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The 4 most common types of individuals applying for citizenship by investment programs

Citizenship by Investment Programs (CBIs) are becoming increasingly popular as a way to invest overseas while getting the option to apply for a second citizenship at the same time.

But, nowadays, who are these investors that look to invest in such programs? Are they all just wealthy individuals?

In this article, we discuss the four main types of applicants for CBI programs. We explain why these people apply for citizenship and what makes each one unique.

Photo by Jason Hafso on Unsplash

Citizens With a Global Mindset

Investors who apply for citizenship by investment programs tend to fall into two categories: Those who are motivated by money and those who are motivated by freedom.

Those who are motivated by money usually apply for citizenship by investment because they believe that it will allow them to avoid paying taxes in countries like Australia, Canada, New Zealand, United Kingdom, and the United States.

Freedom seekers, meanwhile, apply for citizenship by investment to gain permanent residency status in a country like Portugal, Malta, and Spain. Once they receive their permanent residency status, they can then apply for citizenship.

While both groups benefit from the programs, each group tends to have different motivations. Business owners typically look for financial benefits while freedom seekers tend to focus on gaining legal residency status.

To learn more about the differences between business owners and freedom seekers, read our article on the topic here. 

Digital Entrepreneur and Nomads

Entrepreneurs are those who seek out new ideas and ways to make money. They often start businesses and create jobs. Entrepreneurship requires risk taking, innovation, and hard work. Citizenship by Investment Programs allow entrepreneurs to obtain citizenship in other areas of the globe and while travelling to other destinations. A second passport often might come handy for these types of investors, specially if they plan on moving abroad permanently.

Digital entrepreneurs are typically young professionals who are interested in starting businesses overseas. They tend to be highly educated and entrepreneurial, and they usually have a strong desire to travel and explore other cultures. These individuals are likely to invest heavily into their business ventures and plan to return home after making money abroad.

Nomadism is a lifestyle choice where an individual travels from place to place with no particular destination or purpose. During and after the pandemic, many nomads choose to travel around the world because it offers them freedom and flexibility while working remotely. They can move anywhere they wish and live wherever they desire. In fact, many nomads choose to settle down in different countries throughout the year, and move from one to another depending on different factors, such as weather, job availability, etc.

For example, some may choose to stay in Europe during summer, but head to Asia during winter. Others may decide to go back home to visit family and friends during holidays.

Retirees

Retirees are typically retired individuals who are looking to escape the hustle and bustle of life back home. They are generally older and have families and responsibilities back home. Retirees are usually motivated by the prospect of having a stable income and being able to relax. Also, it’s quite frequent that these individuals decide to stay living in the country they are investing in, just for a part of the year (normally in winter periods) and get back to family and friends in summer. 

With populations ageing faster in the vast majority of the countries in the world, it might be that retirees will become a larger segment of the global population in the coming years. This means that there will be more demand for retirement visas and citizenship programs.

Common Reasons for Applying to CBI Programs

Each individual has different motivations, and that’s why some types of programs have been targeting different types of investors.

For example, someone who wants to become a citizen of another country might be motivated by financial reasons. They could be looking to save money on taxes, pay less interest rates on loans, or avoid paying capital gains taxes.

On the other hand, someone who wants to invest in real estate might be motivated by lifestyle reasons. They could be interested in living abroad, owning property in a foreign country, or just having a second home.

It’s important to remember that while some people may be motivated by financial reasons, others may be motivated by lifestyle reasons, or political reasons.

Saying that, the most common reasons to apply for these programs, are related to:

  1. seeking financial freedom
  2. looking for tax advantages
  3. diversifying investments overseas
  4. real estate opportunities

 But the major goal for applying to a second passport through investment, is that in return for putting down a lump-sumpay. While doing that, they can obtain a new citizenship within just a few months, as well as enjoy numerous benefits such as visa-free travel, favourable taxation, and the ability to buy property abroad.

Citizenship by investment, is the new way of becoming atypically motivated by two reasons. In some cases they want to protect their assets from potential political instability. Second, they want to take advantage of tax benefits.

The Bottom Line

Individuals who have enough money to invest in real estate, business opportunities, and other investments can now do it globally. These individuals tend to be well educated and have a high net worth, but that’s not something mandatory. They may own multiple homes or businesses around the globe.

CBI Programs are here to stay and might become more and more popular in today’s world, where people are constantly searching for better opportunities.

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