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Working from the tropics: Costa Rica promises digital nomads a life of ‘Pura Vida’

March 27, 2021

A year into the brave new world of pandemic-related issues, it appears that some important changes to the way we live are here to stay.

One positive trend that’s expected to continue is working from home, as companies learned that this can actually increase productivity while lowering costs associated with maintaining large brick-and-mortar office spaces.

In fact, says Emergent Research, a California-based consultancy focused on small businesses, “multiple studies indicate that most firms are planning on greatly expanding their use of remote work even after the pandemic is over.”

This is also good news for the estimated 10.9 million U.S. citizens who didn’t have to fight rush hour traffic last year on their daily commute or spend as much on transportation and work clothes.

In trying to gauge how these workers felt about working from home, the international firm MBO Partners surveyed 3,687 independent writers, designers, editors and content creators, along with professionals working in IT, marketing and communication, among other professions. They found 83% of them reported feeling “happier working on my own,” with 71% saying that “working on my own is better for my health.”

We can only assume that none of those surveyed had little ones climbing over their laptops or spilling juice boxes all over mom’s and dad’s paperwork.

But the idea that all of these remote workers have to carve out a space at home to get their work done is changing.

According to MBO, the ever-evolving advances in digital tools and communication technology has made it possible for 4.8 million workers to travel while they work. Some are trading in their office chair for a lounge chair at the beach, and their home offices for co-working spaces in far flung tropical destinations.

“As long as I have good internet connection, I can work from anywhere,” says Marie Elena Hawkins, a writer and holistic health consultant who moved to Costa Rica from Tennessee a few years ago.

This subset of independent workers are often called “Digital Nomads,” since they rely on digital technology to keep up a lifestyle that allows them to see the world while they earn a living. They manage this by working from places with a similar or lower cost of living while garnering wages tied to higher-cost locations.

“It takes time to figure out how to make it all work, but the benefits greatly outweigh the drawbacks,” said Paul Butcher, a digital nomad from the UK who is currently living in Costa Rica. “Before choosing my next location, I would consider the cost of getting there and getting around, renting a place, and how much good internet and mobile service is going to cost me.”

MBO says nomads are twice as likely to be male than female and are most often millennials, although Gen Xers represent about quarter of the group. About half of nomads have a college degree, and the vast majority are “satisfied” with their lives. Some 83% are optimistic about the future, and 81% plan to continue their independent lifestyle.

“I’m the envy of my friends,” said U.S. expat David Fulton who runs a tourism outfit on Costa Rica’s Pacific coast. “They think I’m on a permanent vacation, but that’s not it at all. I go to work every day, just like they do. But when my day is over, I’m already at the beach or enjoying a spectacular view. It’s a totally different experience.”

The MBO report on the rising trend of Digital Nomadism says that approximately 17 million independent workers aspire to a digital nomad lifestyle, although the vast majority never take the plunge. However, concerns over future possible lockdowns or potential hospital stays makes traveling to wide open spaces on travelers insurance all the more attractive, especially for the uninsured.

Over the past decade, MBO notes a significant increase in demand for outsourced professional services as “organizations substantially increase their use of non-employee labor.”

A few countries in Europe are trying to cash in on this trend and attract international nomads to help boost economies that were hard hit during the pandemic. Most notably, the Portugese archipelago of Madeira is building a “digital nomad village” with the cooperation of co-working spaces, real estate, hotels and rental car companies, all working together to attract this demographic. Portugal is also creating a special visa category that will make booking extended visits to this warm ocean side spot a no-brainer.

And according to The Independent, “the Caribbean islands of Barbados and Antigua have unveiled similar schemes” to help boost their economies.

What about Costa Rica?

Last year, as lockdowns began throughout the world,  the Costa Rican government made it posisble for visitors to extend the validity of tourist visas. Currently, anyone who entered the country in 2020 can stay without penalty until June 2021.

As that deadline approaches, a group of Costa Rican legislators are working to pass a new one-year temporary residency status, geared toward digital nomads.

While details may change before the project becomes law, the requirements would include proof of an average monthly income of $3,000 made from sources outside of Costa Rica, and health insurance, to cover any medical needs while in country. Acording to the bill, this new visa will be processed online and would allow nomads to bring a spouse and children, as well as apply for a six-month extension during their stay. Nomads under this immigration status will also enjoy tax-free status, meaning that they can also bring in equipment necessary for their work duty free.

The details of this new sub-category of temporary residency status are being discussed by Costa Rican legislators as this is written. But information will be posted at The Tico Times (or  the website for the U.S. Embassy in Costa Rica as it becomes available.

For now, nomads who are just arriving can stay a maximum of 90 days on a tourist visa, and apply for temporary residency status in country. Many tourists opt to gain perpetual 90-day extensions by leaving the country and returning under a new tourist stamp.

For those who make a “visa run,” as they are commonly called, immigration officials will be on alert upon your return. They are mainly concerned about verifying that tourists are not working for Costa Rican businesses — and thus taking jobs away from local workers. They are also checking that tourists have enough money to support themselves while in Costa Rica and that a departure flight back to their counry of origin has already been purchased.

Is Costa Rica a good option for digital nomads?

We looked at the Nomad Index, a list of countries ranked according to the best conditions for digital nomads. The data was compiled by CircleLoop — a UK-based company offering cloud services to small businesses. The index compared the average speed for fixed broadband and mobile internet, the average price of internet service, and visa access. It also considered acceptance of migrants, average rental cost for a one-bedroom apartment and the score of each country on the World Happiness Index, among other criteria.

Costa Rica ranked 41st worldwide and fourth in Latin America behind Chile, Argentina and Brazil. What do those countries have that Costa Rica doesn’t? Chile (28) has much better Internet speed and the cost of that service is less expensive. Argentina (40) has a much lower cost of living. And Brazil (35) ranks just a bit better in most categories.

Where does Costa Rica shine? Its “happiness index” ranks the small Central American country at the top of the competition.

As far as tropical countries go, Costa Rica ranks third, behind Singapore (15) which is much more expensive than Costa Rica and Thailand (18), which has a similar cost of living, but is less open to migrants.

Becoming a digital nomad in Costa Rica

To help guide digital nomads considering long- or short-term relocation to Costa Rica, a new consultancy called Costa Rica Dream Team is offering online courses designed to take all the mystery out of living and working there.

In addition to covering details about real estate, cost of living and doing business in Costa Rica, courses explore residency, health care, entertainment, recreation, and even cultural dos and don’ts. Their digital format, supplemented with online question-and-answer webinars and insider blogs were developed for people on the go.

“We help our clients make a seamless transition to Costa Rica and enjoy a cross-cultural experience that is good for everyboody involved” said Julio Fernandez, who helped found Costa Rica Dream Team in 2020. “Too many people arrive with unrealistic expectations, get frustrated and leave. Our motto is ‘Know before you go.’ ”

At the end of the day, most nomads agree that making a nomadic lifestyle work depends on making informed decisions, being open to new experiences, and having a strong internet connection.

For those willing to make the leap, it can be an amazing adventure.

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