The Rich Are Moving Assets Abroad. What’s Prompting the Shift.
Some wealthy Americans are motivated by the changing political landscape under President Donald Trump, or they want to protect their assets if the U.S. economy weakens.
Many wealthy individuals are pleased with President Donald Trump’s policies—and relieved they won’t face the “billionaire’s” tax once proposed by the Biden administration. But others are worried, and they aren’t waiting to see how Trump’s second term will affect the economy, markets, and their personal lives.
Many wealthy individuals are pleased with President Donald Trump’s policies—and relieved they won’t face the “billionaire’s” tax once proposed by the Biden administration. But others are worried, and they aren’t waiting to see how Trump’s second term will affect the economy, markets, and their personal lives.
In addition to moving assets and investments abroad, these folks are also, in some cases, seeking residency or citizenship in other countries, according to immigration attorneys and wealth managers.
The wealthy have a number of reasons for moving funds to Switzerland, Singapore, or the United Arab Emirates, among other locales. Here’s one: protection against actions by the Trump administration for perceived wrongdoing.
Those who didn’t receive preemptive pardons from Biden, and who worry about being targeted, fear the new administration could freeze their bank and brokerage accounts, according to immigration attorney David Lesperance.
“Having money means that they have more tools in the toolbox,” Lesperance told Barron’s. “It also means they’re at a greater risk of being a target and they’ve got more pain points.”
He prepared a document outlining actions clients should take if they are concerned about retribution. Step one: Secure a second passport, as the U.S. one can be canceled by the government without notice. Step two: Open and fund non-U.S. bank and brokerage accounts “ASAP.”
One of Lesperance’s clients, who was among those involved in “high-profile efforts to bring Trump to justice,” wants to move himself and his family out of the U.S., given the propensity of Trump and his supporters to seek revenge on perceived enemies, he says.
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“Unjustified civil and criminal government harassment would be financially and emotionally devastating,” Lesperance says. “This is a major topic of discussion with his [client’s] colleagues, both currently in and out of government.”
Interest in moving assets abroad always increases when different parties take the U.S. presidency, says Philipp Hensler, an independent wealth advisor in Switzerland. “Doesn’t matter if Biden or Trump is president,” he says. “Uncertainty increases, and wealthy people are trying to hedge their bets.”
Some who are now inquiring about moving assets or getting a second citizenship want to “prepare for the unexpected,” Hensler tells Barron’s. These individuals are worried about the radicalization of the political and social discourse in the U.S. and believe the country is “entering a prolonged period of uncertainty and volatility,” he says. “There is this general unease that something isn’t quite right.”
The number of individuals who expatriate from the U.S. each year often rises around presidential elections, according Scott Bowman, a partner at McDermott Will & Emery in Washington, D.C., who counsels wealthy individuals, families, and family offices on tax and estate planning. But “the level of intensity of concern in the lead-up to the 2024 election was greater than what I have seen in previous election years,” he says.
Most of the clients who are now retaining immigration firm Henley & Partners are “Democrat-aligned,” Dominic Volek, global head of private clients, tells Barron’s. But there also were those who approached Henley before the election fearful of the implications to their wealth from a win by Democrat Kamala Harris. Some of those individuals are still pursuing a second citizenship as insurance, should Democrats take power in four years, he says.
Michael Pellman Rowland, a partner with Baseline Wealth Management, a Swiss boutique wealth manager that works with U.S. citizens opening accounts abroad, tells Barron’s that some of the inquiries are from those who worry that the U.S. government could impose capital controls on their assets, limiting their ability to move money abroad in the future.
Among Rowland’s clients are a Chicago-based Democratic donor and his wife. They are moving assets to Switzerland so they have “adequate capital outside the U.S., should it ever become difficult to do so in the future,” he says. The couple also plans to live in Europe part time, or even full time ultimately.
Another is a California resident who is a member of a notable art family. She worries about political turmoil in the U.S. and the rising U.S. government deficit. She worked with Rowland to move some of her trust assets to Switzerland.
Many have nonpolitical concerns. Some want to “hedge or at least ‘prep’ for a potential economic ‘doomsday scenario’ ” resulting from inflation, high levels of government spending, and public debt, says Bowman at McDermott Will & Emery.
Bowman’s clients—most with a net worth of about $100 million or more—also are worried about the “ongoing efficacy of the U.S. dollar as the world’s dominant currency,” as the U.S.’s relative share of global GDP declines, according to a draft of a paper Bowman wrote on diversifying jurisdictions.
The wealthy don’t view these factors as “a five-alarm fire,” but because they are stewards for future generations of wealth that they created or inherited, they are asking, “Do we need to have some strategies to diversify out the legal, economic, and political risk if we’re highly concentrated in one jurisdiction?” he says.
Todd Cowan, executive director at London & Capital, a U.K.-based wealth management firm, says the primary reasons his clients choose to move assets or relocate has shifted over the years from a desire to geographically spread their holdings to worries that the U.S. Supreme Court’s 2022 decision to overturn Roe vs. Wade could eventually impact same-sex marriage. People have also cited rising healthcare costs and gun violence in the U.S., in addition to politics.
“While concerns about the changing political landscape or potential policy changes (from Trump to Biden, and now back to Trump), have been part of the conversation and in some instances a leading motivator” for some clients, Cowan said in an email, they are usually part of personal and financial considerations rather than the primary driver.
There isn’t comprehensive data on capital flows to other countries from individuals. But Foreign Bank and Financial Accounts tracked by the government have risen nearly every year since fiscal year 2020 (beginning Oct. 1), including a nearly 8.8% jump to more than 1.7 million accounts in 2024 from under 1.6 million a year earlier, according to a spokesperson for the Financial Crimes Enforcement Network unit of the U.S. Treasury Department.
In the past, U.S. citizens may have moved assets abroad in an effort to avoid paying taxes, but the U.S. government clamped down on foreign financial institutions beginning in 2008 for their alleged assistance in allowing citizens to avoid paying taxes, Bowman wrote.
Today, U.S. citizens seeking to move money abroad aren’t motivated by tax avoidance, agrees Reaz Jafri, a New York immigration attorney at Withersworldwide. “They realize that as American citizens they are going to have their worldwide income reported and taxed in the U.S. and any foreign bank accounts they have will be reported to the IRS,” Jafri told Barron’s.
Securing residency or citizenship abroad is often part of the package for individuals who want to diversify their assets overseas—which often involves buying a home. An initial spike of inquiries in the wake of the 2024 presidential election into law firms and specialists that facilitate migration to other countries have since, in many cases, turned into applications for residency or citizenship abroad for those who qualified.
The number of clients who have retained Lesperance to apply for residency, citizenship, or a digital nomad visa is up more than 400% from his usual pace of business, he says. A digital nomad visa allows someone to live and work abroad for a year or more, depending on the country, buying time until a long-term solution is completed. It’s a “tsunami,” now compared with the “bit of an uptick,” after Biden’s proposed fiscal 2024 budget included a “billionaire minimum tax” of 25% on those worth $100 million or more, he says.
Beginning in the third quarter last year, Latitude, a firm that specializes in residence and citizenship by investment, received an increase in inquiries “from financially qualified individuals with greater intent and faster readiness to proceed,” says Christopher Willis, a managing partner at Latitude. About 16% of inquiries by those who are financially qualified become clients.
At Henley & Partners, applications by U.S. citizens jumped nearly 60% last year from a year earlier. In December, the number of clients retained from the U.S. “absolutely shot the lights out” in a month that is usually quiet, says Volek.
Not all inquiries have turned into applications. At Arton Capital, a firm specializing in residency and citizenship by investment, 5% have initiated the process, with another 15% continuing to explore their options. CEO Armand Arton told Barron’s that he expects a fifth of those will proceed, with others dropping out for a range of reasons, including not being able to qualify or because they no longer feel compelled to move.
Those who are considering a move outside the U.S. for political reasons may be jumping from the frying pan into the fire, as the atmosphere from France to Italy and Germany becomes more nationalistic. But people with enough wealth view a second citizenship as a hedge, not a foolproof solution, Volek says. “If you have the financial capacity, you should be as diversified in terms of your domicile options as possible, because nowhere is perfect.”