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Working remotely, let’s face it, everybody has had the idea at one time or another to be sitting on a beach living that digital nomad lifestyle. Heck half the time it isn’t even about the beach – I know I would happily be cozied up in my home office working remotely from there. There are however a couple of things people need to consider, Mainly, the hidden cost of a home office.
So what are the hidden costs of a home office? Luckily I’ve put together a complete list of 20 I feel everyone needs to consider. Before we go into these though let’s explore the different types of expenses.
(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 hidden costs of a home office?
So I’ve had the pleasure of working remotely from my home office for about 3 years in total now. Like
One of the things I’ve picked up after speaking with a few of my friends is that the costs associated with working remotely can be associated into 2 main categories
- Monetary
- Non-monetary
For anyone unfamiliar with these I’ve explained them in more detail below:
|
Type |
Explanation |
| Monetary | Monetary expenses relate directly to the actual money cost or dollar amount that are going directly out of your account. This can be easily quantified |
| Non-monetary | Non-monetary expenses are expensive which are much harder to quantify but still have an effect. For example someone who works remotely might be taking time out of the career and so this would be a non-monetary cost. |
Let’s look at the costs associated with each of these starting with monetary costs:
Gas
Regardless of if you work from your home office or a hostel in southeast Asia, at some point you will need to keep yourself warm (yes my american friends I’m talking about heat not fuel, more on that later).
A lot of places around the world don’t run their heat off a grid and instead use something like a kerosene heater.As such you might need to buy one of these for your living quarters in your hostel. (there is a great Youtube video about it here)
What about if you stay local and work from your home office? How much more gas will you use? I mean one of the other things to note is as you will be spending more time in your home office, you’re likely going to be spending a lot more time, especially in the winter with the heating on.
Hopefully this infographic from statista should be able to help.
What’s the cost: $1215 per year
One of the few good things I can say about this is that if you do decide to stick to the good old USA, most of your heart will come out of your electricity bill instead of seperate gas. Speaking of which …
Electricity
You can’t spell gas without electricity… Well actually you can. That being said, one of the biggest increases you will see when working remotely, especially if you are working from your home office, will be electricity.
I mean just thinking about it, when you’re at work your computer, phone, heck even your fitbit if you can sneak your usb in will all be plugged into your workplaces power source.
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.
On top of this, A lot of western countries will not only be using their electricity for power but also for heat too.
The good news, if you are working remotely on the other side of the world, it’s likely your accommodation will have this price included. Mainly because a lot of the hotspots for remote working ( hello Thailand)
What’s the cost: $2000 per year
Internet
At a first glance, you might think that you can stick with the internet you currently have, and in some cases you would be right.
That being said most people who have the luxury of working remotely or from their home offices have done so because of setting up their own businesses. As such it’s like you’re going to be communicating with people over video calls all over the world and sooner or later you might find your current bandwidth just doesn’t hold up.
Make sure you have an idea of how much data you need for the month ahead to keep on top of any unwanted bills.
What’s the cost: $60 per month
Childcare
One group of people who often get overlooked when talking about remote working are parents. You see usually it’s some millennial who got lucky betting on futures who you vision as working remotely but there are a growing number of parents who work remotely.
In fact flexible working is growing in the workplace, mainly to help parents who work remotely.
So why the cost of childcare? Well although you don’t need childcare everyday, there will be a few times every month where you need to either just focus up on an important task, or find that you have a meeting you need to be present for. Again if you can plan this stuff out in advance you should be fine.
What’s the cost: $800 per month
Stationary
This is probably one of the things people forget the most when working remotely. 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.
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
Flights
This one probably leans more towards those who are remote working in another country.
It’s very rare that people will end staying in the country for years without going back home, as such it’s important to plan out these trips.
Most people from the US and UK travel to Europe or south east Asia with countries like Thailand, Ukraine and Malaysia all being hotspots.
What’s the cost: between $200 – $1000
Courses
With the advent of the internet it’s my firm belief that more people have become millionaires than any other time in history. I like to refer to it as the great equalizer.
Now most people who have “made it ” and have the ability to work from home/work remotely have had to take a course at some point. In fact I’d even wager a bet that a large percentage of remote workers are in fact business owners
Either to learn the skill they wanted to succeed, or to stay on top of the marketplace.
Whilst it’s true there are a lot of courses out there that don’t offer anything new at some point courses will need to be considered.
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
So no matter what your deal is, you’re going to need fuel to drive. 83% of Americans currently do it frequently.
You might be thinking, hang on a second Fehed, I work remotely so I no longer have a commute, And it’s true whilst you won’t be spending as much on fuel, you will still be paying for it.
For example let’s say you have to pop to the shops during the middle of the day? Or you have to pick up your kid from school. These expenses still add up and you need to make sure your income can cover this.
What’s the cost: between $50 per month
Mortgage payments
I am not a financial advisor. That being said there are a lot of rules when it comes to mortgaging and tax when it comes to remote working. Crunch has a number of great articles on it ( start here).
The gist of it is, just make sure you speak to your financial advisor before you make any decisions about remote working if you still have a mortgage to pay.
What’s the cost: 20% increase/decrease on your monthly mortgage payments
Salary
This again, is another one for the business owners reading this. If you have employees you will have to pay them. Most remote workers use freelancers on websites like Fiverr or upwork which is fine however at a certain point you’re going to need to get your own staff, which means paying them slightly more then a freelancer on occasion.
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
So Tax is a bit of a funny one as it’s not only a consideration for people who are self employed but also for regular J-O-B people like you and me.
Tax when you’re self-employed will typically cost around 20% plus any sales tax you have to pay once you’re over a threshold.
The good news? If you’re working from a home office you can potentially claim back some expenses depending on a few factors.
What’s the cost: 20-60% of your income
Mobile phones
Not necessarily the devices… if you’re anything like me you literally wait for your screen to explode until you get a new phone.
More so the plan you have. I mean similarly to your internet provider, your payment plan might start out okay, but as you spend more time at home you’ll find that more calls will be used on your home device and more data being used.
One of the way to get around this is by seeing if your employer will provide you with a device or payment plan ( sorry self-employed people)
So what is the best plan? Reviews.org have a great list.
What’s the cost: $40 per month
Transport
So if you don’t have a car at some point you’re going to have to venture out into the big wide world and need a way of getting around.
The good news is that most remote working countries in south asia are relatively cheap to get around in a taxi. Heck it might even be easier for you to rent or buy a moped.
If you are working from home in a western country however costs will be significantly higher although you might be able to expense some of these costs when travelling for work purposes.
What’s the cost: Budget your trip have a great resource on this
Accommodation
Accommodation works on two fronts. Your either going to be:
- Looking for accommodation to remote work in ( hostels)
- Paying for accommodation to stay over on business trips.
Although cheaper than commuting to work in some countries, these prices do start to add up and unfortunately is just something you will need to pay.
Ensure you keep track however as once again, so long as you are doing this for work/business purposes, you should be able to claim back
What’s the cost: Once again Budget your trip have a great resource on this
What about the non-monetary costs
Just when you forgot about non-monetary costs they come right back at you. It’s super important we look at these. In my experience non-monetary costs can actually be worse than monetary costs in the long term.
I mean if you spend $5 more on a room to stay in that’s a one off cost. If you spend five years going down the wrong path that could potentially cost you thousands.
Let’s break these down.
Time
Easily the most important cost when working remotely. You only have one life to get everything done. As such any time spent procrastinating or not getting stuff done that you need to is time wasted that you won’t get back again.
I mean from a business perspective there is nothing worse than spending 5 years on a project only for it never to take off the way you want.
Remote working can be cruel especially when it comes to business so ensure you set up a schedule and plan to use your time wisely.
Career
So this might prove to be a little bit controversial but bare with me.
Unfortunately it’s a matter of fact that bosses don’t see you as being as productive when working from home compared to the office ( even if the truth is different).
This could put your career back, I mean let’s face it. If someone shows up to the office everyday and is face to face with your boss, they are way more likely to have a better relationship with them and be much more in line for promotions.
The same can be said for people who own their own business. Like I said earlier if you spend 5 years of your life in business only for it not to work out, you could soon find yourself playing catch up.
Social Stigma
“you work from home, I bet you just sit around watching movies all day”
How many times have you heard that before? Or how many times have remote workers in other countries find themselves having to justify their life because they are on a nice beach.
It’s a sad reality that a lot of people want what they can’t have ( the grass is always greener) and so you might find a lot of people, even those close to you questioning your decision to not be a part of the crowd.
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 remotely.
Let’s say you are in another country – Are you familiar with their healthcare? Do you have to pay more for being an expat? What about the dentists – all things you need to consider.
On top of that if you are working from home or remotely by yourself, there is a metal toll that can sometimes happen, especially if you are an introvert. Make sure you’re looking after yourself and not running yourself into the ground.
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 notes 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’ve given everything you have and you’re just sick of the remote working mindset.
One of the reasons why I now go into the office a few days per week is just to get my mind right, the walls can definitely close in on you when working from a home office and the same goes if you’re working in a different country.
What once might have seemed like a paradise location can often turn into just another day in the office so keep note of yourself and be sure you take breaks when you need to.
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, making the decision to be a remote worker isn’t something you should take lightly. There are a lot of factors to consider. I mean if you total all the monetary costs we calculated you cloudspeed thousands every year just to get by,
That being said my recommendation is still to go for it, although there are many associated costs of remote working, they will usually be a lot less than a traditional office job.
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.
