South African retirees who are in a position to do so are increasingly looking at overseas destinations in which to make a home, says Jacques Scherman, Vice President: Business Development at Arton Capital, a global company that specialises in working with people to attain second citizenships.
And their reasons for doing so are manifold. “Some want a passport that enables them to travel the world easily,” says Scherman, “While others want to secure a more predictable future for their children and grandchildren, and some are concerned about preserving their wealth in tax-efficient structures and stable currencies to maximise succession planning and hedge the financial risks inherent to holding assets in Rands.”
Whatever the motivation, says Scherman, the destination options are becoming wider and the financial barriers to attaining second citizenships for retirees are lowering. “Second citizenship by investment is no longer the preserve of the super-rich.”
Scherman uses the Caribbean, Grenada in particular, as an example. “Grenadian citizenship for the main applicant, spouse and two dependents can be purchased via a donation of US$200 000 to Grenada’s National Transformation Fund. While this is non-refundable and, unlike an investment into property, can’t be ‘sold on’ for a return on the investment down the line, there are numerous benefits for those who can afford the price.”
Chief among these benefits is the speedy application process – around three months, compared with years for some other destinations, no physical residency requirements, and visa-free travel to over 100 countries including those in Europe’s Shengen zone. And, there is no requirement for a business interest, making it ideal for retirees.
However, for younger retirees with an entrepreneurial bent, having Grenadian citizenship enables entry into the USA with an E-2 Investor Visa. An E-2 allows individuals to reside and work in the USA provided that there’s an investment under their control. An investment substantial enough to capitalise the start-up of the business is required but, as long as the business remains solvent, residency in the USA is secure.”
Arton has facilitated USA-based business interests for a number of South Africans, including some farmers, via this second citizenship process. When you compare the Grenadian scenario to the requirements for South Africans who want to emigrate directly into the USA, which include costs of around a million US Dollars, up to an eight-year waiting period and substantial amounts of paperwork and administration, the advantages are clear.
“Provided that the due diligence investigation doesn’t find any criminal, tax or health issues and your paperwork and funding are in order, I would say that retiring in Grenada is the fastest and easiest option for those who wish to retire abroad,” says Scherman.
Other popular destination opportunities for South African retirees include Mauritius, the Seychelles, Portugal and Bulgaria – all of which are attainable and attractive for high net-worth individuals.
“The thing to remember,” says Scherman, “Is that, wherever you set your sights on, there are financial regulations, tax imperatives and investment requirements that have to be adhered to. It’s always worthwhile to work with experts who can guide you to make the best decisions and know how to make the process as smooth as possible.”