Americans Are Ready to Say Goodbye to Uncle Sam & Hello To A Second Home
I’m a “dual expatriate.” Twice in my life I’ve left the country where I was a citizen and moved to another one.
Maybe I just have itchy feet. But when I look back at the decision-making process that led to my moving abroad, one thing stands out: I did it because I could. There was nothing stopping me. I regard anywhere on the planet as “just another place to be me” … in fact, that’s my personal motto.
When I first moved abroad in the early 1980s, however, I was an outlier in the U.S. Most of my peers hesitated to move to another town, much less to the other side of the planet. But that’s changed … big time. Now, more than half of Americans in their prime working years say they’d consider moving abroad in a heartbeat.
But where would they go? How would they choose where to expatriate to? Fortunately, that’s a subject to which I’ve devoted a lot of thought…
Americans – Moving Abroad for a Better Life
A recent survey of more than 2,000 Americans by a British money-transfer firm found that over a third would consider moving abroad. Among those aged 18 to 34, 55% say they’d consider moving abroad.
There’s both motive and opportunity at work here.
According to the survey, enjoying “a better quality of life” and “lower cost of living” abroad were the most popular reasons to consider relocating to another country. According to the survey results, life in America is undermined by expensive health care (chosen by 55% of respondents), lower taxes (51%) and poor education (48%). Indeed, in a recent ranking of global quality of life, there is not a single American city in the top 25.
Regarding opportunity, Americans, especially the younger generation, have embraced the innovations in communication, transportation and financial technologies that make it easier and cheaper to move in search of an easier life. As I show in my Plan B Club, these days living abroad is little different than living where you happen to be.
But where do you go?
Americans – A Process, Not a Prescription
People constantly ask me which country is right for them. I usually resist giving a direct answer. This is a decision based on unique personal variables, I say. I can’t decide for you. But I can give them a successful, demonstrated process that will help them decide. It can do the same for anyone.
I start the process by grouping life into four cornerstones — Lifestyle, Relationships, Home and Possessions, and Wealth. The optimal life is where you strike the right balance among these different things.
For example, many countries that rank high in financial freedom are downright boring places to live, with a high cost of living to boot. By contrast, some of the most delightful places to spend your days and nights have irritating quirks, such as odd social rules or subpar utilities. Whether those things are tolerable or not, given the attractions, is a matter for you to decide.
To help make that decision, my Plan B Club offers a planning matrix and decision-tree that can help you rank different possible places according to your own preferences. And to reveal those preferences, I provide a questionnaire designed to test your tolerance for things like ambiguity, delays and loss of creature comforts — as well as the extent to which your spouse shares (or doesn’t) those characteristics. That’s important.
Americans – An Example: Costa Rica
Costa Rica is a favorite among U.S. expats. When I apply my personal preferences to it, it scores highly on lifestyle, relationships, and home and possessions issues. It has a great climate, friendly people, excellent medical care and a reasonable cost of living.
But … it’s getting crowded, and expat life there can be insular. And the government is considering taxing offshore income, a move clearly designed to generate some revenue from all the Yankees who live there.
On balance, personally, I’d move to Costa Rica with no problem at all — especially the Pacific coastal region around the Parque Nacional Manuel Antonio. I once spent a Sunday there hanging out with tree sloths and parrots, swimming at the most pristine beach I’d ever seen. The beer and seafood were cheap and excellent.
But someone else may find a different balance. If I had complex investment and tax arrangements, I might find that the looming imposition of a global taxation regime for Costa Rica offsets the benefits. In that case, I’d probably go to tax-friendly Panama, which is right next door … and connected to Costa Rica by the Inter-American Highway.
Americans – Treat It Like an Investment
It always amazes me how some folks can devote extraordinary intellectual firepower to financial decisions, while making life choices on a whim.
Of course, if you have sufficient wealth to burn, you can always afford to experiment with places to live. But for most of us, it’s a critical decision … an investment in your own happiness.
Treat this life choice like an investment, and get the help and insight you need from resources like the Plan B Club. The growing number of people moving abroad while using it as a guide tell me it works.
The post Americans Are Ready to Say Goodbye to Uncle Sam appeared first on The Sovereign Investor.