Passports? I’ll Take Two!

With all the geopolitical messes around the world, there’s no better time to start planning for a second passport than now.

Whether it’s for moving to a new country, giving your children other options, or just plain old financial planning, having a second passport opens up doors you may never have thought of.

It’s a big move for most people. But once you start the process, you’ll wonder why you didn’t do it earlier.

I’m sitting in New York City as I write this. When I was a young man, I thought my entire life would be lived in and around this city.

Though I’m enjoying myself immensely, I can’t tell you how happy I am to be flying back to Italy this Friday night.

Before we begin, a simple warning: as always, only make life-altering decisions after talking to your accountant, lawyer and family.

“We have a package for you, Commander Bond.”

“Mr. Ring,” the receptionist said, “we have a package for you.”

I was in the Intercontinental Hotel in Abu Dhabi in 2008, teaching a CFA Level I review course for one of the big companies there.

“Thank you,” I said to the lovely lady, as she handed me the DHL envelope.

I went to the elevator and pressed the button. Upward I ascended to my floor. I got out, looked left, turned right, and headed to my room.

As I removed my card key, I looked around to be sure nobody was watching me.

With my door unlocked, I entered my room and put down my computer bag and the package.

Smiling, I grabbed the tear strip on the package, pulled hard, and removed the contents.

My American passport, with the requisite Russian visa for my trip to Moscow, was in the package.

I could breathe a sigh of relief. The trip to Moscow was a go!

I’ll tell you, pretending you’re James Bond — even if you’ve got a 40+ inch waist and a bald head — is one of life’s great pleasures!

Let me take you back a few weeks prior to demonstrate why that whole exercise was necessary.

My company’s London office:

“Seanie, we’ve got an issue.”
“What’s up, my friend?”
“You’re scheduled to be in Abu Dhabi and then fly straight to Moscow via Amman, Jordan.”
“There’s just no way we can get your UAE visa [you needed one in those days] and your Russian visa in time for the trip.”
“Ugh… Wait a minute.”
“What if we use my UK passport to fly to the UAE? Get that visa done first. While I’m in Abu Dhabi, you can use my American passport to get my Russian visa done. And then you can mail my US passport to me at the hotel. Then I can teach both courses, and we’ve got no issue.”
“I think that works!”

That was one of my most fun teaching trips just because of the passport kerfuffle. And the advantage of having a second passport is self-evident.

Playing with your visas is just one of the options having multiple passports affords you.

Still — and Forever — The Yank

Even when I lived in London for over six years and had just received my UK citizenship and passport, I was “The Yank.”

It was fine with me.

Some people think it’s weird when I say “we” concerning Americans, but the truth is this: you are who you are.

I eat, drink, think, and feel like a Yank. Actually, I think like Americans who aren’t brainwashed… circa 1999, which is when I left.

Very few people ask about passports. But even when they do, I’m truthful.

“You renounced? Really?”

But it’s usually information gathering on how they can do the same. It must be the crowd I hang with.

Very few get upset about it. They’re usually parasitic tax eaters like government employees or union guys.

Funnily enough, military guys are more receptive than most when discussing renunciation. I guess they’ve seen the “Pentagon Rot” up close.

Getting Through Heathrow Easier

If you live in a foreign country and they don’t have worldwide taxation like America, there’s almost no reason for you not to get their passport.

For instance, if you choose to live in a high-tax country like the UK, Canada, Australia, or New Zealand, why wouldn’t you get that passport the first chance you get? (There are issues with Australia’s retirement taxation, so talk to your accountant about that.)

All else equal, a powerful passport gives you more travel freedom. But it also makes coming and going much more straightforward.

I loved my new British passport because getting in and out of Heathrow Airport is a breeze compared to doing it on a US passport.

Getting my Italian passport gives me access to the entire EU, which has many low-tax countries within its make-believe border. Estonia, Latvia, Lithuania, Czechia, Slovakia, Slovenia, Croatia, and Poland are all great countries on the up.

Banking in Your New Country

The US passport holder is persona non grata in most countries where you want to bank.

Most American expats have to bank at their local Citibank branches in their host countries because foreign banks (their new home banks) don’t take American citizens.

That’s thanks to the asinine burden of FATCA.

FATCA is the Foreign Account Tax Compliance Act (FATCA), which requires foreign financial Institutions and certain other non-financial foreign entities to report on the foreign assets held by their U.S. account holders or be subject to withholding on payments.

If you have another passport, they still won’t bank you. But now you have the option to renounce if you want it.

Renunciation is a very emotional decision. I wouldn’t even go there yet.

Just get used to having another passport around to feel that extra freedom. It’s real.

99% of Passports are Emotional — Until You Start Collecting Them

Let’s use my son, Micah, as an example.

He has his Philippine passport from his mother. It’s a pretty useless passport right now, to be honest. But one day, it may be worth more.

Micah also has his British and Italian passports from me. Now they offer options.

Micah can work with Goldman Sachs in London, one of the world’s largest financial centers. No visa is required. (I had to get a work visa to work in London as a US passport holder.)

Micah can also work in Rome, Paris, Barcelona, Munich, Madrid, and all the other European capitals and great cities. He’ll also have an easier time working in Zurich and Oslo, even though Switzerland and Norway aren’t in the EU.

With British and European passports, he’ll also be able to travel to many other parts of the world visa-free.

If you’re a globetrotter, that genuinely matters.

At the moment, Micah speaks Italian and English fluently. But it’s American English, thanks to his father’s accent. If you have young children, they’ll still be “yours,” no matter what passports you have.

As for fully-formed adults, you know who you are… and so do your loved ones.

Getting a second passport isn’t a DNA-altering experience. It’s just another key, unlocking a door you couldn’t open before.

If you can take advantage, you should take advantage.

And if you can pass on that advantage to your children, that may be the greatest gift of all.

Let me know what YOU think by emailing me here.

The Daily Reckoning