Despite its problems, most Americans still see the U.S. as the best place in the world to live. They may enjoy visiting other countries, but then they want to come home because… simply because it’s home, with all the easy familiarity of home. It’s comfortable.
If that’s how you feel, you’ll get no argument from me. I still have fun on the Fourth of July. Your money, however, might easily be more comfortable, and certainly would be safer, living somewhere else.
Keeping all your assets at home, in the U.S., is what most Americans do, but that’s as risky as leaving your wallet on a park bench. And the stakes, of course, are much higher.
Without Offshore Safety…
You’re an easy target when everything you have is sitting in the U.S. Here are some of the hazards that could hurt you and your family if you let just one country be your entire world:
- Aggressive lawsuits that might take everything. Even though you might not be in a litigation-prone business or profession, just having above-average wealth is enough to make you a potential target for a predatory lawsuit. Every dollar you add to your net worth raises the odds that one day a process server will knock on your door and hand you a summons to attend a financial beating. You’ll be the one getting beaten.Sure, you can buy liability insurance, but insurance can turn out to be a lightning rod for litigation, since it guarantees the winner of a lawsuit an easy way to collect.
- High taxes on investment returns. Picking the right investments is challenge enough, but even when you succeed, you only get to keep part of your winnings – sometimes only half. And if your investments don’t work out, the tax collector won’t be nearly so ready to share the losses. The rules are more lopsided than in the worst casino.
- High and unpredictable estate taxes. At current rates, up to 40% of what you’re able to hold on to after paying a lifetime of income tax may be taken from your family by estate tax. To make things even more difficult, gift and estate tax rates keep changing (they’ve gone as high as 60%). The amounts that the rules exempt from tax also go up and down. Be careful. Don’t die in the wrong year.
- Over-exposure to the U.S. economy. Leaving everything in the U.S. leaves you vulnerable to economic problems at home and to the damage those problems can do to your investments and to the value of the dollar itself. Internationalizing your portfolio is essential for protecting it.
- Living with rascals. There are so many what-if hazards that deficit-dodging politicians someday might throw at you, such as currency controls, capital controls or forced sales of gold at an “official” price the government declares. And who knows what else they’ll think of? The only protection against surprising new rules lies offshore.
Using a private company or a family trust that you set up locally can soften some of those problems, but at best, such measures add up to an incomplete solution… because your assets are still in the system that has become so cavalier about taking what others have earned. Your assets are still part of the low-hanging fruit.
Choosing Where, For Real Safety
If you’re concerned about those hazards to your wealth, there’s a critical idea you may have overlooked. Critical for you and for your family. Critical for protecting what you’ve built.
You already know that you get to decide what kind of work to do and how many years you’ll keep doing it. You know you get to decide which lawyer and which accountant and which financial adviser to hire. And you know it’s up to you to choose the right bank and the right broker and to decide which investments to buy or sell.
What you may have overlooked is that you also get to pick the legal environment for your wealth. It’s a big world, and some places are far friendlier to wealth than the U.S. in 2016.
- In some countries, the courts have no patience for imaginative legal theories, claims for punitive damages, contingency fee arrangements or “sue everybody” litigation strategies. And they won’t enforce judgments from foreign courts.
- Some countries won’t tax your investment returns.
- Some countries won’t tax your estate.
- Some countries give you access to currencies and investment alternatives not readily available in the U.S.
- In some countries the government lives within its means, so it has no reason to consider the desperate measures that may tempt politicians in the U.S.
And some of those countries are in the “financial hospitality” business. They welcome and protect foreign investors. They provide the kind of healthy, safe, reliable legal environment you may be looking for.
Choosing How, For Real Safety
Choosing one or more foreign countries for housing part of your wealth is an essential first step toward safety. But merely moving assets overseas isn’t enough, because you are still here. You continue to be subject to orders from U.S. courts and other governmental agencies. You can be required to bring personal assets home. You are taxed on your worldwide income. And foreign assets you own personally will be just as much a part of your taxable estate as the assets you keep in the U.S.
If the U.S. government ever tells you to turn in your gold, don’t think saying “It’s not here” will do any good.
It’s a simple idea: how you hold assets is as important as where you hold them. Two types of powerful legal packaging explained here, in the Offshore Resource1 web site, can help you get the protection you want for your wealth.
Two sweeping solutions are available to you. One of them is stronger and has more power to adapt to unforeseeable problems, but it is more complex and costly. The other is more limited in what it can do for you, but it also is simpler and less expensive. For many investors, the best strategy is to use the two together.
Maximum safety with an offshore trust. A trust administered in a foreign country is the most robust financial planning arrangement you can have. The protection against future lawsuits and seizures can be virtually absolute, and eventually the trust can disconnect from the U.S. tax and regulatory systems — and become lawfully silent and lawfully invisible. It is the ideal environment for estate planning… and it’s the only permanent solution — safety that never quits.
For a knowledgeable investor who focuses on avoiding unnecessary expenses, an offshore trust can be cost-effective for assets of $500,000 and up. Learn more at Offshore Trusts Start Here.
Protection with an offshore limited liability company. Many offshore trust structures include an LLC as an investment holding company. (The person who sets up the trust usually takes the position as the LLC’s Manager). But just by itself, a standalone LLC organized in a foreign country and that you use to hold your investments puts up a difficult barrier for lawsuit attackers and high-handed government agencies.
It also can improve your access to foreign financial services and protect you from possible future restrictions on your investment freedom.
It is comparatively simple and inexpensive — cost-effective for anyone with investment assets of $200,000 and up. Learn more at Offshore LLCs Start Here
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