What is Financial Independence and Why is it Easier to Reach as a Travel Therapist?

It’s been over a year now since I reached financial independence at the age of 30, and getting to that point at such a young age is due in large part to choosing to pursue a career in travel physical therapy as a new grad.

Originally when Whitney and I started traveling, I laid out a rough outline and projected it would take me about 5 years of working as a travel PT to reach financial independence. But, surprisingly, I was able to both make more and spend less than I anticipated, which sped things up significantly.

Even though my story and path to FIRE (financially independent retired early) is unique, it didn’t require anything particularly special to be done. I think my journey to financial independence can definitely be replicated by other travel therapists.

The keys to reaching financial independence as a travel therapist were:

    • living frugally
    • hustling to make as much money as possible
    • investing money intelligently

What is Financial Independence Retire Early (FIRE)?

Essentially reaching financial independence is getting to the point at which it’s possible to cover all of your living expenses with only investment returns (or other forms of passive income) indefinitely. At that point, work becomes optional since the income from work is no longer needed to sustain your financial life.

Once financial independence is reached and work becomes optional, many people choose to retire early. I personally have only worked 10 weeks as a physical therapist in the past two years, since I’d rather spend time traveling internationally and working on other interests than to work with patients at this point in my life. It’s not that I never plan on working as a therapist again, it’s just that I no longer have to; and I am choosing to do other things with life right now. I enjoy helping people in a physical therapy capacity, and will likely do some sort of part time work as a PT in the future, but any money earned from it is just icing on the cake at this point.

How do You Determine When You’re Financially Independent?

Most people have no idea how much money they need to reach financial independence and retire. This is a problem because many people, myself included, are motivated by setting and achieving goals. How do you set and strive to reach a goal of retiring when you have no idea how much money is needed?

This is where the 4% rule comes in. The 4% rule is a research-backed method for determining how much money is needed to reach financial independence. Basically, when your invested assets reach a level where you can cover a year’s worth of expenses while withdrawing only 4% of your investment portfolio, you’ve reached financial independence. Even though average equity returns (taking into account the history of the stock market) are in the 8-10% range, there are periods of time when returns can be significantly lower than that, so planning to withdraw 8-10% from your portfolio per year can easily lead to running out of money before you die. At a safer withdrawal rate of 4% per year though, running out of money is very unlikely, assuming that your money is invested wisely.

An easy way to determine how much you’ll need to retire is to use the inverse of the 4% rule, by taking your yearly expenses and multiplying by 25. This is exactly how I figured out what net worth number to shoot for to reach financial independence back in 2015 when I started working toward FIRE.

Traditional financial planning usually involves calculating your retirement number based on your yearly income rather than your yearly expenses. But this just doesn’t really make sense. The true number you need to focus on to figure out your retirement, or financial independence, number, is how much you actually spend each year, and therefore how much money you need to live on for a year. In order to figure this out, you’d need to track your expenses for a few months or a whole year to get a good estimate of how much you actually spend in a year.

Since your financial independence goal number is determined by expenses, reducing monthly/yearly expenses is the easiest way to reduce the amount of time to get there. This makes your savings rate vital!

Why Strive to Achieve Financial Independence?

Everyone has their own reasons for trying to reach financial independence. It could be to spend more time with family, to take long trips overseas, to spend more time working on hobbies, as well as a variety of other reasons. For me the biggest reason was to have as many options as possible. Reaching financial independence meant that I can now pursue whatever it is that piques my interest at any given time. I’ve found over time that my interests change often, and having as much time as I want to pursue new interests when they arise is huge for me.

Why is Reaching Financial Independence Easier as a Travel Therapist?

There are several reasons why I believe that reaching financial independence is easier as a travel therapist compared to therapists working permanent jobs. All of the factors below directly contributed to my success in reaching financial independence so quickly:

  1. Higher income:This is the most obvious reason and the reason why many therapists choose to travel in the first place. Most travel therapists can expect to earn between 1.5-2 times as much money after taxes compared to a therapist working a permanent job. The more money a therapist is able to make, the more they’re able to save to reach financial independence more quickly.
  2. Becoming a minimalist:As a travel therapist, getting used to living with less is important. Packing and moving is always difficult, but it gets more difficult the more stuff you take with you to each assignment. Whitney and I both progressively became more minimalist the more travel assignments we took in order to avoid having to pack and move as much stuff, and this seems to be an almost unanimous trait among other travelers as well. Learning to be a minimalist is important in reaching financial independence because the less you buy, the lower your expenses, and the faster your path to FIRE.
  3. Lower student loan payments:I’ve written numerous articles on student loans including all the various student loan forgiveness options over the years. As a travel therapist on an income driven repayment plan, it’s possible to reduce your student loan payment significantly and even to pay $0/month in some cases. Going on the REPAYE repayment plan and pursuing student loan forgiveness while saving and investing as much as possible has allowed me to have a significantly higher net worth even when factoring in my student loan balance gradually growing. This isn’t the solution for everyone but is definitely worth considering, especially as a travel therapist with lower taxable income.
    • For those therapists who would rather pay off their student loans as quickly as possible, point #1 about higher income can help you to aggressively pay off your student loans within just a couple years as a travel therapist, compared with stretching it out over 10+ years on a standard repayment.
  4. Cheaper health insurance:Currently under the Affordable Care Act, subsidies can make health insurance extremely affordable for those with a low taxable income. I’ve been able to take advantage of this for the past couple of years with, health insurance costing me less than $150/month while using the ACA marketplace plans between contracts. While on contract I’ve always chosen to use company sponsored plans which have always been very affordable. For most Americans, health insurance costs are a major concern, but as a travel therapist with a lower adjusted gross income (AGI), health insurance can be very affordable!

Using Travel Therapy to Gain Freedom

Financial independence is a goal that everyone should be striving for regardless if retiring early is appealing or not. Even if you love your job and plan to never quit working, having the peace of mind of knowing that work is optional is invaluable. Having more options in your life is always a wonderful thing!

Pursuing a career as a travel therapist, with all of the flexibility and benefits inherent in the job, is a perfect way to reach financial independence more quickly. Travel therapy was certainly vital for me in reaching my financial goals in such a short period of time!


If you’d like help getting started on your own path to financial independence and travel therapy journey, feel free to contact us with questions or ask us for recommendations for travel therapy companies/recruiters to help you get started!

Jared Casazza

Written by Jared Casazza, PT, DPT

Tax Homes 101 (for Travel Therapists)

What is a Tax Home and Why is it Important for Travel Therapists?

In general, a Tax Home is usually your place of primary residence, but it has more to do with the place where you primarily “maintain business” and earn income, by the IRS definition.

  • The IRS defines a Tax Home as: “the entire city or general area where your main place of business or work is located, regardless of where you maintain your family home. If you regularly work in more than one place, your tax home is the general area where your main place of business or work is located.” (source: IRS)

The reason determining your tax home as a traveling therapist is important is because it has to do with the way that your income is taxed by the IRS while working travel assignments.

It’s a very important concept to understand, and most travel therapists will want to make sure they are meeting the requirements for maintaining a proper tax home per the IRS guidelines, so they can receive tax-free stipends for housing, meals and incidentals when away at travel therapy contracts. Receiving these tax-free stipends is part of what makes Travel Therapy Pay so lucrative, because your after-tax pay is significantly higher than it would be at a normal job.

So let’s dig in a little more to better understand what a Tax Home is and how you can make sure you meet the requirements in order to receive tax free stipends!

How Pay is Taxed as a Travel Therapist

Normally, if you work at a regular, permanent job as a W-2 staff employee, or as a PRN employee, all of your pay is taxed. You will receive a flat hourly rate or salary, and taxes will come out of each paycheck on all of it.

As a travel therapist, if you qualify, you will receive an hourly pay which is taxed, and in addition you will receive a stipend or “per diem” for housing, meals, and incidentals to help cover your expenses while you travel away from home to go work in the travel location, and this stipend is not taxed.

The reason why you could receive these stipends/per diems untaxed is because, you should be maintaining a permanent residence which will be considered your Tax Home, where you regularly return to, continue to have financial obligations, and continue to carry on business. Because you have financial obligations (including rent/mortgage, utilities, maintenance, and other bills) at your primary residence, the IRS may give you a “tax break” on some of the expenses you have at your second work location, the place where you are temporarily traveling away from your tax home to go and work, aka your travel therapy job assignment!

If you’re not meeting these requirements, and you do not maintain a proper Tax Home, but instead you’re just a “gypsy” (aka an “itinerant worker”) who travels around from place to place for work, then there is no reason for the IRS to give you a tax break on your income and stipends. In this case, you would be taxed on all of your pay at the travel contract, just like it was a normal, permanent job.

Tax Home Requirements

There are some guidelines to follow to be sure you’re meeting the requirements for maintaining your Tax Home, so that you can qualify for the tax free stipends (and keep more of your paycheck instead of getting it taken away in taxes)!

You must meet at least 2 out of 3 of the following requirements to be maintaining a proper Tax Home (Source: TravelTax)

  1. Have regular business (employment) in that area.
  2. Have a permanent residence (physical residence) at your tax home (metro area where you last worked) and are financially responsible for that residence’s upkeep (rent/mortgage/taxes/repairs) while you are away from home.
  3. You have not abandoned your tax home (plan on returning and spend around 30 days a year there).

We encourage you to visit TravelTax.com and IRS.gov to learn more about these requirements. If you have specific questions about your own taxes and Tax Home situation, we highly recommend contacting a tax professional such as those at Travel Tax!

Do Your Research!

We can’t stress enough that it is your responsibility as a travel therapist to do your research about Tax Homes and make sure you’re meeting the requirements! Do NOT rely on recruiters to tell you whether you are or are not meeting the requirements. And do NOT accept a travel contract where they are giving you tax-free stipends unless you have made sure that you qualify!

If you accept tax-free stipends as a traveler and you were ever audited by the IRS, it is 100% YOUR responsibility to prove that you were maintaining a Tax Home and that you qualified for the tax-free income. If you cannot provide this proof, you will owe back taxes on all of the stipends and may also incur penalties and fees.

  • To learn more on this topic, read this article that goes into greater detail about Tax Homes.

Bottom Line about Tax Homes

As a Travel Therapist, as long as you are maintaining a Tax Home where you have expenses, conduct business, and return to often/between contracts, you may qualify to receive tax-free stipends on your travel contracts. Receiving the stipends tax free is a huge perk and allows you to make much higher after-tax income compared to those working permanent jobs! But it’s vital that you do your research to make sure you’re following the rules in order to avoid owing back taxes and fees if you get audited by the IRS in the future!


We hope this was helpful in understanding a little more about Tax Homes and why it’s an important concept for travel therapists! Be sure to reach out to a tax professional if you need further guidance on this topic, as we are NOT tax professionals and this is only general information that we have found from professional resources (linked above).

If you have not already, be sure to check out the other articles and videos for our Travel Therapy 101 Series in order to learn all the basics about getting started with travel therapy!

Please contact us if you have questions for us, or fill out this form if you would like recommendations for travel therapy recruiters and staffing companies to get started on your own travel therapy journey!


Written by Traveling Physical Therapist Whitney Eakin, PT, DPT, ATC

Whitney Eakin headshot