Why “Shiny Object Syndrome” Prevents Offshore Success

Written by Andrew Henderson

Dateline: Kuala Lumpur, Malaysia

Let’s take a short stroll through history and the Wright Brothers story.

In 1903, aspiring aviation engineers around the world were in an intense competition to see who could build the first flight-capable aircraft. Most engineers approached the challenge by attempting to build the strongest engine possible to get their plane off the ground.

Larger and more powerful engines were built, resulting in the creation of some of the most sophisticated engines of that time . . . but not for flying. The engines were impressive, yet utterly useless.

Meanwhile, in North Carolina, the Wright Brothers were taking a very different approach. Rather than focus on the engine, the brothers focused their aeronautical work on designing a dependable method of pilot control, including the plane’s aerodynamics, propeller, and wings.

In fact, they barely even worried about the engine.

Instead, they concentrated on finding a plane that could glide without one. With their small, homebuilt wind tunnel they collected valuable data that allowed them to design and build more efficient wings and propellers than any that preceded them.

Then, once they had the right design, they attached an average engine to their craft and suddenly — on December 17, 1903 — the world’s first controlled, powered human flight was a reality.

The Wright Brothers avoided the shiny object syndrome

The story of the Wright Brothers contains an important lesson for anyone seeking the benefits of living, investing and doing business overseas.

While others got caught in the engine dilemma, the Wright Brothers were able to focus on what really mattered, leading them to their success. Today, history is repeating itself with the same basic engine dilemma.

Only, offshore.

The fact is, too many people ignore the critical factors for successful, lucrative offshore companies and investments because they are focused on their abundant choice of engines rather than what they are trying to achieve.

For instance, I see far too many individuals get excited about the latest investment strategy, high bank interest rates, cheap passport, easy business idea, or newest tax haven without really knowing toward what end they would use any one of those tools.

It’s the “shiny object syndrome” at its worse: Individuals always in pursuit of the latest flashy offer, constantly trying to build or buy or invest in a bigger “engine”.

Does this sound like something you suffer from?

Don’t get me wrong, engines are great. Without an engine, Wilbur and Orville Wright never would have achieved flight; but they wouldn’t have reached that achievement with just an engine, either.

The engine is not the end goal.

Engines can power your system to take you to your end goal, but if you don’t know what that goal is or have a system in place to achieve it, how do you expect to get off the ground, let alone go anywhere?

So, what is your end goal and what is the holistic plan — your “aerodynamic” system — that is going to get you there?

THE PROBLEM WITH SHINY OBJECT SYNDROME

The offshore world has largely been designed to sell you shiny objects. 

There’s a guy telling you that Panama is here for all of your ills and another saying that opening a company in Singapore is the best option. There are so many people out there trying to sell you on easy, shiny options in a very complicated world.

The result is that many people waste a lot of money and never solve their problems.

I worked with someone recently who came to me wanting to get a second passport and expatriate from the United States. For him, the second passport HAD to be in Europe because that’s where he wanted to live. 

Instead, we suggested he get something more like a Grenadian passport. People from all over the world live in Europe without having citizenship there. He didn’t need to get a European passport. He could pick up a passport that ranks higher on our Nomad Passport Index, expatriate, and then use that passport to get a residence permit in Europe.

All told, we helped cure his shiny object syndrome and saved him hundreds of thousands of dollars.

He liked the idea, but no one had ever talked to him about the concept of using a citizenship and a residence together, (i.e., getting citizenship in one country and residence in another). Going where you’re treated best oftentimes involves separating these two things.

We deal with plenty of people who hear about citizenship by investment and go chasing after it when they don’t actually need a second citizenship. No one in the world is going to lower their taxes by becoming a dual citizen.

Living outside of your home country and being taxed as a resident somewhere else is what lowers your taxes.

What you need is a tax residence. What you need is a plan that determines where your income is earned, how you’re paid, how your business is paid, and how your investments are run. 

You need a plan, not a second passport.

The same applies to creating offshore companies. I worked with someone running a small business alongside his full-time, highly lucrative job. He heard the potential benefits that could come from setting up an offshore company and wanted to jump right in.

This was the bauble for his shiny object syndrome.

We went over the specifics of his situation and figured out that he actually didn’t need an offshore company. He needed to work out a basic tax strategy where his income wasn’t taxed because he was offshore.

Not every situation requires setting up a new offshore company.

High-net-worth individuals are constantly prescribed trusts. People hand out that suggestion like it’s cotton candy. Not every situation requires creating a trust. In fact, if your goal is basic entrepreneurial asset protection, the proper company structure might do you just as much good.

People are buying all kinds of things that they probably don’t need because, deep down, we love the idea of being entertained. Instead of focusing on our problems and building out truly helpful solutions, we allow ourselves to be distracted by the new big thing. 

We get caught on the easy and fast path to citizenship in Paraguay rather than really looking into what Vanuatu, Armenia, or Kathmandu can do for our situation instead.

KNOW YOUR END GOAL

For the Wright Brothers, the end goal was flight. That’s about as clear as it gets. For those looking to go offshore, there are so many options that the answer isn’t always as clear and it definitely isn’t the same for each person.

Finding your end goal involves asking yourself questions like: “What am I trying to accomplish?”, “Why am I doing this?”, and “How does each thing fit into the bigger picture?”

Asking yourself, “Do I need a Panama company or a Belize company?” is just asking yourself what engine you’re going to strap to your plane. You need to know what you are trying to build before you can even begin to know which tools you can use to do the job.

Once you know your end goal, you need to establish a plan based on what you’re trying to achieve. As basic as that sounds, no one else is telling you this stuff. Everyone else is just selling you more tools, more nonsense, more of whatever else you need to get a bigger engine.

More information and no transformation.

I’ve been doing this for over a decade now and I’ve seen that when I focus on how to get more investments and other shiny objects, all I’m doing is building a bigger engine that doesn’t get me anywhere. When I focus on what am I trying to accomplish, things actually work.

Fitting Puzzle Pieces Together for a Holistic Offshore Plan

Shiny objects for the sake of shiny objects will leave you with a lot of pieces to different puzzles, but no complete picture.

For anything to work to its maximum potential, everything needs to fit in place like a puzzle piece. Giving into shiny object syndrome leaves you with random puzzle pieces sitting around that don’t fit with each other. Not only are you going to spend too much money, you’ll be spending that money on something completely unnecessary.

So, what are you trying to accomplish?

Be accountable to yourself and the goals you want to attain. Write them down and then know what you must do — down to the most minute details — to achieve them. Know the exact costs, necessary legal work, specific timeline, etc.

For instance, the average person who does this on their own takes roughly 12 months and usually spends $100,000.

However, I’ve seen people spend three years and $200K to get the same results.

Heck, I’ve spent nine years, and while I’ve planted dozens — maybe even a hundred — flags around the world, I could have gone much faster if I weren’t the one writing the playbook.

If you work with someone who knows what they’re doing, you cut that cost and the time. But going it alone may still be the best option for you. 

What is important is that you understand the timeline and are able to make an informed decision of whether you can design the wings and then build the engine yourself, or whether you can benefit by getting help. 

The answer will be different for each person.

Critical Success Factors Over Shiny Objects

One of the biggest attractions of the offshore world is that it provides so many options to improve your life. International diversification allows you opportunities to grow and protect your wealth, build a successful business, make it more stable, get more lucrative investments, and increase your personal freedom, to name a few.

But what is your reason for looking overseas?

People are much more interested in focusing on how they can collect X, Y, and Z than how they can solve their problems. 

If you focus on collecting shiny objects, you’re going to have a lot of people selling you on companies you don’t need, which then come with annual maintenance fees and ongoing tax filing obligations that you don’t want to deal with.

Everyone is trying to find the quick fix when what they really need is a prescription that addresses everything they’re trying to accomplish.

If you have a specific end goal that is served by going offshore, write it down, commit to it, and then design a plan that will get you there. Don’t just chase after shiny objects and powerful engines simply because they’re shiny and powerful.

Andrew Henderson
Last updated: Mar 26, 2020 at 9:27PM

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