Our annual Retire Overseas Conference is primarily a lifestyle event.
The focus is on where and how to live or retire overseas.
However, the number of people at this year’s event in Houston asking questions about opportunities for backup residencies and second citizenships was significant… many more than at any other Retire Overseas Conference in our history.
Fundamentally, many of the 200-plus people in the room were looking for options. Some weren’t planning on actually moving overseas but wanted to be prepared should things back home turn in a direction that makes them uncomfortable.
They wanted to know about the best places to establish residency that don’t require you to be physically present in the country… as well as options for acquiring a second passport.
Never before have attendees at one of our retirement events been so interested in the idea of a second citizenship.
Our Residency Winners
The winners in the residency discussion (that is, the best places right now to shop for a “backup residency,” as we call it) are Colombia and Panama. These two countries offer pensionado programs that come with minimal requirements for time in the country, as well as low retirement income thresholds. Nicaragua and Portugal are strong runners-up.
If you aren’t yet collecting Social Security and don’t have other pension income, residency through investment could be your best option. If that idea interests you, Nicaragua, Ecuador, Panama, and Colombia are countries to consider.
You could obtain residency in Ecuador with an investment of as little as US$31,000. The downside to Ecuador has been that you can’t be out of the country for more than 90 days either of the first 2 years after you’ve obtained residency. As a result, residency in this country, though appealingly affordable if you wanted to live in Ecuador, has not been an ideal option for a backup plan.
As we discussed with attendees at last week’s event in Houston, though, this could be changing. In an effort to become more competitive with other retiree residency programs, Ecuador is considering eliminating or dramatically reducing the in-country physical presence requirement.
As we remind you often, residency and citizenship programs are ever-moving targets. When you find one that works for you, you should act on it.
Other countries featured at last week’s Retire Overseas Conference require at least five years of residency before you can apply for naturalization.
Five years may sound like a long time. However, in the context of becoming eligible for a second passport, it isn’t. Some countries—Andorra and Switzerland, for example—require 20 and 12 years, respectively, of residency before you can qualify for naturalization.
The best option for European citizenship right now is Portugal. Residency is relatively easy to obtain in this country, and you are eligible for naturalization after five years. Additionally, Portugal offers a residency program that comes with important tax breaks.
When considering your residency options, remember to factor in the total costs (beyond minimum monthly income requirements) when making comparisons. You’ll have attorney and government fees up front, and, if applying with a spouse or other dependents, you may have additional income requirements and fees. In some cases, you may have renewal costs for one or more years.
When choosing among second citizenship options, pay attention to the travel value of each one, especially if your intent is to give up your current citizenship.