Dateline: Bogota, Colombia
High-net-worth individuals have increasingly asked me about the best places to get a second residence or passport without throwing their money down the drain.
They don’t like the idea of donating money and they don’t want the hassle of buying overpriced real estate or even managing a decently priced property in order to get their residence towards citizenship by investment.
The good news is that there are options.
In this article, I will share eight countries where investing in bonds will help you either get an instant second passport or a second residence that will help lead to a second citizenship.
We’ll start by looking at two countries that allow you to get instant citizenship just by investing in bonds.
St. Lucia’s Citizenship by Investment
First, located in the Caribbean, is the beautiful island of St. Lucia. I’ve personally been through this program.
In the past, the St. Lucia bond program has generally cost $500K in bonds, plus a processing fee of $50K, rather than a donation of $100K. So, for a lot of people, the opportunity cost just never made sense.
In the latter part of 2020, they offered a COVID relief bond and cut the investment requirement down to $250K and the processing fee down to $30K for a limited time.
But even now that the discount is gone, you can still invest your money for five years and get St. Lucian citizenship. Then, you can eventually get that half a million dollars back without interest.
If you’re looking for second citizenship in the Caribbean, St. Lucia’s bond investment is not a bad option. However, it would have been a much better deal if you had got in on the COVID discount.
If you don’t want to tie up half a million dollars for the next five years, the $100,000 donation is the most affordable price out there for citizenship by investment.
You can learn more about St. Lucia’s citizenship by investment program here.
Turkey’s Citizenship by Investment
Turkey is definitely a different kind of passport, but one that can be obtained in a matter of months.
Now, most people choose the $250K real estate option. There are some decent real estate investment opportunities in Turkey – especially if you work with a team like Nomad Capitalist (hint, hint) – where you’re not buying the “gringo” real estate but the fairly priced real estate everyone else in the market can access.
This method can bring some decent deals.
But for some people, getting into foreign real estate is quite a hassle, making Turkey’s bond investment option much more attractive.
You can double your investment up to $500K and make a qualifying capital investment to qualify for citizenship. And one of those capital investments at that level is buying bonds.
This is one option where you can put your money in Turkey, get citizenship in three to four months, and have visa-free travel to more than 110 countries. For more information on Turkey, look at our Ultimate Guide to Turkish Citizenship.
Now, let’s talk about a few countries where you can get a residence permit through bond investment.
The United Kingdom Bond Investments
The United Kingdom – for many people, one of the most sought after countries in the world – has what’s called a Tier 1 visa program that allows you to become a resident and work towards their version of permanent residence. This can all happen in a matter of five, three, or even two years, depending on how much you invest.
There is a caveat, but it’s probably not much of an issue for you if you’re reading this.
In order to become a long-term resident of the UK, you need to speak English. If you do not know English and you have only given yourself a two-year timeline to citizenship by investing more money in bonds, then you won’t be giving yourself much time to learn English. But if you’re reading this, it’s probably not a concern.
The range of investment amounts starts at £2 million and goes all the way up to £10 million, depending on how long you would like to wait to lock in your more permanent status.
Now, unlike some of the Golden Visa programs in Europe, this is not a program where you can simply never live in the UK and work towards citizenship.
You do need to live there.
So, you’ll definitely want to look at some of the tax planning strategies in the UK if you’re actually going to go live there. Otherwise, you would be keeping it as a residence that may never lead to that permanent status or citizenship.
But certainly, if you have £2 million to put into British bonds, it’s a good option to consider.
New Zealand Bond Investments
New Zealand is another increasingly popular option among high-net-worth individuals. It has numerous programs for investors to put money into the New Zealand markets which could include debt options.
There is a retirement option, which is a little bit less permanent. That one starts at NZ$750K.
And then there are the investor 1 and investor 2 options that start at NZ$3 million and go up to NZ$10 million, depending on how much time you want to spend in the country.
If you invest less, you need to spend more time in the country to lock in your status and work towards citizenship. If you invest more, you only need to be there for about six weeks a year.
So, if you have NZ$10 million to invest and you like the idea of having access to a country that – while not particularly income tax-friendly – is friendly, safe, fairly isolated, and has other tax benefits, New Zealand could be right for you.
New Zealand makes the process very easy with minimum time spent in the country. Though in my opinion, there are better and less expensive options as well.
Portugal Bond Investments
Back to Europe. Many people are familiar with Portugal and its Golden Visa program where you can buy real estate from €500K all the way down to lesser amounts depending on the quality of the real estate that you’re looking to buy and get residence in return.
This is a great program that we have helped many of our clients successfully use.
But if you don’t want to invest in Portuguese real estate, there are other qualifying investments, including a bond option. Many people don’t talk about this because the number is substantially higher. It’s a €1 million investment, which can be in Portuguese debt.
If you don’t want to buy real estate in Portugal and you don’t want to invest in a managed fund, then there is an option to simply make a capital investment into Portugal at the €1 million level.
Spain Bond Investments
Next door to Portugal, Spain also has a Golden Visa program with a €2 million government bond investment option.
Now, for some of the programs that I’ve mentioned, you can invest in any kind of different debt, whether it’s government or otherwise. Generally, in Spain, your investment needs to be government debt only.
If you do want to put the €2 million into Spanish government debt, you can get relatively favorable conditions for getting a residence permit. This can help you work your way towards permanent residence, and eventually towards citizenship.
However, you’ll have to wait a relatively long timeline to get citizenship in Spain.
You should also consider that Spain is one of the few countries left in Europe that still has a wealth tax… and they have started stealing private property, so…
I can’t say it’s my favorite option. But if you like Spain — and I have had clients where someone in the family will only live in Spain—they certainly do have some nominal tax savings opportunities for new immigrants and you can get those by buying Spanish bonds.
Andorra Bond Investments
Located in the Pyrénées between Spain and France is Andorra. This country offers a €400K — basically a category A — residence program. Now, Andorra is not talked about that much. There are a couple of different criteria you need to satisfy to become a resident of Andorra.
One of them is that you do actually need to be in the country for 90 days a year.
The other one is you need to set up a bond for yourself, in case you are out of the residence program, and to make sure you can support yourself.
I think most people look at it as a real estate investment, but there are opportunities to invest in debt in Andorra also. Once you put €400K into the government of Andorra, it’s a very, very long road to citizenship — even longer than Spain.
You’re looking at decades.
But that’s better than a residence permit that will never lead to citizenship. And if you’re looking for a peaceful, rather isolated, very tax-friendly country with great options for starting a business, if you like the four seasons, skiing, and a place where you don’t have to spend that much time to keep the residence active, then Andorra might be a good option for you.
It’s a cheaper bond option than in Portugal. Portugal may be easier to handle if you’re looking to make other investments, but if you just want to make a capital investment, then Andorra might not be a bad opportunity for you.
Latvia Bond Investments
The last Golden Visa opportunity in Europe that is worth taking a look at is in Latvia. This program — kind of like the UK program — used to be pretty popular. It’s kind of fallen out of favor as they don’t actually issue too many residence permits to investors any more.
The most common investment recently has been forming a company and paying a certain amount of tax every year. So, if you have a business, that may be one way to go.
There’s also a real estate option, but it’s a little bit more restrictive than some of the other Golden Visas in Europe.
You can also make a debt obligation with the bank. If you invest €250K in government debt at 0% interest, you can get a Latvian residence permit. It starts as a temporary permit. If you actually live in the country, it can become permanent. Otherwise, you just keep it as a temporary permit for as long as you hold the investment.
Again, not as good for second citizenship, but if you like more of the four seasons, with more of that Eastern European vibe, it’s a nice option. Riga has really developed over the past decade and is a charming city. They have really beautiful winters and it’s a great place to spend time if you want that more calm, quiet atmosphere.
Portugal is becoming more popular—it’s certainly warmer there—but I think Riga offers some interesting opportunities. If this fits your description of your Nomad Capitalist lifestyle, then it’s definitely worth looking into Latvia’s program for bond investors.
So, there are the eight countries where investing in bonds, in debt — government or corporations — will get you a residence permit and possibly even a passport.