Your Get Out of Jail Free Card

  • A second passport gets you out of jail and opens up possibilities.
  • Whether it’s through ancestry, marriage, or investment, getting one is worth it.
  • Let’s review the ways you can acquire a new passport.

Happy Thursday from Asti!

There are days when I get down on my knees and thank God.

Today is one of those days.

I shudder when I think of the mess I’d be in right now without my Italian passport.

I’d probably still be stuck in the Philippines.

Or trying to enter the UK with my non-EEA spouse.  Though if we took the boat route, we’d get free accommodation and a stipend.

Who knows what the game plan would’ve been?

But having that get-out-of-jail-free card was a godsend.

Possessing a second passport gave me the most important thing in the world: options.

The option is to live in Italy – or any of the other 26 European Union countries.

The option to arrange my company and tax status the way I wanted to.

The option to bring up Micah in a lovely country.

No country is perfect.  No one plan fits all.

Will Italy be in economic trouble because of the EU’s idiotic policies toward Russia?

Probably.

Will that affect my family and me?

Most certainly.

But it’s a cost I’m willing to pay.

For now…

In this edition of the Rude, I’ll talk about some options you may not know you had… and why you may want to exercise them now.

There’s No Time Like the Present

Dr. Lev Borodovsky’s Daily Shot usually comes out after I’ve finished writing the Rude.

But as I was late today, I read it first.

He had some germane charts I wanted to share with you.

First up is how housing has become increasingly unaffordable in the US.  No surprise there.

But the rate of decline in affordability is frightening.

To corroborate our first chart, we’ve got another chart showing how many renters are moving out to buy a home.

It’s only 42.9%, a low number compared to recent years.

Next up are the Congressional Budget Office’s budget deficit projections.

The US is getting deeper and deeper into debt.  It looks like there’s no relief within the next ten years.

Last, the USD has skyrocketed this year against most currencies.

But it seems emerging market currencies held up much better than developed countries’ currencies.

If you want to head to Latin America or Southeast Asia, that’s a good sign.

All in all, it’s a pretty good time to get out of Dodge.

But how can you do that?

A few ways, but the plainest is getting a second passport.

Different Ways to Get Citizenship

My son Micah has three passports.  His British and Italian ones come from me—his Filipino one from his mother.

I decided to renounce my US citizenship before he was born so he wouldn’t have to suffer being an “Accidental American.”

​​An Accidental American is someone whom US law deems to be an American citizen but who has only a tenuous connection with the US.

Accidental Americans get taxed as regular Americans thanks to citizenship-based taxation.

I didn’t want that for him, nor did I want to continue paying taxes to a country I rarely visit.

Luckily, I had options.

You may have the same options as well.

Ancestry

I tell everyone in America this.  If you have a last name that ends in a vowel, you should check out your country of ancestry’s citizenship laws.

Thanks to a bit of digging – and a lot of document collecting – I was able to get my Italian citizenship.

In total, I estimate this process cost me $10,000.  $6,000 in lawyer’s fees, and the rest was expenses.  I had to fly to many countries to secure my documents and get them apostilled.

An apostille is the international version of notarization.

Your family may have been in America for too long for this option to work for you.

That’s ok.  There are other options.

Investment

Citizenship by investment’s window is closing.

If you’re interested in this form of citizenship, you need to move five minutes ago.

Andrew Henderson of Nomad Capitalist is the go-to source on the subject.

He lists the six ways to get citizenship by investment:

    • Direct Citizenship
    • Semi-Direct Citizenship
    • Golden Visa
    • Residence Permit
    • Active Investor Visa
    • Fast Track Citizenship

And a bonus section:

    • Easiest Countries to Getting Citizenship

Watch his Six Ways to Get Citizenship by Investment video to get the full details.

Marriage

I’m sure you’re too smart to marry someone just for their passport.

Please don’t take this section as an encouragement to find a partner just for their passport.

But… if you’re already married to someone who has a foreign passport, you can potentially unlock some options.

Interestingly, it would take me an entire decade to get a Filipino passport by marriage.

So that didn’t work for me.

But what did work was taking advantage of residency privileges.

Second Residences Work Well

I still laugh about this.  In 2018, the only country in the world where Pam, Micah, and I could legally reside together without issue was the Philippines.

I didn’t have my Italian passport yet, and the UK’s immigration laws are beyond stupid.

Sure, we could have emigrated to Spain in the hopes of her getting a Spanish passport.

(It’s relatively easy for Filipinos to get Spanish citizenship, as they are former members of the Spanish Empire.)

But the Philippines provided us with the tactical retreat we needed to complete my Italian paperwork.

Remember, you don’t have to move to a country forever.

You can go there, take advantage of the tax system, and enjoy your life.

Then, you can leave.

The Philippines has a territorial taxation system, so it was even better for me.

US citizens get a foreign earned income exclusion of $112,000 (currently).

So if you’re on a fixed income below $112,000, you’ll live in those countries tax-free.  

Wrap Up

The West is a mess, but you have options.

A second passport is your get-out-of-jail-free card.

You can get a second passport by ancestry, investment, or marriage (if you must).

If you can’t get a second passport immediately, a second residence is a smart move.

Even if it’s a tactical retreat, you can take advantage of the tax laws in your second residence country.

Piano, piano,” as they say in Italy.

It translates to “very quietly” or “softly, softly.”

You don’t have to pick up in a huff and shove off to a foreign land.

You can take your time, examine the advantages, and dip your toe in.

Once you’re sure, make the move.

Until tomorrow.

All the best,

Sean

You May Also Be Interested In:

5 Things You Can Do With an Old 401(k)

If you’ve recently changed jobs or you’re thinking about making a move, don’t forget about your 401(k) or 403(b) with that employer. One misstep can cost you thousands of dollars in retirement savings if you’re not careful. Whether you’re switching jobs or simply have forgotten about an old 401(k) from a previous employer, there are really only five things you can do with an old plan...