How to leave the US

Is this you?

“I want to leave the country. I know I can’t just move to a new country. But I don’t qualify for any visas, and I can’t get citizenship by descent. What can I do?”

Here are several things you can do. Some tips apply only to people who are starting in the US, but the overall approach applies to most people.

First, some assumptions:

• You’re not close to retirement. (If you’re retired, see How to leave the US with only Social Security as income.)
• You might want to travel for a while, but at some point you expect to settle in one country, getting a residence visa.
• You have some countries in mind and have visited them, ideally for long visits.
• You don’t have a condition that requires frequent, specialized medical care.
• Your federal criminal records check will be clean.

Contents

Best way: Build a pile of money and “retire” early
Second best: Create an online income
Least appealing: Get a job

Best way:
Build a pile of money and “retire” early

While you’re in the US, cut your expenses to the bone, make as much money as possible, and let the money pile up until you have enough to “retire” in your target country. You might need less than you think, and your age is often irrelevant.

Your goal is a retirement or passive income visa. It might also be called:

• Non-lucrative
• Financially independent person
• Pensioner, pensionado
• Rentista (this means “person with a passive income,” not “renter”)

With this approach, you avoid a major pitfall: salaries in most other countries are lower, often far lower, than in the US. If you make your money in the US and then leave, you won’t be stuck grinding away for years.

This kind of visa is also good because the time you spend on it counts toward permanent residency, which means freedom from visa renewals. Easier visas for tourists, students, or digital nomads usually don’t count toward residency.

1. Find out what the visa requires

To qualify, you usually have to show one or both of the following:

• A steady income, such as from a pension or investments, which you receive without working
• A pile of money, maybe in a bank account, maybe as investments, it depends

You might need to show just one or the other. For example, some visas just want to see that you have a pile of money. Others want to see your pension or investment income and a smaller pile of money. Others prefer to see passive income but will accept you if you “just” have a pile of money.

Like every visa, retirement visas have additional requirements, such as health insurance, a clean criminal record, etc. We’re focusing on the financial requirement, because that’s usually the toughest.

Example: Spain’s non-lucrative visa

Recently, to get the Spanish non-lucrative visa as an individual, you supposedly needed to show either:

• An annual passive income of €28,800 or
• A bank account with a balance of at least €60,000

I say “supposedly” because different Spanish consulates have different requirements. It’s all part of the fun.

Other examples

To get an idea of the levels of income involved, see the income requirements of many retirement visas (might not be current).

2. Choose which requirement to meet

Let’s say your target country wants to see either:

• An annual passive income of $30,000 or
• A standard bank account with $60,000, proven with three months of statements

The country won’t allow you to work. Which requirement should you try to meet? The income, or the bank account?

The bank account sounds easiest: “Once I’ve saved $60k, I can move there!” However, that $60k has to be in the account again a year later, when you renew the visa. You can’t spend it, and you can’t work. What will you live on?

If you don’t have any passive income, or it’s not enough, you’ll need investments. But how much?

3. Calculate the investment needed

First, research the cost of living in the country with sites like Numbeo and forums for foreigners who live there. The amount you spend as a tourist is probably higher than the cost of regular life.

Then ask, is the income required for the visa higher or lower than the actual cost of living?

• Higher: You won’t really need the income that the visa requires. So consider meeting the savings requirement only, and invest enough additional money to give you the lower income that’s actually necessary. For our example visa:
  • You realistically need only $20,000/year to live there. So you amass $500,000 invested at 4% to give you about $20k in passive income.
  • Three months before applying for or renewing the visa, you move $60k of that investment into a bank account to meet the savings requirement. Once the visa is approved, you move the $60k back into your income-generating pile. You’re not playing a trick. You have far more than the required savings. You just don’t leave it in accounts that don’t pay interest. If it’s questioned, you can show transactions proving that this is your money and it wasn’t, say, borrowed from your parents, which actually is a dumb trick.
• Lower: You’ll need more income than the visa requires. Either choose another country, or invest a bigger pile of money. Example:
  • You actually need $40,000 a year to live there. So you amass $1,000,000 invested at 4%. (Yes, it’s possible, especially if you sell a house or business.)
  • For our fictional visa, you just show your income. You don’t create a $60k bank account, because your income meets the requirements.

How to calculate the size of your investment

How much money do you need to invest to get a specific income? Here’s one formula:

Target annual income / current yield = pile of money needed

Example: Low-cost country
If the visa requires $500/month in income, that’s $6,000 per year.

Many people assume a 4% yield for a conventional mix of stocks and bonds. So we’ll use that number.

The formula:

6000 / .04 = 150000

You’d need $150,000 invested in things that reliably pay you 4% to get the income required for the visa. You’ll probably want more, because $500/month is low even in “developing” countries that I’m familiar with.

Example: Medium-cost country
The visa requires $2000 in monthly income, which is $24,000 per year.

24000 / .04 = 600000

You’d need $600k paying 4% to get the required income.

A bajillion caveats

• Make sure you amass enough money to cover not just the cost of living, but also inflation, potential increases in visa requirements, and an emergency fund. Also set aside “run back home” money if you think you might want it.
• Use simulations like this one to make sure you won’t run out of money.
• If you’re 100% confident that you’ll eventually receive Social Security or another pension, you could build a smaller investment and spend it unsustainably until Social Security rescues you. (Does that sound smart? Not to me.)
• 4% is the rate used by a lot of people, but if you’re conservative, you might want to use a lower number, like 3.7%.

“Couldn’t I work, at least a bit?”

Retirement visas usually expect you to be, well, retired. However, they might be generous in their definition of “retired.”

For example, years ago, Spain’s non-lucrative visa was known for quietly allowing work, as long as the income came from outside Spain. I don’t know if that’s the case now.

So there’s a chance that your visa allows some type of work, but you should find out for sure. Don’t depend on third-hand stories.

However, I recommend that you take advantage of your remaining time in the US to make a ton of money and invest it, and plan to live off the investments. You can add work later if you want to and the place that you’re living is fine with it.

4. Make way more than you spend

Now that you have your target number and you’re still in the US, start making as much money as possible. If your current job pays well, keep it, even if you don’t love it. It has now become a short-term tool for freedom, which can make it easier to tolerate.

You’re doing this because the US is one of the best places in the world to make money. This could be your last chance to take advantage of it.

At the same time, slash your expenses. Housing is probably your worst expense, so start there. Sell your house and move in with family, or move into one part of your house and rent out the other, or live in your van, seriously. I lived in a $3,000 trailer. The less you spend on housing, the faster your freedom fund grows.

Check out the Financial Independence, Retire Early movement for tons of tips on how to pile up money quickly.

Get supportive friends. Your intense focus on making money and not spending it will make you weird. Find other people who are also trying to become financially independent. Also, consider not telling most people that you’re planning to leave. They’ll try to talk you out of it.

Consider moving to a tax-free state. If you live in California, New York, South Carolina, New Mexico, or Virginia, you might want to establish residency in a tax-free state now. Learn more about these “sticky states.”

5. Reach your goal and leave

Once you’ve got the pile of money you need and the paperwork to prove it, apply for your visa, get approved, and leave. Or go run around the world for awhile spending dividends without hurting your principal until you’re ready to settle, confident that you’ll meet the visa requirements.

Why is this the best way?

• You’ll never have to work again.
• When you’re still in the US, you’re in the perfect place to make money. It’s a lot harder in most other countries. Use your lucky location to build your financial freedom more quickly.
• When you slash your expenses in the US, you learn that you don’t actually need the stuff you were buying. This is great preparation for living in a new country, where you can’t always get what you think you want.
• As the money piles up, your income increasingly depends on you, on your ability to make good decisions and control your spending. You become less vulnerable to inept employers or disappearing clients.
• When you’ve “retired,” your taxes will probably be lower than if you had a business or job. Income from dividends is often taxed at lower rates than earned income.
• Retirement visas often require less paperwork, which means fewer headaches and lower expenses for lawyers, notaries, translators…

A big drawback

This method takes time. You’re itching to leave, but you have to stay for possibly several more years to build the pile of money. If you’re not good with delayed gratification, you might like the next approach.

Second best:
Create an online income

1. Create a location-independent business

Create a business that you can run from anywhere. Not a job, but a business, incorporated by you, with multiple customers.

You could sell online services or products that don’t require your physical intervention.

Once you’ve proven that the business works, you can use it to get a residence visa. In the meantime, it can support you while you bounce around the world.

Turn your employer into your first client

For a quick start, ask your current employer if you can switch to being a 1099 contractor and work part time and remotely. Some advantages:

• You get a client that you already know well
• You can leave sooner
• You have time to get more clients, which you’ll have to do to avoid being seen as an employee

This makes you responsible for slightly more taxes and paperwork. But if you get multiple clients, you’ll become self-employed in the eyes of visa authorities and could qualify for a self-employment visa. (Make sure you didn’t sign a non-compete agreement that could limit your other clients.)

Why not just work remotely for your current employer?

• Most US employers won’t allow W-2 staff to work from other countries, because the US company would then have to pay the other country’s version of Social Security and face other red tape and legal risks.
• Visas for people who have one remote employer are less common and often temporary. For example, you might qualify for a “digital nomad” visa, but it might last only one year and won’t count toward permanent residency.
• You’ll be less appealing to visa people because you’re vulnerable: All your income comes from one source, and that source can fire you at any time. For example, Americans who have tried to get a digital nomad visa in Spain have reported that Spain wants their employer to sign a document promising not to fire them. The employer won’t sign because their state has an “at will” law.

Get multiple clients. Your income will be more secure, and you’ll look better to visa authorities.

Teach English online?

Don’t have an employer or service to sell? Maybe you could teach English online through one of the many platforms. I’ve heard of people who did that and who qualified for self-employment visas as a result.

2. Run it long enough to prove that it can support you

While you work on the business to establish a track record, you could live in the US (preferably slashing your expenses) or go run around the world, using tourist visas. The run-around-the-world option often turns out to be cheaper, especially if you sell or rent out your US house and you focus on lower-cost countries in southeast Asia, Latin America, and eastern Europe.

Keep local laws in mind. While you’re running your business as a nomad, you might find yourself working in a vacation apartment on a tourist visa. You’re probably working illegally. The local government might not seem to care. Regardless, don’t brag about what you’re doing, don’t hog cafe tables with your laptop, and don’t abuse your visa with border runs. Help the local economy during your stay and then leave before you wear out your welcome.

Once you have a track record of solid income (for example, two years might be required), you could use the business to get a self-employment or entrepreneur visa.

Variation: Combine a business with the “pile of money” approach

You don’t want to work forever. Use your online income to build the pile of money that will one day free you.

Use geographic arbitrage: As soon as you’re making enough to support yourself, you could leave the US and bounce around on tourist visas. You could base yourself in low-cost regions while earning US fees, building your pile of money faster.

Example: Allie and Rob had $300k saved when they left the US to travel full time. They were confident because they also had a $4k/month income from a photography business. Once they were traveling, they realized they could live more cheaply than they had expected, so they stopped the photography business.

Now their YouTube channels earn more than their business did. They still live cheaply and keep building their pile of money. If they decide that YouTube is too much work, they could stop running the channels and probably live comfortably off their investments in the country of their choice.

Build it to sell it

Build a business that you can sell, so you can “retire” sooner.

The process might look like this:

1. Start by selling a service that can be delivered remotely. It’s cheap to start a service business, and you’ll learn what problems your customers face.
2. Create products related to that service. For example, make an online tool that solves a common problem for your customers.
3. Shift from selling your services to selling the products in a way that doesn’t require your personal intervention.
4. Run that product business for a couple of years to prove that it works.
5. Sell the business and add the proceeds to your pile of money. Congratulations, you’re “retired!”

Make it professional

To get visas or sell your business, you’ll need to show professional statements proving its income and legitimacy. Make that easier with these tips.

Incorporate from the start. In the US, where this is quick and easy, set up a legal framework for the business, such as a one-person LLC. Consider doing this in a tax-free state to reduce unpleasantness. Even if you plan to “just” be a freelancer with a handful of clients, having the legal structure will make you more legitimate to visa authorities, and it’s required by business banks like Mercury.

• If you become a one-person LLC, your US taxes will get only slightly more complicated. The IRS will still see you as an individual. It’s not like becoming an S corporation but gives you legitimacy.

Get a business account at a modern bank that doesn’t use SMS codes. Even if you’re “just” a freelancer, get a separate business account. Use an online bank that’s happy to work with people who might live abroad and that uses grownup authentication tools like Authy instead of US mobile phone codes. I was happy with Mercury bank. Some people get a USD business account at more basic providers like Wise. If your US clients insist on paying by check, make sure there’s a way to deposit those checks remotely at your business bank.

Get a US address that scans mail. Look for a mail service that will scan paper mail and forward it to you if necessary. If you used a registered agent to form your LLC, they might offer this service. Consider using a service in a tax-free state.

Get a modern merchant account. If you want to accept credit cards, you need a merchant account. You could get a conventional one, like I did, and suffer for years as their dismal site tortures you. Or you could get Stripe or a similar company that prioritizes online access.

Keep good accounts or hire an accountant. You’ll need to generate profit & loss reports and do other accountant-y things. Learn to do it yourself with good accounting software (I like Xero) or hire an accountant who will work online.

Once you leave, stay out

If you’re an American citizen, you have to pay US taxes no matter where you are in the world. The tax on earned income, however, is reduced or eliminated if you spend at least 330 days outside the US during any 12-month period. Learn more about the foreign earned income exclusion.

Drawbacks

This approach is less risky than the pure “pile of money” approach, because you can live abroad while making money and see for yourself how much you’ll really need. But there are big drawbacks.

• You’ve doubled your bureaucracy, because now you’re both an individual and a business. For a business visa, you might have to submit not only your personal financial reports and criminal records check, but also things like apostilled and translated incorporation filings, bank statements from your business account, a notarized lease for your business office even though you don’t need an office… You have multiple bank accounts, you have to use accounting software, and you need to chase down overdue invoices. You probably also have at least one business-related website that needs regular feeding and possibly a social media profile that you hate but have to use. If you had just made a pile of money in the US, you could have avoided all this.
• It’s work. Even if you get your business to the “passive” state of selling online products, you have to stay on top of emails, technical glitches, multiple bank accounts, quarterly taxes, and surprise updates that break the services you rely on.

Least appealing: Get a job

Don’t do this:

• Get a remote job with a US employer who thinks you live in the US. Sneak off to other countries and use a VPN and other technical tricks to make your employer think you’re still in the US.

You’re lying to your employer and exposing them to legal risks, because now they have an employee in another country but aren’t paying into that country’s social system. You should at least become a 1099 contractor responsible for your own social payments and taxes and be honest with your employer.

Other jobs:

• Get a local job with an international company and be a good worker so you can eventually ask to be transferred abroad. Cons: Lots of fawning is required, your choice of countries will be limited, and if you lose the job, you might lose the visa.
• Apply for jobs in your target country. Focus on the ones that immigration authorities prioritize (jobs on the “critical skills list”) and for which you have the required degree and language skills. Cons: If you get a job, your visa might depend on you keeping it, whether you like it or not. And brace yourself for lower pay.
• Teach English at a school: Get a certificate in teaching English as a second language, and then get a job at one of the many English schools around the world. Cons: I’ve heard complaints about low pay and bad schedules. If you quit without lining up another job, you could lose your visa.
• Leverage a student visa: Get a student visa for a degree that makes you employable in the country. Network while you’re studying, and maybe you’ll get a local job when you graduate. Some universities use English but you’ll probably need to learn the local language. You’ll also need to prove that you have enough money to support yourself while studying.

These approaches make you dependent on an employer. One bad boss could mean you end up leaving the country. If you do manage to get a job abroad, network while you’re there so you can quickly hop into another job if your current one doesn’t work out.

It’s too hard!

We’ve been focusing on approaches that make you responsible for your future. That’s why I keep blathering on about the pile of money and residence visas.

Don’t be this person: They find a way to make a bit of cash online or get an employer who actually allows them to work abroad, and they go run around the world using tourist visas. They don’t care about savings or setting themselves up for a real visa.

When they get lonely or run out of money, they go back to their home country and feel like a foreigner, because their friends and family have stayed the same while they changed. Then they complain about how life is so much better elsewhere and how they should have stayed in country X — it was so much better there.

Build something that will last.

Photo at top: Chiang Mai, Thailand