The Real Cost of Working from Home

Although there are undeniable perks to working from home, there are some surprising downsides, too. Before you make the switch, know about the hidden costs of remote work.

A Gallup poll from October 2021 revealed that just under half of all full-time employees in the United States were working from home. 25% of former office workers had transitioned to fully remote work, and another 20% were working from home part of the time.

Of the workers polled, 91% wanted to continue working from home at least a few days a week. The workers cited greater flexibility, improved work-life balance, and the lack of a commute as the most important reasons they wanted to continue working from home.

And while the benefits of remote work are very tempting, it’s important not to overlook the downsides if you are considering making the switch.

You Need a Dedicated Workspace

Last year, when it became clear that offices would remain closed for a while, Forbes investigated the hidden costs of working from home. One thing they discovered was that 72% of remote workers did not have a dedicated workspace—and 40% of them didn’t even have a desk.

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Working from your dining table, your couch, or even your bed might seem like a luxury after years of the office grind. But there’s now plenty of evidence that shows what a bad idea it is to ignore ergonomics at work. You need to have a proper desk and chair, at the bare minimum, to work without hurting yourself. Poor posture at the computer can lead to carpal tunnel syndrome, headaches, back and neck pain, and eyestrain.

In addition to ergonomic problems, remote workers aren’t moving as much. Without the need to walk around the office, chat with coworkers, or refill coffee mugs, we’ve become much more sedentary. To protect your health, it’s essential that you get up and move for a couple of minutes every hour. In addition, experts also recommend that you follow the 20-20-20 rule: look away from your computer screen every 20 minutes and focus on something 20 feet away for 20 seconds.

You’ll Pay Higher Utility Bills

When you work from home, your utility bills go up. Office workers can adjust their thermostats to use less energy and switch off the lights before leaving for the day. Remote employees use significantly more energy.

Nina Lozano reported on the rising costs of working from home last year, highlighting the hidden costs and potential difficulty in getting reimbursed by your employer.

“On average, remote workers have seen a $40 – $50 monthly increase in their energy bills or as much as $600 dollars a year,” Lozano states. “While some are able to absorb the costs, others may not have the money to spare.”

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If your work-from-home expenses knocked your salary to below minimum wage, the federal government requires your employer to reimburse you for the difference. A handful of states are now requiring employers to reimburse workers for expenses regardless of salary: California, Washington D.C., Illinois, Iowa, Massachusetts, Minnesota, Montana, Hampshire, New York, North Dakota, Pennsylvania, and South Dakota.

In addition to paying more for electricity (and gas, if you use it) each month, you may also need to upgrade your internet connection. Experts advise that remote employees have a hard-wired connection—not Wi-Fi—and high-speed internet access.

You Won’t Get a Tax Break for Your Home Office

According to The Penny Hoarder, full-time remote employees can’t deduct office expenses from their taxes. If you were hoping to get a tax break after setting up your workspace and upgrading your internet, then you’ll be disappointed. Here’s the rundown on the official tax rule:

If you’re employed by a company and you work from home, you can’t deduct home office space from your taxes. This applies whether you’re a permanent remote worker. It also applies if your office was temporarily closed in 2021 because of the pandemic. The rule of thumb is that if you’re a W-2 employee, you’re not eligible for a work-from-home tax deduction.

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If you also run a side-hustle from your home office, you may be able to deduct some expenses. However, you’ll need to meet the IRS’s requirements for a home office. Technically, you could deduct a percentage of household expenses (including utilities) equal to the percentage of your home’s square footage used exclusively as an office.

However, you would only be able to deduct that amount from your side-hustle income, not your full-time salary. If you decide to try going this route, it’s a good idea to get an accountant who specializes in self-employment taxes to help you.

Read More: 1099 Forms: What Self-Employed, Private Contractors Should Know About Their Taxes

You Might Need a Bigger Space

What if you don’t have enough room to set up a dedicated office space in your home? Apartment dwellers are feeling the crunch as they spend all day inside. For smaller spaces or homes that are shared with other people, just finding a little privacy where you can concentrate on a project or participate in a video conference can be a nearly impossible challenge.

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“Anyone who has transitioned to remote work from a small apartment will tell you is that it’s not very pleasant,” Christopher Stanton, a professor at Harvard Business School, told Bloomberg CityLab. A study co-authored by Stanton revealed that remote employees spend more on housing across the board. The study recommended that companies close their offices and use the savings to pay their workers more—but that seems unlikely to happen any time soon.

“[S]o far, besides offering bonuses to offset home-office upgrades, employers do not appear to have shown much interest in raising salaries to reflect their lower office expenses,” Sarah Holder reported for Bloomberg CityLab.

Some workers have opted to rent a desk or subscribe to a monthly pass at a coworking space. While those spaces offer many of the perks of an office—including social interaction, free coffee, and even access to fitness equipment—they come with a hefty price tag. For workers who are already struggling to make ends meet, a coworking space is unattainable. And working in a coffee shop isn’t exactly a sustainable solution.

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The problem of space becomes compounded when multiple members of a household are working from home. Forbes suggested that these workers may “feel inescapably overwhelmed with the stress of having kids and partners at home all the time, and the lines between professional and personal time are often blurred.” Parents have had to juggle childcare with their professional duties, and some partners have struggled with spending far more time together than usual.

There’s no easy solution to these problems, and it’s likely that we still haven’t seen the full impact of so much of the workforce moving to remote work.

You Won’t Get Office Perks

It might not seem like a big deal, but when you work from home, you’ll have to provide your own coffee. If you’ve gotten in the habit of enjoying a couple of cups from the office coffee pot, that burden is now on you. No more office snacks, catered lunches, or other fun little freebies that companies used to provide to keep up morale.

You’ll also have to provide your own office supplies. If you’re starting from scratch at your home office, you’ll need to stock your desk with all the essentials on your own dime. In a study by business.org, 49% of remote workers said they were spending more on groceries now compared to when they worked in an office. Increased stress and a more sedentary lifestyle can lead to extra snacking at home—and when the kitchen is just a few steps away, it’s all too easy to snack more throughout the day.

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But there are more perks to working in an office than just snacks and supplies. As Jon Arnold told Tech Target, “Not everyone is cut out for remote work, and businesses will need to invest in resources and activities to counter the isolation. Building culture and camaraderie is just as important as providing leading-edge collaboration tools.” Working from home can negatively impact your performance and concentration. It can also make you feel isolated, which can take a toll on your mental health.

When all the negative aspects of working from home are looked at together, it becomes clear that burnout is a real possibility. Without the office camaraderie and face time with your supervisor, your career progression could also stall. For better or worse, decisions about promotions or assigning projects are often made based on the personal connections we make at work. Ankur Modi, an expert in both behavioral psychology and workplace analytics, warns that we have a long way to go before remote work becomes an equitable alternative to the office.

“In the end, Modi wrote, “the future of work is distributed, flexible and remote. But that future isn’t coming until we solve these problems that stop us from moving forward.”

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