What would you do? Leaving Canada to live abroad.

[freedomseeker]

Greetings, I am a recent retiree that is lucky enough to have retired relatively young, with a decent pension (atm) and I have also accumulated just under a million in assets which i can easily liquify. As i look at my home country spending itself deep into debt (ala Argentina), governments increasingly willing to suspend peoples rights and freeze bank accounts on a whim and a general feeling that a printed money bubble is about to reap a whirlwind of economic destruction upon my country and others i am looking for options.

While my pension is tied to Canada, it is my understanding that pensions don't count on the non resident score, what i am more concerned about is diversification, asset protection of the rest of my assets. (canada atm is still a country that taxes on residence instead of citizenship, but if they get too desperate for ever increasing funds to pay for past poor economic ideas i could see that changing.

I also am planning of starting up a travel blogging, Youtube channel, for some side income as my passion has always been travel to exotic or remote locations.

So if you were me...

How would you diversify? Where would you set up your residence? How would you structure your digital income? Where would you bank? Would you set up a offshore company? Asset trust? Invest in real estate for income? ETC....

If it was you and you were free to leave, free to do what you want, wanting to protect your hard earned savings from inflation or depreciation, to live a wonderful free life...

What would you do???

 

[Martin Everson]

Welcome to the retiree club.

I also am planning of starting up a travel blogging, Youtube channel, for some side income as my passion has always been travel to exotic or remote locations.

Good idea. Especially if you have a different travel perspective than the typical air headed IG model VLOG.

How would you diversify?

Income producing assets across jurisdictions. Sadly nothing will beat art, gold and land for medium/long term capital gains. For immediate income your pension should cover that.

Where would you set up your residence?

Find one place to call your base that has a good retiree program even. You may not necessarily want tax free but rather low tax, safe and decent standard of healthcare etc. You may want to look at Curacao and its Pension Scheme.

How would you structure your digital income?

Depends where income is coming from.

Where would you bank?

Channel Islands like Jersey. Or even RBC Bank in Caribbean or local to where you plan to live.

Would you set up a offshore company?

Do you really need this. What will be its purpose?

Asset trust?

RBC offers good offshore trust options in Channel Island and Caribbean.

Invest in real estate for income?

Low cost holiday lets maybe an option. Covid won't dampen travel forever and their are some bargains to be had.

If it was you and you were free to leave, free to do what you want, wanting to protect your hard earned savings from inflation or depreciation, to live a wonderful free life...

What would you do???

Well I am retired early also. Luckily I can return home to my tax free island. I do travel also. However I have recently taken my money out of bond markets and I am planning to put into more tangible income producing assets.

Most important is to travel first. Maybe spend 6-8 months doing this before deciding where to live or base yourself. If you can film your adventures and build up good YT content then look at where to live.

 

[RealDude]

Most important is to travel first. Maybe spend 6-8 months doing this before deciding where to live or base yourself.

I traveled the world with my wife for 2 years to realize that we are best off in our home country Germany and the EU thanks to Schengen ;-) We will spend the 6 months in winter in sunny foreign countries, the summer in the EU. Germany has a strong passport with which you can enter almost all countries in the world for up to 3 months without bureaucracy.

 

[RexS9999]

I was in the same boat years ago. It really depends a lot on your pension income. Becoming a non resident for tax purposes (Canadian) is most suited for high income earners. For example Canadian airline pilots making big money. This is what a tax expert told me. Those on pensions, English teachers etc may want to continue paying into the Canadian tax system. The reason is you can return for medical issues. Among other reasons.

In my opinion if you are on a pension you may want to set your sights on a third world country. Try it for several months before cutting ties with Canada. An offshore trust with under $1 million, there are people here who know more about this. But I wonder if it would be worth it. You could put your savings in a basket of dividend stocks and use that to support yourself.

 

[Golden Fleece]

Invest in real estate for income? ETC....

If it was you and you were free to leave, free to do what you want, wanting to protect your hard earned savings from inflation or depreciation, to live a wonderful free life...

What would you do???

Years ago, this would have been easy. Just place all your funds in safe certificates of deposit for a 5% to 8% annual return. But the same "whirlwind of economic destruction" that you are trying to flee has caused artificially low interest rates that steal from savers and investors in favor of bankers. Interest rates are now so low that retirees can no longer live on the interest from their low seven-figure investments. Utterly shameful.

You could try to build a diverse portfolio of income producing properties (say $80k to $120k each) in various countries to try to replicate the returns that you would have received, in the past, from CD's in a free market capitalist economy. Live and Invest Overseas publishes much free information on offshore investment properties. Like Martin, they highly recommend living in an area before making a purchase and doing of boots-on-the-ground research before making an investment.

 

[backpacker]

Sadly nothing will beat art, gold and land for medium/long term capital gains.

Not long term! Long term is > 10 years and everybody who thinks a bit outside the box (i.e. current political environment) will find better opportunities on the stock market. The assets you mentioned either rallied already massively (art and land) or hardly keep up with inflation (gold).

Interest rates are now so low that retirees can no longer live on the interest from their low seven-figure investments.

Well, if they look a bit around and are flexible they still can. Not in Western nations, but it's easily doable by leaving these (not so comfortable) comfort-zone countries.
I know several European retirees who live happily in Northern Africa off the interest their low six-figure savings produces. Same in SE-Asia.
Of course, that does not justify the robbery of banksters and Western governments on their own population by ordering it's population to swallow up negative interest rates.

 

[Golden Fleece]

I know several European retirees who live happily in Northern Africa off the interest their low six-figure savings produces. Same in SE-Asia.

I do not see how someone lives off such an investment without converting their dollars to the local currency and placing their money in CD's in the local currency, which is extremely risky -- especially when your life savings is involved.

If you know of high interest rates for dollar CD's in offshore jurisdictions, please let us know.

 

[backpacker]

I do not see how someone lives off such an investment without converting their dollars to the local currency and placing their money in CD's in the local currency, which is extremely risky -- especially when your life savings is involved.

If you know of high interest rates for dollar CD's in offshore jurisdictions, please let us know.

• USD -> AM, EG, KH, TN to name a view. You'll be able to receive interest rates that will ensure a very low four figure monthly income by placing a low to mid six-figure amount in a CD. In the mentioned countries such a monthly income is sufficient for you to be considered a "wealthy person".
• Local currency -> high risk, as you said. I wouldn't recommend it! Still, with 12% to 15% interest p.a. the risk in EGP is (perhaps) manageable since the IMF will (most likely) not order a further devaluation anytime soon.

Note: I said "lives happily"! A Westerner does not need a fortune to enjoy his retirement in Northern Africa if he/she is able to forego a decadent lifestyle.

 

[freedomseeker]

Thanks for the replies thus far, it's good to get idea's. As per my travel blogging, it's not about me, i am more interested in beautiful landscapes, finding new location gems, culture. Also i am a licensed pilot. I am not looking to be super aggressive, i am not looking for zero tax, but a lower tax with good quality of life would be a consideration for my new place of residence (particulary a place with good weather) Anyways does anyone else have a opinion? How would you structure things? where would you bank? would you bank be in your country of residence or if i am travelling would it be more studious to employ the services of say a bank in Singapore, that perhaps reduces the atm and exchange fees?

 

[RexS9999]

No longer easy to open a Singapore bank account. Using ATM's is costly. You pay a fee each time and the exchange they give is bad. If you settle in a country open a bank account. Cambodia was easy to do this. Then fund the account using Wise or similar companies.

 

[Martin Everson]

The assets you mentioned either rallied already massively (art and land) or hardly keep up with inflation (gold).

Not true. Plenty of egyption artifacts going for big money on market since 100 years. Those 3 have remained solid investments for 100's and even 1000's of years.

 

[Golden Fleece]

Using ATM's is costly. You pay a fee each time and the exchange they give is bad.

He is from Canada, so I assume that he can open a Charles Schwab account. Schwab reimburses ATM fees worldwide and it also does not charge foreign transaction fees. One of the best in the world.

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[RexS9999]

Charles Schwab is not available to Canadians. He could get an HSBC Premier account if he has over $100,000 with HSBC. Then no ATM fees at HSBC ATM's globally. But you will still get a bad exchange rate. ATM fees are only one cost. The exchange rate is another. He would have to convert the CAD to the local currency to spend it.

 

[Golden Fleece]

The assets you mentioned either rallied already massively (art and land) or hardly keep up with inflation (gold).

For land and real estate, it depends entirely on the country. In the developing world, most property is still bought using cash and mortgages are uncommon, so real estate prices are still low -- because central bank policies that create artificially low interest rates with low mortgage rates have not created bubbles.

Even in the developing world, land values have not yet reached the apex of their 17-21 year bubble. Read "The Secret Life of Real Estate and Banking," by Australian economist Philip Anderson.

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Charles Schwab is not available to Canadians. He could get an HSBC Premier account if he has over $100,000 with HSBC. Then no ATM fees at HSBC ATM's globally. But you will still get a bad exchange rate. ATM fees are only one cost. The exchange rate is another. He would have to convert the CAD to the local currency to spend it.

Another option is Capital One, which does not charge foreign transaction fees but does not provide out-of-network fee reimbursements. I believe that Capital One also operates in Canada.

 

[RexS9999]

The real advantage of real estate is the use of leverage. Easy to get cheap mortgage money with the low interest rates. This a problem for retired guys on pensions.

 

[Golden Fleece]

The real advantage of real estate is the use of leverage. Easy to get cheap mortgage money with the low interest rates.

That was true before central bank policies created artificially low interest rates (with low mortgage rates) that created bubbles where investors can lose everything. If you read "The Secret Life of Real Estate and Banking" by Australian economist Philip Anderson, you will see that a land bubble occurs in the U.S. every 18.6 years on average. That danger is now far worse because of those artificially low interest rates.

 

[RexS9999]

That was true before central bank policies created artificially low interest rates (with low mortgage rates) that created bubbles where investors can lose everything. If you read "The Secret Life of Real Estate and Banking" by Australian economist Philip Anderson, you will see that a land bubble occurs in the U.S. every 18.6 years on average. That danger is now far worse because of those artificially low interest rates.

Completely agree. So where to invest?

 

[backpacker]

Not true.

If you think so ....

Plenty of egyption artifacts going for big money on market since 100 years.

Indeed, all stolen.
The Germans are masters in this. They even refuse to return the illegally acquired Nefertiti bust until today.
So, do yourself a favour: Before investing ask Khaled Al-Anani. Even better: Do not invest in it!

Those 3 have remained solid investments for 100's and even 1000's of years.

If we exclude Egyptian artifacts (stolen goods are hardly a benchmark) I partially agree. I mentioned before that gold hardly kept up with inflation. Gold is Believe, if somebody is a Believer then fine it is.
However, real estate is in a bubble and you will see it burst. Investors (me included) tend to have a blind eye for bubbles .... .

Completely agree. So where to invest?

Check Silver, Platinum and crypto. With the former two you invest in the "New Green Deal" + hard asset PM; with the latter in fancy new technology with an unknown outcome.

 

[Martin Everson]

Indeed, all stolen.
The Germans are masters in this. They even refuse to return the illegally acquired Nefertiti bust until today.
So, do yourself a favour: Before investing ask Khaled Al-Anani. Even better: Do not invest in it!

All art sold and traded is stolen? I think your being a bit disingenuous here. There is stolen art out there and a black market for art. However auction houses have for a long while now checked for provenance of art sold through them.

If we exclude Egyptian artifacts (stolen goods are hardly a benchmark) I partially agree.

Again your premise is wrong and a terrible assumption.

I mentioned before that gold hardly kept up with inflation. Gold is Believe, if somebody is a Believer then fine it is.
However, real estate is in a bubble and you will see it burst. Investors (me included) tend to have a blind eye for bubbles ....

You obviously have a very small time horizon through which you look at every blip in a chart to make this call.

Again Land, Gold and Art remain good investments. And if held in trust for your future generations can ensure them wealth for many centuries to come. Other assets classes you will find will be short term flavour of the day or intangibles.

 

[backpacker]

All art sold and traded is stolen? I think your being a bit disingenuous here.

When you check the original post you will learn that I was talking about Egyptian artifacts (you mentioned them) and Germans (I mentioned them).
Nevertheless, we can easily broaden it because unoccupied Egypt has at no point in time officially allowed the export of these kind of (valuable/historical) articrafts.