Dateline: Tbilisi, Georgia
I have become a big advocate of economic citizenship and I’m giving you an inside look at the experience. As one of the few people in this industry who shares his unfiltered experiences of planting flags, I thought that it was about time people got a real-life perspective on the citizenship by investment process.
My decision is based in part on the notion that — while many of our readers are seeking second citizenship by investment as an insurance policy against all sorts of potential problems — only a small percentage are serious enough to spend what it takes to legally get the process done quickly.
With all of the turmoil in the world, having “citizenship insurance” is more important now than any other period in our lifetimes.
The United States already taxes its citizens on their worldwide incomes no matter where they live and doesn’t seem to have any plans to stop. Other western countries are following in their footsteps by tightening conditions to become non-resident tax-payers, particularly in the EU and Australia.
Meanwhile, the fact that terrorism is increasing and freedom is being attacked in so many places (most turbulently Afghanistan, Iraq and Nigeria. Absolutely not recommended right now) means the crackdown on our freedoms is likely inevitable.
Consequently, citizenship by investment is something more people should be looking at. For one, the process is straightforward: you write a check and you’ll get a passport.
Depending on the size of that check, the passport you get will either be an absolute “Plan B” you keep in a sock drawer in case of emergency, or a potential Get Out of Jail Free card from high taxes… or somewhere in between.
Removing The Economic Citizenship Obstacles
As attractive as a second citizenship may be as an investment, many people still hesitate when it comes to citizenship by investment. As I see it, there are two reasons economic citizenship isn’t more widely considered:
- It’s hard to pay $45,000+ for a red, blue, or green little book as an insurance policy. Even if you plan to use it immediately — for example, to renounce your citizenship — it can still be a tough pill to swallow. It’s often easier to stick with the ongoing pain we already know (such as high taxes) than suffer a much shorter-term pain to stop the hurt.
However, there are second passports where you can obtain second citizenship. One route that’s open to you is to be eligible for citizenship by descent. Now, if you’re wondering whether to take up such a free passport, just consider the pros and cons of obtaining it.
- There isn’t a lot of credible information about citizenship by investment for the average person. Surely, there are a number of reputable firms in the citizenship by investment space, but they tend to be particular. They are not only fixated on ultra high net worth investors, but also on the Arabs and Chinese who make up the bulk of the market. Westerners aren’t huge consumers of economic passports because most of them think everything in their country is wonderful. If you’re up for it, take a look at the best citizenship by investment programs that we recommend for 2021.
However, as recently outlined in case studies about US citizenship renunciation, plenty of people could benefit from a second passport. These people don’t have to wait three, five, or even ten years to get one.
If your life depended on you leaving your country and having a safe place to go, or if you were bleeding thousands of dollars per week in taxes, the need might be more urgent. You might not need a passport right away but just paying once and getting it over with saves precious time.
So I decided to take the plunge myself.
For me, economic citizenship with investment is part of a balanced approach; for you, it might be the only way to get second passport. It might also be an extra layer of protection beyond European citizenship by descent (with future tax risk) or naturalization after residency (with risk of not being issued in the future).
Reasons to Get Economic Citizenship
As with all things we talk about here, the first step is to understand why you want or need something.
In this case, what would justify the decision to get an economic citizenship with investment? Here are several of the reasons I have for writing the check and getting a fast second passport…
It Fills in Visa-Free Travel Gaps
A US passport also excludes Brazil and requires e-visas to visit several countries like Turkey.
And, of course, many other communist countries like Belarus and most African countries are off-limits to western passports. Interestingly, these countries are not necessarily off-limits to developing nation citizens.
Namely, obtaining Panamanian citizenship by the Friendly Nations Visa program may work for you (if you have years to wait). But if you wanted to enjoy uninterrupted travel to Hong Kong, most of the economic citizenships with investment — Dominica, Comoros, Antigua, et.al. — would fill in the gap your Panama passport left you.
Economic citizenship with investment, as well as some emerging world passports earned through residency, can even complement your current passport. Georgians, for example, can visit Turkey, Belarus, Azerbaijan, and even Brazil while US citizens can’t. If you don’t have the connections or the desire to wait for an emerging passport, economic citizenship with investment can help.
It Reduces Cumbersome Tax Procedures
Having been born in the United States, I’m especially prone to rules. That’s not to say I’m a fan of rules; after all, I go where I’m treated best to avoid the worst rules. However, I still cringe whenever I hear someone from Greece or Romania or wherever say “Ah, I just won’t report that income on my taxes”.
I believe in obeying the law, not because I necessarily agree with it, but because I don’t want the loss of freedom that comes with not doing so.
The benefit of becoming a citizen of countries that offer economic citizenship with investment (with the possible exception of Malta and Cyprus) is that they don’t particularly care. As a US citizen, I’m still bound by rules affecting US citizens worldwide. But having citizenship with investment is just another arrow in my quiver should I later choose to distance myself from the United States.
However, being a citizen of a country that doesn’t track your every move is a welcome change. No country selling citizenship (with the possible exceptions of EU countries) has burdensome procedures for becoming non-resident for tax purposes. None of them require you to fill out FBAR forms to report your bank accounts everywhere in the world. Being a citizen of a less burdensome country feels good, and it offers hope for the future.
“Be the change you wish to see in the world.” Right? While the price tag may scare some, and not everyone is a good candidate for economic citizenship, many people who read this site could benefit from investing in a passport. This project is to help people like you become more comfortable with the process of economic citizenship with investment.
Economic Citizenship Is A Legitimate Path
Google “how to buy a passport” and you’ll find all sorts of credible news agencies from CNBC, CNN to Bloomberg. They have written about the process of investing to getting citizenship. None of them, however, seem to smile upon the practice. Instead they paint it as a jestful foible of the rich or a slap in the face to common decency.
The reality is that making a donation or an investment in a country is perfectly legal. Even Hillary Clinton acknowledged that when she went to Dominica in 1993 in an attempt to bully the country into shutting down its passport program. The government told her they’d be happy to, if the US government offered to cover their income from selling passports. An offer which was declined.
Just because bureaucrats who want to seal off the exits don’t like something, that doesn’t make it illegal. Unfortunately, there are so many scammy websites offering to make you an ambassador from some African country for $5,000 or to get you Panamanian citizenship in six weeks if you ask nicely, that the general public is easily convinced that citizenship through investment is a scam used by evil tax evaders.
What Economic Citizenship through Investment Has Taught Me
I’m truly open to changing my mind when circumstances change. Five years ago, I was enamored by the idea of buying a passport but too cheap to actually do it. (Not to mention my family saying, “do you know what you could buy for $100,000?!”)
In fact, you could find an example of me advising against citizenship through investment in one of my earliest articles. In the years I’ve been living the Nomad Capitalist lifestyle, I have increasingly realized that reaching my goals that range from reducing taxes to achieving greater personal freedom- everything has a price. Today, more than any time in my personal history, I’m devoted to spending what it takes to solve problems. And yes, I enjoy myself a little.
One thing I’ve learned is that adapting is important as a Nomad Capitalist. Trends, laws, and attitudes change every day. If you want to “go where you’re treated best”, you need to be open to new ideas. It’s hard to achieve your goals when being dogmatic. This is how one has to be if they require to indulge in the art of economic citizenship.
A few of my opinions on some “gray area” issues have changed. I have been presented with more facts and it’s only logical to change my mindset based on which. Time will only tell where our stories will lead us. If you’re interested in taking control and writing your own chapter, set up a call with us and let’s see how we can help you on your Nomad Capitalist journey.