Geo-Arbitrage & The Digital Nomad Lifestyle
What is Geo-Arbitrage?
Geo-Arbitrage (Geographic Arbitrage) is the financial strategy of earning income in a strong currency (like US Dollars via remote freelance work) while living in a country or city with a significantly lower cost of living (like Thailand, Mexico, or Portugal).
This allows you to drastically increase your savings rate without having to work harder or acquire more clients. The difference in living costs acts as a direct multiplier to your wealth.
Frequently Asked Questions
Do I still have to pay US taxes if I move abroad?
Yes. The United States taxes its citizens on their worldwide income, regardless of where they live. However, you may qualify for the Foreign Earned Income Exclusion (FEIE), which can exclude over $120,000 of your income from federal taxes if you stay out of the US for 330 days a year.
Is geo-arbitrage just for international travel?
Not necessarily. You can practice domestic geo-arbitrage by keeping a high-paying remote NY or SF job, but moving to a low-cost Midwestern state or a state with 0% state income tax like Texas or Florida.