Millions of U.S. citizens live abroad, mostly for work or retirement. But increasingly I’m hearing people talk about moving away from the U.S. because they think they can be freer someplace else.
What’s going on? And why should it matter to you or me? Chances are, if you value freedom and think it’s being destroyed in the U.S., you still believe it’s wrong-headed, maybe cowardly, to leave.
Yet gradually, more go. They see economic and social storm clouds gathering. They don’t want to be here when the storm breaks. One of these people is Sandy Sandfort. He currently lives in Panama (where I visited him several years ago), but has also lived in Singapore and Costa Rica and is thinking about relocating to Chile or Paraguay.
He nags me to get out. I think about it—but stay put. I’ve asked Sandy to talk about some of the pros and cons of moving offshore.
CW: Most Americans, even those who see danger ahead, don’t want to leave. Didn’t you feel unpatriotic or as if you were abandoning the U.S. when you left?
SS: Yes, it made me uncomfortable. However, nearly all of us have ancestors only a few generations back who left their birth country to move to America. Some were fleeing religious, ethnic, and political persecution. Some just wanted better opportunities. Unless you consider your ancestors to be “unpatriotic,” you shouldn’t think that about those who are leaving the States for similar reasons. In fact, many people who served in the U.S. military are retiring in Panama and other countries on their military pensions. Are they unpatriotic?
CW: Some might think so. From what I hear, many of my freedomista friends believe they can make a difference if they stay. Are you advising them to “cut and run”?
SS: For those who believe it’s their duty to stay and fight, I say there is no right answer. It’s a personal choice, but one that may have serious consequences for them and their families.
CW: Which brings us to personal issues. Most of us have lived our whole lives in American culture. I’m afraid that what I don’t know about an alien culture could hurt or even kill me. How did you deal with that in the countries where you’ve lived?
SS: Very carefully. I’ve made mistakes— but I’m still alive. First, you have to realize that people are 99% the same everywhere. They have friends, love their families, have jobs. Most people in the world actually like Americans, though they often don’t like the U.S. government. I’ve found people to be helpful and informative wherever I’ve lived or visited.
CW: But we’ve all heard horror stories about Americans being robbed, cheated or otherwise taken advantage of in foreign countries.
SS: Hey, it happens in the U.S. too. In any case, have you ever met anyone who personally suffered extremely unfair treatment overseas? (Aside from being taken advantage of by taxi drivers; but that also happens in the U.S.) When we hear those horror stories, we only hear them third-hand from the viewpoint of the “victim.” I’ve seen Americans get into trouble in foreign countries. In almost every case, the American was at least partially at fault. For example, a man I know has been cheated, robbed, and had his business broken into. But his behavior is careless (like falling asleep on the beach) and he refuses to get a lawyer. Here you need one for any business or for dealing with the police. He also has a superior, us-against-them attitude.
CW: Most Americans don’t speak a second language. Despite being able to mumble a few words in Spanish, I felt vulnerable wandering around Panama. I don’t think I’m alone there.
SS: You’re right, language can be one of the most difficult problems to overcome. After a dozen years in Spanishspeaking countries, my Spanish still sucks. However, it’s good enough to handle most daily interactions. In Latin America, you’ll find English speakers in the cities, tourist areas and real estate offices. But not in the boonies. The ability to make expressive faces, do pantomime, and draw pictures is a must.
CW: When you’re talking about expatriation, you’re talking about other big things—like leaving family and friends behind.
SS: I don’t think moving abroad with your kids is much more difficult than moving with them within the U.S. Education might be difficult unless you homeschool or there are English-language schools where you settle. As far as aunts, uncles, and cousins go, these days you can keep in touch with anybody anywhere. Haven’t you ever heard of Facebook? Or Skype? Another thing: some of your relations may think you’re crazy for leaving the U.S., but if the shit hits the fan, you’ll be there to offer them a soft landing.
CW: Okay, but there are still serious practical problems. How do you make money if you leave the U.S.? I can write anywhere, but that’s not an option for most people.
SS: That can be difficult. Most countries make it hard for foreigners to work. There are exceptions, such as Chile, where employers are permitted to hire foreigners with little or no hassle. Also, almost all countries are open to people who start businesses and hire locals. Finally, there are many work opportunities in the informal economy. You can provide services for other expats, yachties or locals who need your talents. For example, you could be an English tutor for private clients.
CW: Uh oh. When you say “informal economy,” I hear “low pay.”
SS: Guilty as charged. But don’t forget: though income may be lower, so is the cost of living throughout Latin America, Africa and much of Asia. As far as getting in trouble, as long as your services are needed and you keep a low profile, getting into trouble that $20 won’t fix is rare.
CW: Bribery? Ugh.
SS: Yup. In Panama, for example, the fine for not wearing a seat belt is $75, but a $5 “fine” paid directly to the officer should be more than enough. If that offends you, you can always go to court and pay the $75 official fine.
CW: Speaking of money, though— another problem. Americans are having a harder time opening bank accounts in foreign countries. A friend of mine even had to fly to Switzerland to shut down a pre-existing—perfectly legal, properly reported—account. The bank was just kicking out all Americans because the U.S. government is making it too hard to deal with us.
SS: True. For many offshore banks, having American account holders just isn’t worth the U.S. government hoops they have to jump through. Even banks that still accept Americans are extorted by the U.S. government into requiring that U.S. “persons” agree to let the bank disclose their balances, account activities, etc. You either reveal everything, don’t use banks at all, or use alternative payment and depository systems.
CW: I understand that’s why the number of Americans taking the drastic step of giving up citizenship is rapidly growing. And it’s not just rich people, but also ordinary Joes who suddenly find that being an American outside of America is making life hard for them. But what do you mean by “alternative” systems? Bitcoin, precious metal accounts, and so on? I don’t trust those.
SS: If you don’t know enough about specific alternative systems, you’re probably better off opening an account and complying with whatever disclosure is required by the bank and U.S. law. Fortunately, foreign banks that have signed onto the U.S. disclosure programs are becoming enthusiastic again about accepting American customers. Some will even open an account by snail-mail or email, without requiring you to show up in person.
CW: Sandy, you and I aren’t young, and even if we were, accidents happen. What about health care? I don’t want to get sick or injured in a country with third-world hospitals.
SS: You’re behind the times, Claire. That was a lot truer in the 1950s. Today, health facilities in virtually every major world city are on par with U.S. standards. In fact, a high proportion of Latin American doctors were trained in Europe, the U.S., or Canada. What isn’t on a par is the price. Costs of medical care, health insurance, physicals are lower than in the U.S. The last time I visited an English-speaking internist, he examined me for half an hour and only charged me $30.
CW: We talked about countries not wanting U.S. citizens in their banking systems. But more and more do want us in their medical and economic systems. You hear about “medical tourism.” What you don’t hear as much is that a lot of countries actually offer deals to get foreigners to move in, retire, or set up businesses.
SS: Correct. Actually pretty much every country in Latin America has special programs for Americans and other foreigners. Many countries in other parts of the world do, too. Some favor retirees by giving them big discounts on a wide range of goods and services. Others favor entrepreneurs and investors. Still others favor real estate developers. Each country’s programs are different, but almost all give some favorable treatment to foreigners.
CW: Any final thoughts?
SS: We talked about bribery. You didn’t like it. But watch: you’ll see more bribery in the U.S. as the economy comes unraveled. Even now in the U.S., you can be fined huge amounts for piddly infractions. At least with the corrupt politician or cop, you get a chance to negotiate. Here’s another big thing: during nearly a dozen years in Panama, I have never been asked to produce “my papers.” Not once. There seems to be a higher degree of live-and-let-live attitude in Latin America than in the U.S.
Sandy Sandfort has written several reports on offshore living and investment and is currently working on a related book. If you have any questions about Panama, the expat life, or other topics, contact him at sandy@privilegedcommunications. com.