America is – or instead was – the land of opportunity, attracting immigrants from all over the world who want to build better lives for themselves and their families. Still, to this day, many move to the US hoping to live the so-called American dream.
Perhaps you’ve heard stories about Europeans who left everything behind and bet on America. Plus, if you’re American, that might even be your own family! The problem is that today's America is quite different, and recent events have proved it.
Confiscatory taxes, high costs of living, crime and unsafety are common concerns my clients have, prompting them to find a plan B to secure their new lives abroad. Around 40% of Americans could be eligible for a second passport, according to Forbes. Your bloodline could help you make your expat dreams come true.
But if you can’t opt for that ancestry route, no worries; I’ll show you other ways to get a second passport and live a different life. Having a second passport as an American is more important than ever before.
Venice, Italy
The once-coveted American passport is not as powerful anymore. Among other disadvantages, Americans will soon need what amounts to a visa to enter the EU. The American passport does grant visa-free access to multiple countries, but in this regard, many EU passports outcompete it. For example, if you have Italian heritage, you might be eligible for Italian citizenship, allowing you to get one of the second-strongest passports in the world.
In an increasingly globalized world, where governments are complicating travel and making you deal with endless paperwork, a single passport can be limiting. If you just have a US passport, that dream trip could be ruined because you need a visa that takes weeks to process.
As an American, travelling on a whim is not that simple anymore. Getting a second passport – whether through ancestry or otherwise – will allow you to explore other countries more freely.
You might have heard the saying over and over again, “Don’t put all your eggs in one basket.” It’s not just a cliché; it’s a massive piece of advice.
Bank collapses, the threat of CBDCs, political instability and more dangers could rattle things up. Having your ties in one country is not viable anymore. Just like you need to diversify your investments, a second passport allows you to diversify on a personal level.
Let me give you another example: while many states in the US imposed lockdowns, masking and even “medical papers,” in Sweden, you could’ve lived a perfectly normal life. What if you had Swedish ancestry? You might have been eligible for Swedish citizenship to avoid all that madness.
A second passport is a safety net, the key to unlock more freedom and opportunities that your US passport is simply unable to offer. Life is unpredictable, but instead of being a feather in the wind – or a victim of the whims of bureaucrats – you can take more control over your life. If things get out of hand in the US, a second passport is your escape hatch.
New York City, USA
There’s no debate: the US is one of the most aggressive tax jurisdictions in the world. Despite all the loopholes, Uncle Sam is now greedier and waiting for you to pay your ‘fair share.’ In recent years, some marginal income tax rates decreased on a federal level, but there are still other taxes out there.
The IRS has its prying eyes on you just for making money, especially if you’re successful or say something the government doesn’t like. All the neo-Marxist and Social Justice narratives don’t help either. Plus, it’s almost impossible to spend a single penny without paying some sort of tax.
Do you buy a house? Property tax.
Do you buy food? Sales tax.
Do you drive? Toll-booth tax. And fuel taxes, among others.
The list goes on and on. The very things you need to live a normal life are taxed. But here’s the kicker.
A second passport can be tax relief, allowing you to keep more money in your pocket. Even though Americans are taxed on their worldwide income, you can enjoy the Foreign Earned Income Exclusion (FEIE) if you meet certain requirements. In other words, if you play your cards right, a second passport can help you keep some of your money off the taxman’s radar.
Business is the realm of opportunities and risks, but having just an American passport might not open as many doors as you’d like. Many foreign banks don’t even want to do business with Americans. On top of that, language barriers, confusing regulations and bureaucratic labyrinths make the job more difficult. Investing overseas with your US passport can’t offer you clear outcomes for your efforts.
Sometimes, the rules are uncertain, making you lose time and money. However, a second passport allows you to invest more easily since regulations are less burdensome and opportunities are broader.
A second passport is akin to the fast lane toward more financial freedom instead of being stuck in traffic – less red tape, fewer headaches and faster progress.
Miami, USA
As an American, you’re used to high healthcare costs. Not only do you pay high taxes, but also thousands of dollars in insurance. My clients freak out when they discover it’s possible to get amazing healthcare for a fraction of the cost in other countries.
The US government makes you pay high taxes, but they give nothing in return. All those confiscatory taxes are there to make your life more difficult and fund policies you likely disagree with (e.g. wars). There’s no “Shangri-La” perfect country, but there are better countries where you can keep most of your money and still get top-notch health insurance for a better price.
Medical costs can vary significantly from one country to another. With a second passport, you can optimize costs while maintaining high medical standards. Picture surgeries, specialized treatments or medical procedures for a lower price tag. This is medical tourism, which means travelling abroad to receive high-quality, cost-effective medical care.
This is probably the most delicate question you may ask yourself as an American. Renouncing the citizenship of your home country? It’s normal to have mixed feelings, I get it, but in some cases, it makes sense to take this bold step. Many clients of mine have renounced their US citizenship and now live life on their terms – fewer taxes, more freedom and the lifestyle they wanted.
However, it’s not all sunshine and rainbows. Sure, on the one hand, you break free from stringent tax obligations and the complexities of US regulations. You can also improve your financial privacy. On the other hand, the infamous expatriation tax, compliance requirements, and procedural intricacies require careful consideration.
As you can see, the US will rip you off even when you want to move abroad and build a better life for yourself. Again, America is one of the most aggressive tax jurisdictions in the world, and this exit tax is another proof of how greedy the government is.
Blue Mosque in Istanbul, Turkey
If you had a second passport, you could choose the country you wanted to live in. You could legally spend six months in 1 country and six months in your other country. A second passport opens a new realm of possibilities. Here are some routes for you to get it:
As an American citizen, you’re likely to have foreign roots. Above, I have given you two examples, but depending on your case, you might be eligible for other citizenship. This is known as jus sanguinis. Countries like Ireland, Spain and Italy offer their own citizenship-by-ancestry programs. Make sure to check your family tree, and you might find that getting a second passport is easier than expected.
Marrying a foreign national could also be a fast lane toward your second passport. Sometimes, it’s not possible as your spouse or partner’s country doesn’t allow for double citizenship, but maybe for residency. Countries like Colombia, Mexico and Switzerland offer their citizenship-by-marriage programs.
In one of my recent podcasts, I talked about my experience getting a Turkish passport by investment. I strongly encourage you to listen to it to know the ins and outs of the process. This pathway might be one of the most expensive, but if you have the financial means, go ahead and “buy” a new passport.
Many countries allow for naturalization as a pathway to obtaining citizenship. This process often involves residing in the country for a specified number of years, demonstrating language proficiency, and passing a citizenship test.
Certain countries offer work visas that may lead to permanent residency or citizenship. Securing employment in a foreign country or being sponsored by an employer can be a route to gaining a second passport. Some countries also offer citizenship by enlistment (i.e. military service).
Zurich, Switzerland
Once the beacon of opportunity and dreams, America has changed for the worse. Recent events and shifting dynamics have proved once again the need for a plan B, a way to secure a better life beyond the confines of the US. The American Dream is just that – a dream.
This article has covered some of the benefits of a second passport. From more freedom to financial flexibility, a second passport is your golden ticket to a new life abroad. If you decide to renounce your citizenship, you must deal with certain issues; however, for many of my clients, this bold move made perfect sense.
All in all, a second passport is necessary for every American who cares about freedom and prosperity. It can be the tool you need to live life on your terms like other fellow expats. If you’re willing to get a second passport, remember that you can work with me, and I’ll help you find a tailored strategy.
Written by Mikkel Thorup
Mikkel Thorup: May 3, 2024
Many people value privacy for personal reasons, but it’s also one of the key elements to business success. While other factors like tax efficiency,...
Mikkel Thorup: May 2, 2024
When the notorious John M. Keynes advocated for excessive government spending to achieve so-called full employment in the economy, free market...
Mikkel Thorup: April 30, 2024
Avid readers of Expat Money know we have many articles about acquiring second passports— an essential element of any well-rounded Plan B strategy....
.png?width=450&height=225&name=Expat%20Money%20Logo%202023%20(3).png "Logo - Expat Money")
