Stop Paying Taxes (Yes, Legally!) And Pay Down Your Debt

What did Ben Franklin say about taxes? “In this world nothing can be said to be certain, except death and taxes.”

What if only one of those was true? What if taxes were not so “certain”? As we enter tax season, let’s look at and challenge this statement: Are taxes as “certain” as Benjamin Franklin would like to make us think?

What if you could make a decent income and not pay taxes, legally? How much of your high student loan debt could you pay off?

What most Americans do not know is this: There is this little-known tax write-off called Foreign-Earned Income. If you live abroad and make less than $105,000 per year in wages, you do not owe any US income tax.

I know. I know. Move abroad? Come on. Who does that? It’s scary. It’s too radical. You have no other language skills than English. Your degree is in art, or some other unmarketable skill. How would you even get a foreign company to want you enough to hire you and sponsor your work visa?

My first job in Singapore was not very high-paying, only $55,000 per year. In only five years I was able to change jobs, and grow my income to $235,000 (an increment of around 30 percent per year). I spoke only English. And in the end, because I didn’t have to pay U.S. income taxes, I was able to pay off a whopping $147,000 in student loan debt.

And there was an added benefit: when I moved back to the U.S. recently, because I’d gained valuable skills in the finance industry, I was able to land a job paying $200,000 per year. Believe me, when I left the U.S. seven years ago with a film degree and four unpaid internships under my belt, I couldn’t even begin to conceive of making that much money.

In my upcoming book, I explore the subject of not paying taxes by moving abroad in much greater depth, with charts on the best countries to move to with the highest quality of living and the lowest local taxes.

For now let’s talk about where you might begin with finding a job abroad. It’s actually much easier than you think.

  • Pick an English-speaking country with a low tax rate, that has jobs in the industry you work in. Make sure it is a country that seems like a place you could see yourself living for a while, based on weather, culture, etc. Be realistic about the components you need to be happy. If you love skiing, don’t look for jobs on the equator. You are about to embark on an exciting new chapter of your life while paying off a huge amount of debt, and the thought should be both invigorating and a tad scary.
  • While you are still in your home country, apply for jobs abroad. Aim for a minimum number you will apply for before giving up – say, fifty. Ask or pay someone to give your resume a professional go-over, to ensure it is at its best before starting. Go on Linkedin and find other people working in that country, maybe even for the company you’re interested in. Ask for tips on finding jobs there. (Leave out the part about your six-figure student loan debt.). Look online for Expat/Expatriate groups in that country and reach out to the moderator for tips on finding work.
  • If no companies get back to you for interviews, do not despair. But DO save up some money to make a visit. If you can manage to save up enough money for a one-way flight and a month of living expenses, go for a month and commit to spending each day looking for work in that country while living cheaply in an AirBnb or similar. If you are not in a place to leave your current job, save up some vacation time and go for a 9-day trip (leaving on a Friday, coming back two Sunday’s later). Pre-plan the trip so that you have a specific plan of job-finding attack when you are there. Meet with the contacts you made on LinkedIn and the Expat groups. Forget about sightseeing completely; you can do that once you live there.

Still find the idea of getting a job abroad too daunting? What if you chose to go overseas for a restricted amount of time, just a year or two. Even a short time will help you pay down at least some of your student loan debt. If your biggest worry is that you’ll be alone in some foreign place, put such anxiety aside. Expats tend to congregate together in foreign countries. I made many friends and had an incredibly active social life in Singapore. In fact, after weathering the transition, you may find you do not want to leave right away.

No matter where you choose to move, the point is this: You do not have to pay taxes. You can make a great income and have thousands left over to pay down your six-figure debt. This is not fantasy. This is areality. All you need to do is engage your inner debt rebel, and make the leap.