What is an expat?

An expat, or expatriate, is a person who is temporarily or permanently residing in a country and culture other than that of the person’s upbringing.

The origin of the word is from two Latin terms:
ex – meaning “out of”
patria – meaning “country” or “fatherland”

So, the combination of the two words would mean out of country, or out of the fatherland. Makes sense, right?

Negative Connotation of the term “expat”

Some people feel that the term “expat” is a negative term. I have known expats who don’t like to be called expats. They feel that the words mean “ex-patriot” or that they are no longer patriotic toward their home country.

As I pointed out earlier in this book, that is not necessarily true. The true meaning of the term is simply a person who no longer lives in his homeland, or is living in a different culture. There is nothing negative at all about that. So, really, there is no reason to associate negativity with the term expat.

The term expat has nothing to do with your patriotism in any way, so no need to associate it that way.

Background on Expats

Expats run the gamut of who people are. There was a time when being an expat often meant that you were some kind of business executive that was sent to another country to help your company grow their foreign operations. These days, though, an expat is probably more likely to be a retired person who has moved to a different country because life is less expensive and also because he/she can enjoy better weather and possibly better living conditions, especially for lower cost living.

Who Expatriates?

In the past, Europeans have been the most likely to become expats, particularly the British. The tide is beginning to change, though, and more and more Americans are becoming expats in recent years.

Currently, it is estimated that there are around 6 Million Americans living outside the United States.

Another trend that is becoming more popular among American expats is the renunciation of their US Citizenship. The reasons for this are multi-fold.

  • Taxes. As the tax bite gets larger in the USA, a number of celebrities and rich people have renounced their US Citizenship.
  • Taxes, other. Because the USA is the only industrialized country that double taxes it’s expat citizens, this has led to citizenship renunciation as well. Even if the host country taxes an expat, the USA does too.
  • Banking. The USA requires strict bank account reporting if the Expat has foreign bank accounts that hold over $50,000 in total. Additionally, the US enforces reporting requirements on foreign banks that have accounts for US citizens. This has made it difficult for US citizens to get bank accounts in the country where they live in many cases.

So, because of these factors, Americans are expatriating at a much higher rate than they did in the past.

How many expats are there?

Worldwide, it is estimated that around 6 million Americans are living outside the USA. The number of Europeans is probably higher, maybe 10 to 12 million. Perhaps the total number of expats in the world wold be in the 30 to 40 million range.

Trends in Expatriation

During the second half of the 20th Century, most people who became expats were professionals. These people were mostly sent to foreign countries to work at their employers’ foreign subsidiaries. In the 21st Century, this trend has slowed down a lot, as foreign companies seek to use local talent in their facilities now. This is both done as a cost saving measure, and at the urging of foreign governments.

These days, the trend is for retired citizens of developed nations to move to warmer climates and less expensive destinations, and become expats. This offers a variety of pluses for the retired.

  • Cheaper living costs for those on a fixed income.
  • Better weather that also has health benefits, especially for sicknesses like arthritis that afflict the elderly and have less of an impact in warm weather climates.
  • Inexpensive health care for the elderly.

All of this adds up to make the relocation of retirees a major driver in the expatriation movement in the 21st Century.

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