Are Digital Nomads the Ultimate Risk-Takers?

11/15/2016 11:14 am ET Updated Nov 15, 2017

In the first week of my around-the-world trip a few years ago, I was en route to start a 4-day hike on the Inca Trail in Peru. I had just left my chemistry career behind, had a freshly sprained ankle courtesy of a dodgy sidewalk, and was suffering from severe food poisoning. Yet, I was super excited to get started and spend the first night in a local village sharing a room with some strangers and their pet guinea pigs. A fellow hiker, around 60 years old, asked me about my trip and I remember telling him I was a real chicken, afraid of everything.

He looked at me slightly confused and pointed out that I had just left behind a career in science and would be travelling to new places for an unknown amount of time, yet I still saw myself as a chicken. I was quite taken aback and started wondering whether he was right, maybe I wasn't so scared after all. Was I a risk-taker?

Fast-forward three years and I'm still traveling, now as a digital nomad, a location independent freelancer, and the topic of risk-taking remains relevant. Why are so few people pursuing this lifestyle, despite the growing number of people unhappy in their jobs? Technology and the rise of the gig economy has allowed many of us to leave the cubicle behind, yet most of us still don't. That begs the question: are digital nomads the ultimate risk takers?

What are the risks?

Some of the biggest 'risks' associated with the digital nomad lifestyle are leaving a traditional and stable career behind, traveling to 'dangerous' countries, getting sick on the road and being lonely or homesick. Being a DN also means risking being misunderstood by your colleagues, friends and family who might well think you're on a perpetual holiday.

Make no mistake, every single digital nomad I have met shared at least some of these fears. We are all scared sometimes, but only some of us will risk bankruptcy, food poisoning and being frowned upon by society.


Many factors influence the way people take risks

The most obvious place to start is with demographics. While there are no comprehensive statistics on the gender and age distribution of digital nomads yet, the majority of digital nomads I have met are millennials, in their twenties to thirties. The fact is that people seek more risks when they are young.

A large proportion of digital nomads I've met along the way are men, who are traditionally more willing to take risks, and couples, who benefit from facing the risks with a partner by their side.

Less economic stability

The economic landscape has changed drastically compared with our parents' generation, and the kind of job security they had doesn't exist anymore. The chances of keeping the same job throughout your working life are now slim to none. Job hopping is increasingly common amongst millennials; so, quitting a job that you hate to work for yourself may actually be perceived as much less of a risk.

Meanwhile, the boom of the gig economy and the growing number of remote jobs mean that the number of possibilities available to us are increasing all the time. So, while digital nomads take more risks, they also have ever increasing employment options.

We all perceive risks differently

Risks are subjective and Columbia University psychologist, Elke Weber, accounts for this subjectivity with a model called "domain-specific risk propensity." According to Weber, everyone has a unique risk propensity in five different categories: financial, health and safety, recreational, ethical, and social. So, while a person might be happy to take a financial risk, they might be more conservative when it comes to social risk-taking.

Every freelancer or entrepreneur has had to take risks and step outside of their comfort zone. Many digital nomads were self-employed or business owners for years before they started traveling. They simply realized that if they can work from a coffee shop in Austin, they could just as easily work from one in Bangkok, so their barrier to entry is much lower. And if you're used to taking risks, you can keep taking risks.

Psychologists have also found that a person's tendency to take a risk is related to how beneficial they expect the outcome to be. Having the opportunity to see the world is a huge benefit to many people and makes this lifestyle a risk worth taking. Other benefits include greater freedom, breaking free from boring jobs and meeting new people from different backgrounds and cultures.

Traveling is risky

Many digital nomads were long term travelers before they started to work while being location independent, myself included. From eating dishes you can't pronounce, to trusting strangers to drive you safely around town, travelers take little risks almost every day. As a result, they perceive the risks of this lifestyle as being much lower than those who are leaving full employment and a home base to jump straight into location independence.

The novelty factor

The location independent movement is still in its infancy and current digital nomads are early adopters of this lifestyle. By definition, early adopters are risk takers. They make up around 13% of the population and are more willing to put their trust into new technologies and trends than most. But they also put plenty of research before adopting a new trend, mitigating the risk by doing their homework.

Technology has changed the face of travel and WiFi is now available in the most remote corners of the planet. We have access to crucial information such as safety, political situations, flights and weather at our finger tips, so digital nomads can easily inform themselves, thereby lowering the risks.

Lack of infrastructure

A huge hurdle in this lifestyle is figuring out how simple logistics, such as tax, health insurance, visas, banking and other services, which were created for people with one home base, work for digital nomads. It can be exhausting to untangle this mess of issues, and could be off-putting to those attracted to the lifestyle. When easier solutions become available, more and more people are likely to adopt location independence, while the first generation is left to figure it out along the way.

So, are digital nomads the ultimate risk takers? In the end it comes down to your values and what you stand to gain from living a location independent lifestyle. The current generation of digital nomads are early adopters of a trend that will surely become more mainstream in the years to follow. Once millions of people have demonstrated that the risks involved are few, more people will follow.

Are you a digital nomad? Do you consider yourself to be a risk-taker? Please share in the comments.