Use this life hack even when making minimum wage.

Photo by Micheile Henderson on Unsplash

I know what you’re thinking. This must be clickbait. How on Earth could I save 90% of my paycheck?

Trust me, I thought it was too good to be true too. But then I tried it. And now I save my hard-earned money like never before.

I learned about this idea a few years ago after graduating college. I got a job working remotely and something didn’t sit well with me about forking over 75% of my earnings to automatic monthly expenses.

Automatic monthly expenses are those which you can’t avoid; rent, utilities, health insurance, car insurance, food, cell phone bill, etc.

If you’re lucky, you may be able to dodge a few of those bills if you’re willing to sacrifice certain luxuries like your cell phone bill or maybe your employer provides health insurance.

However, I’m going to give you a hack that reduces the cost of all of these things and can make your day-to-day financial situation all the less stressful.

But first, there are some things you should know. . .

Have you had trouble saving money over the years? You’re not alone. Did you know 69% of all adult Americans have less than $1,000 saved?

According to the same article linked above by SpendMeNot, the personal savings rate of all Americans in 2019 averaged out to 7.9%. This is less than the recommended 10–15% most financial advisers suggest.

Let me clarify this — any savings is good.

However, by saving only 7.9% of your income, you’re putting yourself at real risk of an unavoidable emergency. In fact, a quarter of all Americans wouldn’t even be able to afford to spend $100 in an emergency situation.

We live in a high-consumption society. Consumerism runs rampant in all corners of the world, especially the United States. American spending habits are among the worst in the world — spending nearly three times more on consumer goods than any other country.

Despite the convenience, you would spend less if marketing ploys and deceptive advertisements weren’t constantly being forced down your throat.

Everyone could agree that they wouldn’t spend as much money if Amazon weren’t so damn easy.

But it’s not just a problem in the U.S. — in the United Kingdom, Canada, Australia, China, Japan, Germany, France, Brazil, etc. Everyone likes to spend money that we can’t really afford.

But what if I told you there was a secret that led to a cheaper life and more savings?

*** Disclosure: Before telling you the secret to boosting your savings and what you must do to take advantage of this life hack, I must clarify something.

This strategy is not for everybody.

As a matter of fact, most people probably won’t even bat an eye at this concept. It’s not feasible for most. However, for those that have the liberty to commit to it, they will reap the benefits and probably increase their quality of life.

The secret to saving more

The magic behind a 90% savings rate is something known as location arbitrage.

Location arbitrage is positioning yourself in a location where your money goes further. Understand?

It’s like this:

In New York City, you may be earning a $75,000 income. However, after paying $3,000 per month on an apartment, your annual income is already halved.

Instead, you’d be much better suited to work for your company remotely and living in a place like Kansas City where you can find an apartment at less than a quarter of the price of the New York apartment.

. . .

I understand that moving from New York City is only viable if your company has a remote department. But chances are, there has never been a better time to ask your company about working from home.

Before coronavirus, it is believed only 7% of the American working population enjoyed the privilege of working from anywhere. Since COVID has rendered us unsafe to head to the office, however, 64% of Americans have adapted to working from home.

Seeing that remote work is possible and productive, the pandemic has changed the mindset of many workplace managers. Now, the question begs to be asked — is remote work here to stay?

That’s why I implore you to request a remote working agreement with your employer. You never know what could come of it.

How can I reach a 90% savings rate?

Moving somewhere domestically probably won’t land you a 90% savings rate. As a matter of fact, I can see how some people wouldn’t desire to move from New York City to middle America even if it meant cutting their expenses in half.

That’s fine. There is a solution to that.

It’s moving abroad.

By opening yourself up to the world, it’s certain there is a place that matches your interests while saving you money.

In my case, I’ve found a home in Bali that costs 1/5 my life in the United States would cost. Let’s go over the numbers. . .

Note: The kinds of savings I’m about to show you can be replicated in many parts of the world.

Annual expenses comparison

Let’s compare my own expenses in Kansas City, USA, and Bali, Indonesia. These are real expenses I’ve averaged over time living in both places extensively. Let’s start with the big expenses:


In Kansas City — $900/month for a two-bedroom apartment plus utilities in the suburbs of Kansas City

In Bali — $210/month for a two-bedroom apartment plus utilities in the expatriate beach town of Canggu

Location arbitrage savings: $710/ month


In Kansas City, I owned a 1998 Nissan Altima which I spent $40/month on gas and $100/month on insurance.

In Bali — I rent a motor scooter for $35/month and spend about $5/month on gas.

Let’s not even factor in the cost of maintenance of each (my scooter maintenance is $0).

Location arbitrage savings: $100/month

Health insurance:

I’m a self-employed individual so I don’t have an employer to cover health insurance.

In Kansas City, I ended up paying about $60/month after my premium tax credit because I’m a low-income earner.

In Bali, I am covered almost identically by a travel/health insurance company called SafetyWings for $40/month. Plus, it covers other travel-related mishaps like lost or stolen luggage, flight/hotel cancellations, etc.

Location arbitrage savings: $20/month

Cell phone:

In Kansas City — $85/month

In Bali — $5/month for a comparable plan

Location arbitrage savings: $80/month


Note: I’m not one to have a particular taste. Throughout my life, I’ve basically eaten whatever is cheapest. This includes mostly dining in.

However, in Bali, it’s so cheap to eat at a restaurant that it often makes more financial sense to dine out.

In Kansas City: $350/month

In Bali: $200/month

Location arbitrage savings: $150/month


While it’s often difficult to assess the cost of social life in different places at different times, I’ve tried my best to give you an idea.

In Kansas City a movie theater ticket costs around $15. A beer at a bar will cost about $6. On average, I spent $100/month which is frugal according to others’ standards.

In Bali, while I have about the same kind of social life, I spend on average $40/month.

Location arbitrage savings: $60/month

. . .

These average expenses give you an idea of how much savings you can achieve by moving abroad. Let’s see how it translates to a 90% savings rate for me. . .

I work remotely as a content writer for several companies. In 2020, my income was $58,500.

Totaling the above monthly expenses, my cost of living in Bali is just north of $500 per month. Dragging those expenses out to an annual total, I will have spent $6,000 in 2020.

That equates to an 89.75% savings rate on my total income for 2020.

Compare that to my savings rate in Kansas City which is 66.5%, it’s easy to make the argument that location arbitrage is the key to saving big.

Use location arbitrage to retire early

Your big savings rate is only the start of the advantages to location arbitrage. Check out how easy it is to retire super early when you make your life more affordable.

Not only that, but you might find your quality of life improves after moving. In Bali, mine certainly has.

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