and everybody is in peak performance mode).

So they hire mystery shopping sites and companies who conduct studies to aggregate and report data collected by mystery shoppers.

Cue in you and me.

We go into these places of business on a secret assignment on behalf of the mystery shopping company. Sometimes we need to ask specific questions of employees, or go at a certain time of day, or buy/order a particular item.

We observe everything and fill in a detailed report which we submit to the mystery shopping company. In exchange for our efforts, we receive compensation; compensation can come in the form of a (partial or full) reimbursement, or pay, or both.

Travel Mystery Shopping

I remember meeting a fellow in Amsterdam who was an airline secret shopper for KLM. He flew around the world regularly, in exchange for providing feedback on the experience.

I was mesmerized. I wanted his job! I decided that mystery shopping airlines would be my next career.

So I asked him how to become a mystery flyer. Turns out, of course, it’s not that simple.

His gig was special, as he was employed directly by KLM for his expertise, given that he was also a hotelier and his name and status carried some weight. Even so, he wasn’t making money with this gig; it was just a way to subsidize his flights.

Even though I wouldn’t be able to follow exactly in his footsteps, as luck would have it the following year, I was contacted by a travel mystery shopping company called EvaluateIt by SQM (SQM stands for Sensors Quality Management). They invited me to apply to be a travel mystery shopper for them, and, well…..keep reading.

My Experience As an Airline Mystery Shopper / Airline Secret Shopper

In 2014 I flew return from Toronto to Lima (Peru) for a 50% discount, as an SQM secret shopper. Here is my SQM mystery shopping review and experience.

When I signed up as a mystery shopper with EvaluateIt by SQM, I gained access to view available travel mystery shopping assignments, which included airfare around the world, hotels and resorts, long-distance train and bus fares, and more.

To be honest I was a bit ambivalent about becoming a travel mystery shopper; my particular brand of lifestyle travel at the time wasn’t a great fit for the sorts of gigs they had available. And to be honest, even after my friend’s KLM testimony, I still wasn’t entirely sure that it was legit. It almost seemed too good to be true.

See also: Here are the Most Common Travel Scams, and How to Avoid Them

I received email notifications when new assignments or categories of assignments became available, so I didn’t have to lurk the site all the time. (Although if you are serious about mystery shopper travel, then check the site regularly since they tend to send email blasts only when they have special deals or are having trouble filling all the mystery shopper jobs. Many of their opportunities sell out fast from being in-demand and/or high-season.)

Finally, a flight shopper assignment came up that was perfect for me given my planned trip to Peru, so I applied for it.

Once approved, I paid EvaluateIt by SQM directly for the tickets (which is not always the case; in many other instances you book the travel directly with the airline/hotel/transportation provider/etc and get reimbursed).

I had to pay full price for the tickets; you receive the 50% reimbursement only after the mystery shopping assignment is complete and the report has been submitted and accepted.

You might also be interested in: 46 Hidden Travel Costs You Can Avoid

Mystery Shopping Airfare: What I Had to Do

Although not totally onerous, I did earn my airfare reimbursement.

Prior to flying, I printed out a 5-page detailed questionnaire. I also saved an electronic copy of my boarding pass, which would eventually be submitted with the report/questionnaire.

Although the actual report was submitted online after the fact, I found it necessary to work off the printed sheets during the flight due to the level of detailed observation required. (And of course, none of the airline staff can see the questionnaire or know that you’re a mystery shopper, so I had to work as discreetly as possible).

Within three days of taking the flight, I went online and submitted the questionnaire and my boarding pass.

That’s it.

Had I booked a one-way flight, I’d have received the 50% reimbursement from EvaluateIt by SQM after submitting the report. But because I booked a return flight, I didn’t receive reimbursement until I had completed the last leg of the trip and submitted the corresponding report.

What’s Covered in the Mystery Shopping Questionnaire

The mystery shopping questionnaire required me to evaluate all aspects of my flight experience, including boarding and pre-departure, cabin service, duty free service, cabin crew grooming, food and beverage, cabin environment, irregular situations (like delays), pre landing, and after landing.

Each category had 10-20 yes/no questions, and space for a (required) overall rating and detailed explanation of notes pertaining to that category.

It’s a pretty serious undertaking to be honest! Though rumour has it that the more you mystery shop, the easier it gets because you know what to look for.

Would I Fly as a Mystery Shopper Again?

Yes. EvaluateIt by SQM has offered lots of long-haul mystery shopping airfares around the world over the years. To get a 50% discount off these flights is huge value, and even the requirements of a detailed report represent great value when you consider the savings.

While it has been quite a few years since my initial airline mystery shopping experience, I’ve remained on the lookout for opportunities. Again because of the nature of my travel lifestyle, compatibility has been an issue. But now that I have a home base in Toronto, there are more opportunities for me to jump on.

In addition to flights, EvaluateIt by SQM currently has lots of bus rides, train journeys, and some big hotel chains that require mystery shoppers. Within the next year alone I hope to mystery shop some epic train trips and stay in a few swanky hotels – all heavily discounted (or even free, and sometimes with pay as well).

(For other free or subsidized travel gigs, see: The Creative Guide to Free or Cheap Accommodation)

How to Qualify and do a Good Job as a Mystery Shopper

You need to be a detail-oriented person for mystery shopping. The report I filled out was quite involved, and required me to observe and evaluate every single aspect of the flight.

In some ways it was a hassle; for example instead of just enjoying my meal, I had to note every aspect of what I was served, the temperature, quality, etc. And I’m no Instagrammer, but I had to pretend to be one and take pictures of everything too!

Although the value received from mystery shopping airfare is huge, there’s no doubt about the fact that mystery shopping is work, and it’s important to take it seriously.

And it all starts with the application process. Not everybody is accepted to be a mystery shopper, and applications are scrutinized. It’s important to use full sentences, and scour the instructions to ensure you are answering the interview questions exactly as directed.

As stated on the SQM website:

“SQM seeks mature, reliable, detail-oriented people to take advantage of these opportunities. Successful applicants will have a critical eye for detail, an excellent memory, and a proven ability to follow instructions.”

Even if your application is accepted, you may not qualify for some of the mystery shopping jobs, which require a further comprehension test to illustrate that you understand everything about that particular mystery shopping assignment and can complete it to a satisfactory level.

Travel Secret Shopper Downsides

Every rose has a few thorns, and below are some of the thorny details of travel mystery shopping.

Mystery Shopping Is Best Done Solo

Most mystery shopper airlines only allow one mystery shopper per flight. The same applies to most transportation gigs as well (eg: buses and trains). So if you are traveling with a partner, you can both apply for the mystery shopping assignment and travel on separate days; otherwise one partner will pay full price for their ticket to be on the same flight/bus/train as you, and you may or may not be able to sit together.

It’s also worth noting that when you’re “on the clock”, it requires an immense amount of concentration and observation, and traveling with somebody by your side may distract you from doing the best possible job.

The same isn’t necessarily true for hotels or restaurant mystery shopping gigs though; it’s important to see what is required before applying for the job, so you can determine how best to arrange your travel.

No Frequent Flyer Miles

As a frequent flyer mile junkie, I take pride in accumulating miles whenever I have to pay for a flight. So it was slightly painful to fly and not be allowed to use my frequent flyer memberships.

But of course, my pain was assuaged with the 50% discount, so I can’t complain (too much).

(See also: A Beginner’s Guide to Frequent Flyer Miles)

Mystery Shopping Tips

From evaluating gigs, to making your job easy, these mystery shopping tips will graduate you from amateur to pro in no time:

Only Accept Jobs You’d Normally Do (Without Pay/Reimbursement)

Remember: mystery shopping is work. It’s not a free ride! So while I’m all for applying for mystery shopping gigs that perhaps aren’t in the budget if I had to pay full-price, they need to be for experiences or products that I would like to be a legitimate customer for to begin with. Otherwise, in my opinion, it’s just not worth it.

Let’s take a non-travel-related mystery shopping experience, like eating at a certain restaurant. If you would never want to eat there in the first place, why on earth would you waste your time and energy in exchange for $X towards a meal (and maybe an extra few dollars)?

You can’t make a living with mystery shopping; at best it’s a side hustle. (At best.)

Join a Mystery Shopping Company that Resonates for You

When I was in Japan, I was encouraged by a colleague of mine to sign up as a shopper for a mystery shopping company she worked for. I didn’t even take the time to see what sorts of gigs they offered, nor was the pre-application information particularly helpful.

Once I got into the system, I realized that all of the gigs were for stores I’d never shop at and to purchase items I’d never buy if left to my own devices. Even with full reimbursement, it wasn’t worthwhile for me.

Mystery shopping needs to be for something that interests you. Why? (Hopefully you’re following the theme I’m leaning into here)….because it’s work.

Once You Do Join, be Patient

Opportunities come and go with mystery shopping companies. It depends on who their clients are at any given time. So even if you don’t see something you like right away, don’t rule them out.

In my years with EvaluateIt by SQM, I’ve seen a variety of travel secret shopper gigs with a few different airline mystery shopper jobs, bus rides, train journeys, car rental companies, hotel chains, and more. Sometimes they won’t have any gigs of interest for years, and other times there will be so many compatible opportunities you’ll have to prioritize among them.

Book in Advance

Only one mystery shopper is allowed per flight, so it pays to book mystery shopping airfare as far in advance as possible.

If you’re so on the ball that the website is not showing opportunities for dates that far out, they may just not have it up on the site yet, but will need shoppers. You can reach out directly to them to see what’s possible.

Get a Discounted Discount, or a Free Upgrade

When I flew with EvaluateIt by SQM, the particular gig I selected was a flight that offered a 50% discount off the retail cost of the flight. The airline at that time also happened to be offering a seat sale, which meant I got a 50% discount off a sale rate, which added up to a pretty spectacular deal overall.

Also, I have noticed that sometimes, EvaluateIt by SQM has offered a free upgrade to business class in addition to or instead of the 50% reimbursement. This is why it’s important to read the periodic emails they send out; you never know what’s on offer!

Calculate the Monetary Value in Relation to the Work Required

Higher priced items (like business class flights) require a more detailed report, but they also tend to yield a higher financial reward, even if that reward is in the form of reimbursement. For example, saving 50% on an $800 flight is well worth filling in a detailed mystery shopping questionnaire (in my opinion).

In order to properly evaluate and calculate the value of a mystery shopping assignment, it is important to scour the instructions and information about the assignment. Sometimes, you can find an example report so you can see the scope and detail of questions that will be asked. This will help you decide if it’s worth your time and energy.

Screenshot/Save Your Questionnaire

If you’re filling in your mystery shopping report online from chicken-scratched notes such that the online submission is your only full copy, take a screenshot of each page as you complete it, or better yet, copy and paste each written answer into a separate document.

It’s better to be safe than sorry, trust me! Because of a poor internet connection when I arrived in Peru, I lost everything I had painstakingly transcribed and entered into the system and had to redo it from scratch.

Use an Online Fax Service

You may be required to fax your receipts or other documents to the mystery shopping company. I know right? Who even has fax machines any more?!

The good news is there are free programs (like Fax Zero or GotFreeFax) that allow you to send faxes from an email address. Alternately, you may be able to find an app that does the same thing.

(See also: Best Travel Apps)

Mystery Shopping Scams

If a mystery shopping assignment or company seems too good to be true, that’s because sometimes, it is. Mystery shopping scams exist. Here’s what you need to know.

See also: 24 Classic Travel Scams

Mystery Shopping Fee Scams

There should never be a fee to join a mystery shopping company, or apply for a specific assignment.

In many cases, you may have to purchase your item/tickets up front, since you may be evaluating all aspects of the customer experience, starting with the purchase. That’s (usually) legit. And yes, it can be a leap of faith that you’ll be reimbursed you when the time comes. That’s another reason why it’s important to only do mystery shopping gigs that you would normally do anyway (as explained above in the mystery shopping tips).

In other cases, you may be purchasing the tickets directly from the mystery shopping company. This is what happened when I was an airline mystery shopper for EvaluateIt by SQM; I paid them directly for my flights, and I paid full price. But if that makes you nervous, consider that when you pay with a credit card, you are protected by the credit card issuer and if it turns out to be a scam (which it won’t with EvaluateIt by SQM), you will have recourse.

Cheque Cashing Scam

There has recently been a mystery shopping scam going around for cheque cashing. The “mystery shopping company” sends you a cheque (for example $800) that you deposit to your account using a service like Western Union. Then you are instructed to wire only a portion of those funds (eg.: $500) back to the mystery shopping company; you are allowed to keep the rest as your “mystery shopping fee”.

Trouble is, you have to wire them the funds immediately, before the initial cheque clears. And of course, the cheque is bogus so it never clears. You’ve just been scammed for all that money.

Email Scam

Email scams are everywhere. Whether an email looks like it is coming from your bank, or your mystery shopping company, or any other institution, if you have to click on something within the email and provide any personal information, treat it with great suspicion.

Better to open up your browser and log directly into your profile and find out the scoop. In general, don’t click on (unsolicited) email links.

The MSPA (Mystery Shopper Provider’s Association keeps a running tally of scams that have been reported to them. Check it out here.

Mystery Shopping for More than Travel

EvaluateIt by SQM offers solely travel-related mystery shopping opportunities such as flights, transportation, hotels, and resorts. And all their gigs are solely discount opportunities.

But EvaluateIt is a subsidiary of a larger parent company: SQM, which has a much broader selection of mystery shopping opportunities, including everything EvaluateIt offers, plus restaurants, oil changes, massages, haircuts, gym memberships, banking, clothing, attractions, parking, and more.

Some of these opportunities work on a reimbursement basis (like EvaluateIt) and/or might include a shopper fee – which means you’re actually paid (anything from $5-$100) for performing the mystery shopping assignment in addition to being reimbursed for your related purchases/expenses. The more complicated the assignment, the more you’re paid.

SQM also has a couple of travel-related mystery shopping hotel gigs that provide a free stay plus a shopper fee. Because there is pay involved, you won’t find them on the EvaluateIt site.

Thus, if you are only interested in travel mystery shopping, sign up for EvaluateIt by SQM.

If you want to see the above gigs, plus other non-travel-related opportunities (and the odd paid travel assignment), then sign up for SQM.

But just to be clear, you will never get rich with mystery shopping alone.

Check out the resources below to find other providers.

Mystery Shopping Resources

Coyle Hospitality – While there are many mystery shopping companies, I mention Coyle specifically because they offer some great hotel gigs, as well as cruises, some airlines, and upscale restaurants. All assignments pay a fee plus reimbursable expenses as directed by the client. I don’t know what is required of the mystery shopper to understand how good a deal it is (or isn’t).

Mystery Shopper Providers Association – You can search for mystery shopper companies in your area (though not all will be listed, because the association requires a fee for listing). They also aggregate some specific mystery shopping listings on their job board, keep a tally of scams, and provide some tools and tips.

This post How to Get 50% off Airfare With Travel Mystery Shopping appeared first on The Professional Hobo. Please click through to read it in full!

Brace yourself. None of us are immune (that is, until you read this article and learn from our travel mistakes). Once you know what to look for, you can spot these travel scams a mile away, and with the tips here, you can avoid them expertly.

(See Also: Travel Security: how to protect all your valuables when you travel)

PICKPOCKET AND THEFT SCAMS

Pickpocketing can happen anywhere in the world, in both developed and developing countries. It can even happen in your home town! It just tends to be that targets for pickpocket and theft are foreigners by virtue of often being in touristy or crowded places (and also characteristically distracted).

So read up on the below experiences, and take heed, every day.

Scuffed Pants / Dropped Keys Distraction Pickpocket

Michael Brein earned his PhD in social psychology, and is dubbed “The Travel Psychologist”. He is an author, lecturer, consultant, travel storyteller, adventurer, and publisher of travel books and guides.

The scam he describes here has been adapted from his recent book, Travel Tales: Michael’s Best 150.

“I was riding the Madrid metro, standing in the center part of the car. I was all loaded down with an attache case, backpack, and rolled up posters. I had stuff in my hands and in all my pockets as well. I was, for all intents and purposes—totally oblivious.

Suddenly I noticed my trousers had been scuffed, apparently accidentally scuffed by a seated passenger’s shoe on my left.

My gaze focused now on this person taking hold of the scuffed portion of the pant leg in one hand, and brushing away the scuff with the other, all the while maintaining an apologetic demeanour. I turned around and noticed two other guys standing directly behind me, too close for comfort.

The Metro came to a stop. The door opened. The three guys—apparently Spanish gypsies—immediately flew out the door, running. I suddenly realized that I had been a pick-pocketing victim!”

Michael was saved by a pickpocket proof safari style jacket with no less than 22 pockets; the perpetrators didn’t have enough time to find a pocket with something valuable in it before Michael was on to them. But he’s still quite sure this was a pickpocket trio, and in fact saw them a few days later on the metro, pulling off a similar scam on somebody else. This time, they dropped keys on the floor as their distraction.

How to Avoid this Pickpocket Scam: Always scan your surroundings and be aware of everything happening around you. And if you find somebody distracting you, snap out of it! Look where they don’t want you to, to ensure you’re not being robbed.

It also helps not to look like a wealthy tourist. Leave your expensive jewelry and watches at home, and keep your expensive camera under wraps. Pickpocket proof clothing helps too.

Pickpockets Masquerading as Aggressive Vendors

John Z. Wetmore produces the cable television series, “Perils For Pedestrians“, which looks at problems confronting pedestrians around the world, and solutions to those problems. He watched as his friend was pickpocketed in Bogota, Colombia.

“A friend of mine fell victim to pickpockets while I was following him just ten feet away. Two young men pretending to be street vendors aggressively pushed their wares, then quickly disappeared. When we got back to the hotel, he discovered that his jacket pocket had been unzipped and his phone stolen.

There were a couple of red flags. The pickpockets were way more aggressive than normal street vendors, who would have given up much sooner when rebuffed. They also were bumping and jostling him, which meant that he was less likely to notice when they entered his pocket.

The natural reaction when confronted by an aggressive vendor you don’t want to bargain with is to ignore them, which works to the pickpockets’ advantage. Perhaps they might have been discouraged if he started looking directly at them, or had started yelling loudly at them. Fortunately, the phone in his outer pocket was a decoy phone — an old model that was worth very little. His real phone was safe in an inside pocket.”

How to Avoid this Pickpocket Tourist Scam: In retrospect it was obvious what was happening above, but in the moment not so much. Heed any wee red flags that pop into your head. While there is some strength in numbers, this particular scam happened while two friends watched! Be aware, and don’t let anybody hassle or bump you.

Also, consider keeping a decoy wallet in your outside pocket with whatever spending money you plan on using that day. Keep your real wallet and cards further from prying hands.

Crowded Bus Pickpocket

James Ian has traveled to 78 countries and all seven continents. Mostly safely. He now blogs at Travel Collecting, helping people have interesting and meaningful experiences when they travel.

He was unfortunately parted with his phone on a Guatemalan bus.

“I was sitting near the back of a crowded bus in Guatemala. There are bench seats and people squeeze together tightly to fit in. The buses are old converted U.S. school buses and the back of the bus also opens up as a second door. The guy on my left was squeezed up against me (which was not unusual) and was wriggling a bit (which was also not that unusual, since there were people trying to move up and down the aisles).

We stopped for a while, and he wriggled some more, which I thought was a little odd since no one was walking past, but it was crowded, and he smiled at me when I looked at him, which made me feel more relaxed. Then he suddenly stood up and jumped off the bus out the back door.

That’s when the warning bells started clanging loudly. We had been stopped for a while – why didn’t he get off the bus when we arrived? I checked for my phone, which had been in my left pocket, and sure enough, it was missing. I had been pickpocketed!”

How to Avoid this Pickpocket Scam: Don’t keep anything in your pockets when you’re on the move. Also, if you’re on a crowded bus and somebody is wriggling around next to you for no apparent reason, check for foul play.

(See also: 7 Travel Mistakes I Made in Guatemala)

Distraction Theft Scam

Alex Trembath and Lisa Pool are a couple from the UK to took a year off work together in their 30s to travel the world. Now, they run Career Gappers, which inspires and equips people to take their own travel career breaks. Shortly after arriving in Buenos Aires, Argentina, they fell prey to a classic distraction theft scam; this one involving bird poop.

“While we were walking through a park, I was just in front of Lisa. Somebody threw a substance that looked like bird mess on my backpack – neither of us saw them throw it, and we thought it was genuine. A few steps ahead, a woman appeared, saying she had seen what had happened and offered to help us clean up the mess.

We stopped at a bus station to take the bags off. In order to get to our big backpacks, we first needed to take off the small bags on our front. These bags contained most of our valuables. The moment we took off the small bags, the woman turned us around, distracting us while someone else grabbed our bags and gave them to someone waiting in a taxi, who drove off with them.

It all happened in a few seconds and as soon as we realized, it was too late. We lost our passports, lots of cash, laptops, cameras, e-readers, sentimental items and much more.”

(Learn more about what happened and how they got over it here). Alex also notes that South America gets a bad rap and isn’t as dangerous on the whole as it is reputed to be; they spent five months in South America and this was their only bad experience.

How to Avoid the Distraction Theft Scam: While Alex and Lisa were aware of this travel scam, their guard was down after an overnight bus ride and the scam was professionally executed. Sadly, it’s important to beware of strangers offering help, and even more important to never lose sight of (or contact with) your bags containing valuables.

SCAMS INVOLVING NEW FRIENDSHIPS

There’s nothing more rewarding than making local friends abroad. A cultural win! The problem is, sneaky locals can use this knowledge to take advantage of unsuspecting travelers. Below are a few ways it can happen.

The Impromptu (Fake) Guide

James Ian (whose phone was stolen on a Guatemalan bus) also had a dodgy experience in Casablanca, Morocco.

“I was traveling with someone else, and we were approached by someone to be our guide. He said he could take us to a special market that not many people knew about. He took us on a public bus, which seemed like a fun adventure.

He did indeed take us to a market, though it was nothing special. As he took us into shop after shop, it eventually became clear to him that we weren’t intending to buy anything; he became increasingly agitated. 

He made money by earning a commission from the shopkeepers when we bought something, so if we didn’t buy anything, he didn’t make money. In the end I decided to buy some slippers as I was feeling uncomfortable about not buying anything. He translated for me, so after I’d agreed to a price, I gave him the money to give to the shopkeeper. Then he changed the price and said I owed more than I had just paid. I refused, and that’s when he pulled a knife and demanded the additional money.

I grabbed my money out of his hand, since he was holding it in addition to the knife, then my friend and I turned around and ran as fast as we could to get away from him and the knife. Fortunately, we saw a taxi, jumped in it and escaped safely.”

How to Avoid Being Scammed by a Fake Guide: Never use a guide you meet off the street; instead, arrange your tours through a more organized source such as a tourist office, hotel, or online. Also, never travel to an unfamiliar part of a city with somebody you just met.

Another common scam in Morocco is for young men to say there is a special Berber market that is closing, and they can take you. Tell them you went there yesterday, and they will leave you alone.

The Bar Friends Travel Scam

Stephon Owens has visited over 20 countries in Europe, the Americas, and Asia. He discovered his new friends weren’t so friendly.

“Several years ago I was traveling alone in Istanbul. I was in Taksim Square taking some photos before going back to my hotel. Taksim Square is one of the main hubs of activity in Istanbul (think NY’s Times Square). While taking photos, I was approached by a friendly middle-aged guy who I assumed was a local. He spoke broken English, but enough that I understood what he was saying.

He invited me to have a beer at a bar off of the square. It was a busy area, and I had been into a few of the bars in the area, so I wasn’t concerned about safety. I followed him to the bar, which was about a block away.

The bar was almost empty, which I thought was weird because there was a lot of pedestrian traffic outside. However, I rationalized that it was a Sunday and also the end of Ramadan. We sat in a booth, and he tried to insist that I sit my backpack on his side of the table, which is when alarm bells in my head started.

I was now aware that there was something very fishy going on so I declined to order a drink. He offered to buy me a beer, which I never touched. As the bartender delivered the beers, two women who were in the bar came over to the table and tried to squeeze into the booth. I deliberately sat on the outside edge of the booth and I refused to move over to let them in the booth. He ended up moving over to let in one of the women, and then the bartender pulled up a chair for the other one to sit at the end of the table.

I knew I was being scammed somehow and these women were involved, so I decided to leave. Suddenly my friend didn’t have money and the tab needed to be paid. At the same time, the two women chugged their glasses of champagne and claimed I was responsible for the tab. The bartender brought over a menu with inflated prices and demanded that I pay.

None of them claimed to speak English very well, so I offered the bartender the money that I had in my pocket, which amounted to about $20US. After a little protesting, they let me leave without further incident.

Back at my hotel I started searching the internet for similar stories, and apparently it is a common scam in Istanbul. Some of the more egregious stories that I saw were people not realizing for hours that they were being scammed and then having the bartenders take them to an ATM to withdraw hundreds of dollars to cover the bill.”

How to Avoid Being Stuck With a Fake Bar Bill: If you’re approached by a stranger in public, ask yourself why they’re engaging with you. It could be innocent; maybe they are studying English and want to practice with you, or they lived in your country and wish to reminisce. In both cases they’ll likely take more time to establish a basis of friendship before inviting you for a drink.

According to Stephon, he thought the local was being overly nice and he figured it was a cultural thing; he says it was never actually clear why this man befriended him, which should have been a red flag. He’s also quick to say that despite this incident, Istanbul is one of his favourite places in the world.

MISCELLANEOUS TRAVEL SCAMS

Most travel scams don’t fall into categories (that makes them too predictable). Here are five scams that these experienced travelers fell prey to.

The Inflated Restaurant Bill Scam

Becca is one half of the pair of travel bloggers and photographers behind HalfHalfTravel. They’ve been to four continents, and have traveled full-time since June 2018. Unfortunately, getting “off the beaten patch” in Cartagena Colombia wasn’t quite what Becca had anticipated.

“A new friend and I decided to be adventurous and check out La Boquilla, noted in a guide book as being a fisherman’s town and small beach.

We were treated to a private canopy tent on the beach, just feet from the water. A man came over to us, offering fresh seafood and aguardiente, the local liquor. Having not brought food, we of course said yes. He brought an entire bottle of the liquor and some shot glasses, a few beers and a small plate of whole shrimps with salsa and accompanied by fried plantains. For two hours, we sat back and relaxed, and then we asked for a bill.

Scribbled on a piece of paper was an amount of Colombian money equal to USD $90, which was absurd, considering that beers are US$1 in Colombia and aguardiente comes at US$3/bottle in most stores. The shrimp plate is typically priced at US$5 in a restaurant of any sort. The bill was hilariously expensive, but what was funnier was that we only had a total of US$70 in our pockets.

I told the man in Spanish that this was crazy, and of course, as travel scams go, he shrugged and said this is what you’re going to pay. At this point, we counted all our money and pleaded with him to let us go with paying around $75, allowing us enough cash in our pockets to take a taxi back. He agreed.”

How to Avoid the Inflated Restaurant Bill: As travelers we can be shy about asking for prices in foreign countries, especially if something is offered to us with an implied gesture of friendship – we don’t want to offend! But it’s better to be safe than sorry. Always ask for the price in advance of ordering anything from a bar or restaurant, or accepting something that is being offered to you.

Also, don’t carry all your cash with you. Becca figures if they didn’t have so much cash, they wouldn’t have been required to pay what they did. Here are some tips for carrying cash safely while abroad.

The “No Change” Grab-and-Dash Taxi Driver

Lauren Pears of The Planet Edit has traveled extensively through Asia – including India, Vietnam, Kyrgyzstan, and even North Korea. Unfortunately on arrival to Hanoi, Vietnam, her taxi ride cost way more than it should have.

“I was bartering taxis to get a fair price, when one agreed to take me for a very low fee. The driver took my bag and placed it in the trunk of the car. Happily, I got in the taxi and off we went.

When we arrived at my accommodation, the driver said ‘I’ll just get your bag out of the trunk’ and hopped out. I got out too, ready to pay and thank him for driving me. I took my bag from him, and handed over the smallest note I had (500,000 dong) while saying ‘do you have the change for this?’

With a cheeky smirk, he snatched the money, jumped straight back into the car and drove off. I was expecting A LOT of change. He had completely scammed me.”

How to Avoid the No Change Ripoff: With hindsight, Lauren figures the taxi driver’s willingness to accept the low price should have been a red flag; perhaps he surmised that having just arrived to the country, she wouldn’t have small bills (which was true).

To avoid being ripped off like this, you can insist on keeping your bag in the main section of the car on taxi journeys. Also, have small bills (ideally exact change) available, and pay before you or the driver gets out of the car.

See the end of this article for other taxi-related scams.

The Marketplace Switcharoo

When Lauren Yakiwchuk (of Justin Plus Lauren) is not traveling the world, she’s visiting local attractions in the Toronto area. In Nakuru, Kenya, she visited a marketplace and walked away with something different than what she paid for.

“I went to a market in Nakuru, Kenya, along with a small group of ladies. One was a local who knew the area well, and I also happened to be staying at her house. She reassuringly said she’d only take us to  booths operated by people she completely trusted. She also told us to haggle down the price because everything was negotiable.

At one stall, I noticed these painted wooden giraffes that I thought would be a lovely gift to bring home as souvenirs. I wanted to buy two large giraffes that were the same size, and negotiated a reasonable price. As the stall owner was wrapping up my giraffes, I continued to browse neighbouring market stands. Admittedly, I wasn’t paying much attention.

When packing up my belongings to leave the following day, I thought I’d re-wrap the giraffes to better fit them in my luggage. Lo and behold, one of the giraffes was bulked up with paper to look the same size as the other one, but it was actually a lot smaller. I’d been scammed!”

Lauren’s local friend was horrified that a trusted vendor had scammed her and promised never to visit that market stall again.

How to Avoid the Marketplace Switcharoo: Watch your items carefully as they are being wrapped. It’s common for vendors to take advantage of distracted customers by switching the product they bought for a cheaper version.

The Sob Story

Jordan Bishop is the founder of Yore Oyster, a boutique corporate travel agency. He has lived in over a dozen countries across four continents over the past five years. He currently lives in Istanbul. His first arrival in Istanbul in 2017, however, wasn’t perfect.

“In Istanbul, dozens of shoeshiners walk along the bridges looking for clients. But not all of them are interested in making an honest buck.

The shoeshiner scam occurs when a shoeshiner, walking towards an unknowing foreigner, ‘accidentally’ drops his brush behind him. The foreigner (you, in this case) notifies him that he’s dropped his brush, and in his gratitude to you, the shoeshiner sits you down and insists on cleaning your shoes.

As he does, he tells you a sob story: his family is in poverty, he recently lost his job, he’s physically disabled, etc. etc., guilt-tripping you the entire time. Then he asks for the ‘small sum’ of 100 liras, or $20 USD. If you refuse to pay, or try to negotiate the price down, he becomes angry and causes a scene.”

Shoeshiners are all over the place in Central and South America as well, and this travel scam is alive and well around the world. I had something similar happen to me in a main square in Cusco Peru, though the perpetrator wasn’t a shoeshiner; just an old man who sat down on a bench beside me and shared his sob story before asking for money. The irony is that he did the exact same thing but shared a different sob story with me the following week (he didn’t recognize me).

How to Avoid Falling for The Sob Story: If a shoeshiner drops their brush as you walk past them, simply ignore it, and refuse any offer of a free/discounted shoeshine. And if you are approached by somebody (like I was) who tells you a sob story and asks for money, ignore them, move away, or just say no. Unless, that is, you’re feeling charitable towards somebody who may or may not need your charity.

The Clothes/Shoes Donation

This is a sad travel scam indeed, especially when told this way by Sheryl Hill, who was traveling through the Dominican Republic many years ago with her little boy, Tyler.

“We took a private tour. Local children would run barefoot after the Jeep calling out – candy, candy!  Ty asked why they didn’t have shoes. The guide said they are poor. They probably only use them for school. Ty teared up.

The guide showed us a photo of his two boys and said they also only have school shoes. His photo was of two boys exactly my boys’ ages. Ty told the tour guide he could have his and his little brother’s shoes and clothes for his sons. Ty went through his suitcase only keeping one pair of swimming trunks, one change of clothes, and one set of PJ’s, and then he asked his four year old brother to do the same.

I was supportive. We walked plastic bags out to the guide. He was waiting on a rickety motorcycle. Security started coming towards us. He sped off leaving one of the bags. The security guy said, ‘You know he just scammed you’. 

As we left for the airport, we saw the tour guide selling the clothes on a street corner. I put my arm around Tyler, and said, ‘I’m sorry son’. He said, ‘It’s alright Mommy, He probably needs food more than clothes’.”

This story is even more tragic in that Sheryl shared with me that Tyler actually died approximately 10 years later while traveling with a bogus ambassador’s group study abroad program. As a result, Sheryl founded DepartSmart.com for business and vacation travel safety, and DepartSmart.org for Youth and Student Travel Safety.

How to Avoid the Donation Scam: Hard as it may be, resist the temptation to “fix” other people’s problems while traveling by making donations. Otherwise, don’t be upset if your donation is repurposed or sold.

(See also: How to be a Responsible Traveller: 5 Unexpected Pitfalls)

CLASSIC TRAVEL SCAMS

While many of the above experiences are classic travel scams, there are also many more. Check out these scam scenarios below and be on the lookout for similar circumstances while you travel.

Museum/Accommodation “Closed”

This scam is particularly common in Asia (I got suckered by it in Bangkok myself). It involves somebody (usually a taxi or tuk-tuk driver) telling you that the museum you wish to visit – or even the accommodation you have booked – is closed or under construction. They will of course have “a friend” who can help you out and they’ll magnanimously take you to a different hotel or attraction, or even to fake travel agencies.

When this happened to me and a few friends, we suddenly found ourselves locked inside a store, and we weren’t allowed to leave without buying something from their overpriced selection.

The accommodation trick is common in India, and in fact a Belgian woman made international news after being scammed and harassed while the local police stood by; she left the country after 24 hours and has since taken the Ministry of External Affairs to task. 

How to Avoid This Scam: No matter what a kind stranger tells you, don’t believe them when they say your accommodation or attraction is closed. And never let them take you to a travel agency or store.

Tuk-Tuk/Taxi Driver Switch

This is another one I fell for in Bangkok. You negotiate a taxi or tuk-tuk ride with a driver, who then passes you off to another driver to take you. Suddenly, on arrival, you owe significantly more than the rate agreed upon.

How to Avoid This Scam: If you find yourself with a different driver than the one you negotiated with, confirm the rate with them before getting in. It’s not a failsafe, but it helps.

Taxi Scams in General

There are SO many taxi scams out there, it’s ridiculous. They may tell you the meter is broken, and then charge you an inflated flat rate. Or, the meter works, but it’s rigged!

Or perhaps the taxi driver, knowing you’re not familiar with the city, will drive you in circles to inflate the charge.

How to Avoid Taxi Scams: Me? I take Uber, which eliminates every problem you might encounter with a taxi driver; the rate is pre-determined, the driver is accountable by virtue of their profile and reviews, and you both have online maps to ensure the most direct route is being taken.

But Uber isn’t available everywhere. So if you must take a taxi, protect yourself with the following tips:

• Know how long it should take to get to your destination, and how much it should cost (ask around beforehand).
• Pre-load maps on to your phone and watch where your driver is going. Redirect them if necessary.
• Use large and well-known taxi services.

Don’t normally have data on your phone while abroad to use Uber and maps? I’m a huge fan of Flexiroam international data, and in fact it’s all I use, even at home. Read more about both Flexiroam and Uber in this collection of the Best Travel Apps.
 

Taxi Ride Sharing Scam

One more taxi scam for good measure! You get into a taxi with other people in it. The driver may tell you that they’re just dropping them off (perhaps a family member) enroute. The scam could be as harmless as you having to pay for a car-load of locals with multiple drop-off points, or you could even be taken somewhere isolated and robbed of everything.

How to Avoid This Scam: Never get into a taxi with more than one person in it.

The Card Trick Hustle

This applies to any street-magic, shell game, or card tricks you pass by. You’re invited to play; you make a small bet or two and win. Then, the stakes are raised, and you lose – big time.

How to Avoid This Hustle: Hopefully you’re not a sucker for gambling, because the best way not to lose is not to play.

Pickpocket Signs

While this isn’t exactly a scam in and of itself, it’s a way to make you a target. Pickpockets like to hang out near street signs that warn tourists to beware of pickpocketing. What do you do as an unsuspecting tourist when you see this sign? You pat all your pockets to ensure your valuables are right where you left them, of course….thus telling thieves exactly how to rob you.

How to Avoid This Scam: Never check your valuables in an obvious way, and especially if you just saw a pickpocket sign!

Petitions

This scam may appeal to your sense of social responsibility, but don’t let it. Somebody thrusts a petition in front of you (often aggressively). Perhaps you’re in a foreign language country and they passionately tell you their plight in rapid-fire local language. You sign the petition just to get away, but unfortunately it’s just a precursor to a request for a “cash donation”, and if you refuse they create a scene.

How to Avoid This Scam: Don’t sign petitions, especially in public on street corners.

Friendship Bracelets, and Other Bogus “Gifts”

In addition to the friendship scams listed earlier, there is a whole world of bogus friendship offerings, exploiting every travelers’ desire to meet friendly locals. A stranger may offer you a hand-made friendship bracelet, or a hat, or a sprig of herbs, etc. They’ll likely be pretty aggressive and will try to force you to take/wear it. These people are not your friends! As soon as you take the “gift” they will ask for money and will create a ruckus if you refuse.

How to Avoid This Scam: Nothing is free. Don’t accept gifts from strangers, even if you need to aggressively refuse. Unless, that is, you are prepared to (over)pay for whatever is offered to you.

“Did you Drop…”

Somebody approaches you and asks if you dropped this ring (or whatever). You say no. They say it’s expensive and offer to sell it to you inexpensively – a win for everybody, right? But of course it’s fake.

How to Avoid This Scam: It’s an obvious scam once you know about it. Anything designed to get you to pay a stranger, in public, should be skeptically scrutinized.

Currency Exchange Scams

I fell for every currency exchange scam in the book in one short morning while in Kuta, Bali! Read the (funny) story about it here for more details of each scam. In short, here are the common currency exchange scams.

At the currency exchange desk, they start in with calculator action so rapid you have no idea what they’re doing. In the end the calculator displays a number that is much less than what you should be getting, and if you’re not familiar with the exchange rate you’re none the wiser.

Perhaps the calculator will come up with the right number, but but in counting out the cash (which in this case they dole out in small denominations) they use sleight of hand to pocket a chunk. I knew about this scam, and watched the guy like a hawk and still didn’t see him pocket half of the bills! (I was so impressed I’d have let him get away with it if he weren’t trying to scam me for so much money).

They may subtly tear your bill (or exchange your bill with a torn one using sleight of hand), then tell you that they can’t give you the full rate for it.

Calculator confusion. This, as happened to me in Bali: Instead of 1.2 million rupiahs, the calculator displayed 1.19. He counted out one million in 100,000-denomination notes. Easy peasy. Then, with exaggerated flair, he counted out three 5,000 notes, and two 2,000 notes. This confused me but with all those 0’s floating through my head I couldn’t pin down the problem. I looked at his calculator again, which had by that point changed to 1 million 19 thousand instead of 1.19 million; 180,000 rupiahs ($17) less than I should have received.

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