This website is supported by its readers. If you click one of my links I may earn a commission. I am also a participant in the Amazon affiliates programme and I will also earn a commission from qualified purchases.
Working from a home office, Easily the dream of many people (myself included) I mean let’s face it there is no better feeling than beating the commute and rolling out of bed at 9am. One of the things that really surprised me then when working remotely was how expensive things became.
Working remotely has a number of expenses that come alongside it. Although you may be saving money on your commute, you will spend significantly more on your home bills such as gas and power. Non-monetary costs can also be picked up when working remotely, such as the social stigma of not working from a fixed office space.
So what exactly are the hidden costs of working from a home office? I’ve listened 21 in the table below:
| Cost | Type of cost |
| Electricity | Monetary |
| Internet | Monetary |
| Childcare | Monetary |
| Insurance | Monetary |
| Stationary | Monetary |
| Courses | Monetary |
| Fuel | Monetary |
| Mortgage payments | Monetary |
| Salary | Monetary |
| Tax | Monetary |
| Mobile phone | Monetary |
| Transport | Monetary |
| Bank Costs | Monetary |
| Furniture | Monetary |
| Time | Non-Monetary |
| Career | Non-Monetary |
| Social stigma | Non-Monetary |
| Health | Non-Monetary |
| Productivity | Non-Monetary |
| Burnout | Non-Monetary |
| Work Life balance | Non-Monetary |
So which of these end up costing the most? And is there a way to plan ahead to avoid these costs? Keep reading to find out more
(Just a heads up a lot of people reading my blog are in the process of designing their own home office. If you want to save some of the painstaking time I did in designing my office, you can find my recommended products here)
What are the costs when you work from a home office?
Luckily enough for myself I’ve had the luxury of being able to work from my own home office for around 3 years. This varies from one day to week to almost a few weeks depending on the time of the year.
Before we go into the above 21 types of expenses you probably want to explain why I put do the two types of costs below:
- Monetary
- Non-monetary
Well to put it bluntly, everyone always thinks of the monetary costs and the direct amount of money going out of their account when they have to pay for something like a train ticket. What is often not said is the time and qualitative costs to working from home.
I mean if I were to take out 5 years working from my home office only to have it not pan out, I’d probably want to be made aware of that beforehand.
Let’s look at the costs associated with each of these starting with monetary costs.
Heating
One of the biggest expenses that will increase when you start working remotely is your heat.
The simple fact is because you will be spending more time at home it is a lot more likely you will use things like heaters or cookers when you’re at home.
Heck the price of heating oil seems to be increasing every year so make sure you take this into account when working remotely.
What’s the cost: $661 per year
Electricity
Without a doubt the biggest expense that will be coming out of your pocket every month when you work from your home office will be your electricity bill.
Heck not even your electricity bill your power bill in general seeing as most people get both their heat and gas combined into one provider.
I mean think about it, most people will end up spending at least 4 hours a day on their phones or in front of their screens. This doesn’t even indicate the extra 8-12 hours you will now be spending working from your home office meaning your prices will be way more expensive.
I mean just picture it for a second, when you’re at work you have the luxury of all your devices getting plugged in there meaning you won’t have to worry about it. Your kept warm by the office thermostat, Unfortunately all of this changes
Once you’re at home this goes out the window and you might find you end up spending way more.
The EIA suggests that the average household uses 914kwh per month. Expect that to be at least one third higher when working from home.
What’s the cost: $2000 per year
Internet
So you might be thinking, hang on a second Fehed. Why can’t I stick to the internet I currently have?
At first glance this won’t be an issue whilst you get used to working remotely from your home office.
It’s likely though that eventually your office may need more bandwidth to cope due to the increased browsing time.
My suggestion would be to monitor this regularly as a number of internet providers have yearly deals. You can very easily jump from provider to provider, year to year keeping your costs down. A good place to start for this will be Moneysupermarket.com which keeps you updated on regular changes in prices.
What’s the cost: $60 per month
Childcare
So most people who have work from their home office might not have considered this, but it is something I hear again and again.
You see even though you’re working from home and will be spending more kids its very easy to fall behind on your workload. Or have your kids bust in like a bbc news report.
Although this is something you won’t have to consider right away as your time gets more full you might need to pay for childcare for a few hours where you just hammer out a bit of work.
What’s the cost: $800 per month
Insurance
Okay what?! It’s likely that you already have house insurance so you won’t have to worry about this but if you’re self-employed this is definitely something you need to consider.
I mean let’s break this down. If you have to have a meeting in your office and something goes wrong, maybel a colleague’s slips in your office and hurts themselves, you need to be covered from a legal standpoint. Now i’m not an insurance professional but I found a great video below from Shine Insurance.
What’s the cost: about $300 per year
Stationary
This is probably one of the things people forget the most when working from a home office. I know I did!
When i did start working from my home office one of the things that I hadn’t considered was stationary because my job was paperless. I mean I think the last time I actually remembered to buy stationary was in primary school.
You soon realise however that every job needs a degree of stationary, hopefully the list below helps.
- Pens
- Pencils
- Notepads
- On hand calculator
- Journal
- Highlighters
- Ringbinders
Now if you want my specific recommendations feel free to check out my resource page here.
What’s the cost: under $100
Courses
So a lot of people ( especially millennials) who work from their own home offices have their own business. I mean according to Comcast we are the most entrepreneurial generation yet
With the advent of technology and the internet people are becoming more successful and as such learning is super important. Most people who have “made it” take online courses to help them get there.
Now don’t get me wrong there are a lot of doggy Dans out there trying to scam people so do be careful. My opinion is never to spend more than $500 on a course. Trust me I’ve seen some courses cost upwards of $10,000 which is just ridiculous.
My recommendation for a course would have to be income school project 24 which you can find more about here.
What’s the cost: between $200 – $500 per course
Fuel
This is probably another one you’re surprised is on the list. Even though you won’t have a commute to worry about you will still need to pay for it.
For example let’s say you have to pop out to grab something to eat, or you get called to your kids school. These costs add up, you might even find that family and friends might ask more knowing that your cushied up in a home office .
83% of Americans currently drive frequently and the same will likely be said for you.
What’s the cost: $50 per month depending on where you live.
Mortgage payments
Again another one to consider if you are self employed. There are a lot of rules when it comes to mortgaging, heck if your office is completely based there some lenders will even want you to take out a commercial loan.
Now I am not a financial adviser. However crunch has a number of great articles talking all about the rules when it comes to mortgages when you are self-employed. You can start reading them here).
The gist of it is, just make sure you speak to your financial adviser before you make any decisions about being self employed and your home will be used as your main office.
What’s the cost: Entirely depending on your provider.
Salary
This can work on both fronts.
Let’s say you’re employed by an organisation. They might actually reduce your salary as you are now not community to work. Jobs offered in London for example sometimes offer a higher salary to take into consideration the commute.
If you’re working from home, your employer could see fit to offer you a lower salary.
On top of this if you are self-employed, eventually you will need to have employees, either freelanced or not. Meaning you will need to know this week in advance before taking the plunge and starting your own business.
So what are the types of jobs most remote workers hire:
- Copywriters
- Accountants
- Marketing professionals
- Programmers
What’s the cost: these all fall on a scale from a few cents per word for a copywriter all the way up to thousands for a programmers project.
Tax
Tax will typically cost around 20% when you are self-employed for your cooperation plus upto 40-50% of your earnings should you pay yourself a salary.
This is a lot of money the government takes off you.
But did you know there could be other tax costs you need to pay. For example sales tax or VAt will be needed once you hit a certain income threshold, so having these costs setup will be super important.
The good news if you work for someone else from your home office? You can sometimes claim this back on your expenses such as your heating bills, gas bills, internet bills etc for the proportion you work in – depending on a few factors. of course
What’s the cost: 20-60% of your income
Mobile phones
No not your screen which if it’s anything like mine is currently cracked and has weird gunk down the back of the case.
Similarly to your internet provider eventually you will find yourself making more calls/conference calls using more phone data just to do your day to day tasks.
What was once a responsibility of someone else now falls on you.
You could potentially ask your employee to see if they will provide you with a device ( as most now do) but you may need to consider a brand new plan.
So what is the best plan? Reviews.org have a great list.
What’s the cost: $40 per month
Transport
Even if you don’t drive at some point you’re going to have to step out into the unknown.
It could be for a meeting, a day where you have to go into the office or even prospecting for business, but us introverts will have to make do with hopping out every now and then.
So even though your weekly cost of transport will be less, it will still be a cost you need to consider. How can we avoid this cost?
Plan, plan and plan again. Train tickets in the UK for example can be as much as 50% cheaper then if you were to get them the day before. You could even look into things like railcards or other transports hack to further save you money
What’s the cost: about $50 per month (depending on your state)
Bank Costs
So I know a lot of this is focused on people who are self employed but the truth is almost all people who are self employed start working from home.
As such there is another major expense you have to deal with.
Bank costs. So you will need to set up a business bank account when you do eventually start your business with most of them charging a monthly fee to use them
One of the way you can get the best out of this is by using the old trick we learnt from internet providers and switching them regularly to ensure you get the most bang for your buck
What’s the cost: about $10 per month
Furniture
Easily the most obvious cost when it comes to setting up a home office hence why I wanted to put this near the end of the article.
Home office furniture can significantly eat up your costs year after year. I mean the amount of time you will be using your table, pressing your butt against your chairs cushion, eventually this stuff wears out.
Again by planning ahead or using sites like Freecycle you can really find some great offers when it comes to office furniture.
Once again if you want my recommendations you can visit my resource page here.
What’s the cost: about $500 per year
What about the non-monetary costs
Let’s be honest if you made it this far down the list you probably have forgotten about these by now right?
Like I said earlier these are super important to consider as they can have a detrimental effect on you in the future.
Time
Easily the most important cost when working from a home office. At the end of the day try as you might you might find yourself working more than someone who works in a traditional office, spending all your time cooked up in one room in your house.
You have one life and you want to make sure the time you spend working is spent as well.
A great book that talks about this is The Four Hour Work Week by Tim Ferris which really helped me balance my work life balance and get it to a point where I can get enough done and still enjoy the finer things in life.
Career
Probably one of the areas that are a little bit controversial and almost a dirty secret.
If your boss doesn’t see you in the office every day they are less likely to have built up a strong relationship with you.
As such when your business is going through a tough time you might find yourself on the chopping block or looking for a promotion.
The same could be said if you’re self employed, especially if you put ten years into something full time and it doesn’t work out, that could potentially push your career back by years.
Social Stigma
“I bet you just watch Netflix all day”
The sad fact is that most people who work from home or have a home office just don’t get the credit of actually working. The same can be said if you genuinely love your job. According to Reward Gateway about 73% of people are not happy in the workforce and sometimes they can take it out on you.
Sometimes you do need thick skin just to get by.
Health
I am by no means a doctor, but there are clear health impacts with working from a home office.
Not only do you find yourself overworking, you might find you slip on your health.
On top of this, social interactions also fall off the face of the earth. You really might end up missing your colleagues.
If you are self-employed you also have the worry of your own health insurance and other benefits that you have to worry about.
Please don’t try to do it all by yourself and seek help when you need to.
Productivity
Like we mentioned earlier, remote workers are more productive than their office working counterparts.
That being said there are still going to be occasions where you just can’t get things done. Routine can often go out the window and during times like this your productivity will drop, regardless of how much of a workhorse you are.
My solution, journal, take note and plan out your day effectively so you won’t have anything to worry about.
Burnout
Finally we reach burnout.
There just comes a point where you just can’t give anymore, you’ve given 100% for the past few hours and can’t bear the thought of crafting that email.
One of the reasons why I now go into the office a few days per week is just to get my mind right,catch up with the guys and just generally feel energised about my company’s mission.
The walls can definitely close in on you when working from a home office
Work-life balance
We alluded to this earlier on but work life balance can go out of the window as soon as you start working from your home office.
You might think the opposite to be true but people who work remotely are way more productive than their counterparts. Mainly because they take fewer breaks and sometimes work into the night.
Make sure you set healthy boundaries for yourself and don’t get carried away by the hustle life.
BONUS
Water and food
Yep, there is a good reason I left this one for last, I guarantee you will be drinking a hell of a lot more water than you used to in the office. Which means a higher water bill every month
Also, as bad as it is to say, as humans we love to graze, expect your wallet to get thinner and your food bills and waistline to get bigger.
My recommendations
As you can see working from a home office isn’t a decision you should jump at but takes real thought before coming up with a decision if it is best for you.
There are so many costs associated with this but in my opinion it’s still to go for it.
Although there is no getting around these expenses, You will find yourself saving way more money then you will be spending. Imagine being able to go on that holiday every year instead of every other year.
On top of this all the amazing experiences and growth you will have on your remote working journey are priceless and after all, Isn’t that a cost you can’t afford to miss out on?
Finally a lot of people reading my blog want to know what products I recommend for a home office/remote working. You can find out my recommendations here and learn how I make money whilst working remotely on the side here. If you want to brush up on the differences between working remotely and flexible working you can check out this blog post which delves into what the subtle but big differences are.
Fehed.
The content on this on this site has been written by Fehed Nicass who has over a decades worth of experience in sales and has worked remotely for the past 2 years.