A book by Andrew Henderson “Nomad Capitalist: How to Reclaim Your Freedom with Offshore Bank Accounts, Dual Citizenship, Foreign Companies, and Overseas Investments”
Live where it makes the most financial sense
How can you enhance your personal freedom, keep more of your money, and grow your money more effectively by taking advantage of what other countries have to offer? That’s what Andrew Henderson covers in his book Nomad Capitalist.
Just like moving from California to Nevada can save you 10-15% in your income taxes, moving from the US to Panama could save you almost 100%, assuming of course that you renounced your US citizenship since the US taxes you on globally earned income.
To find the best countries for citizenship and investments, the author has traveled to 90 countries and now advises entrepreneurs how to find the best countries based on their objectives.
Why become a Nomad Capitalist?
Because you should “go where you’re treated best.” No matter where you were born, there are opportunities to either change your citizenship or acquire two – or more – passports.
Different countries have different tax rules. So by becoming a foreign citizen, setting up offshore accounts, or setting up companies abroad, you can shield your income from high-tax jurisdictions. In fact, the author has reduced his global tax rate from 43% to 1%.
Also, different countries present vastly different investment opportunities. The author likes investing in commercial real estate and can find opportunities that can generate even 20% annual returns.
In some countries, citizens have exclusive access to the best real estate or business investment opportunities. That happens because the local government may want to limit foreigners from buying up all the real estate as a way to keep prices affordable for its citizens. So a foreign passport can give you access to such unique investment opportunities
A different investment example is peer to peer lending, where in Europe you can do significantly better in terms of risk-adjusted returns for your money compared to the US. The problem is that you need to have a European passport to participate.
Think of it as diversification
At the end of the day, establishing foreign bases through investments makes sense as a way to diversify your lifestyle and financial risk. If something happens to your country, you can seek shelter in another where you’re also a citizen.
The biggest challenge is getting started. Don’t plunge in head first because it can be overwhelming. Take it slow and approach it methodically. Take a trip for a couple of weeks to a place and see how you like it. After you try a bunch of places, narrow it down to your preferences. Then, do what the author does and hire the best lawyer you can find, one who has experience working with foreigners, and start exploring opportunities.