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Apr 09 2013

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Why America is Still The Land of Opportunity





Despite America’s suffocating debt levels and (what many consider) its self-defeating government policies, more foreigners than ever are wishing they were American.

 No, I’m not talking about Cubans launching dilapidated boats bound for Florida.  Nor am I talking about lottery green card wannabes from impoverished nations, desperate for their own piece of the American Dream.

I’m thinking about nationally proud young people who wouldn’t normally admit their envy for the land of Stars and Stripes:  Brits, Canadians, Australians, and Europeans.

So why the sudden affinity?

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About the author

andrew hallam

I'm a freelance finance writer, lucky enough to have been nominated as a finalist for two Canadian National Publishing Awards. I'm also the author of Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School, a book explaining how I became a millionaire on a teacher's salary, while still in my 30s. Working to empower people financially, I'm available to motivate and inspire people on basic retirement planning and index investing. I'm happy to comment on your questions, first, please read the Terms of Use.

Permanent link to this article: http://andrewhallam.com/2013/04/why-america-is-still-the-land-of-opportunity/

7 comments

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  1. avatar
    IIW

    The land of the patriot act and countless other anti-citizen bills? No way, No envy from this Canadian. ;)

    I do agree with the basic premise though and I think that we could benefit from a more reasonable housing market and wider access to lower cost funds.

    1. avatar
      Andrew Hallam

      Let's hope it's coming!

      An Aussie friend of mine also took exception to what I wrote.

      To Australians everywhere: Sell your ridiculously priced homes and buy some cash flow positive real estate revenue generators in the United States. You'll be glad (eventually) if you do!

  2. avatar
    Ryan

    Andrew,

    Just finished reading your book and I am inspired to make some changes. I wish I read it 10 years ago. As an engineer your approach seems more logical than any I have utilized previously. I've been very lazy the last few years with money sitting in cash in my waterhouse accounts. I basically distrust mutual funds from poor performance but don't trust myself speculating in my waterhouse account. I prefer the approach of mechanical investing through index ETF's you discuss. I'm going to try and get on it.

    I'm 33 and my wife (supply teacher) is 27. We have approximately $330,000 in net worth and are fully liquid with no debt. Its not a fortune but its a fair chunk of change in my world. We rent as I think the Canadian housing market is over heated (speculating I guess). I think investing our money and renting makes more sense.

    Anyway, my question is how should we go about re-entering the market using your diversified index investing strategy. Should we go all in now? Dollar cost average over time a specific dollar amount? Try to time the market (speculation :) )?

    Any input is appreciated!

    Ryan

    1. avatar
      Andrew Hallam

      Hi Ryan,

      Based on back-tested studies, jumping "all in" with a lump sum (that you diversify) works best more often than not. However, it can be psychologically difficult for many people to do that, especially when they see the markets fluctuate immediately (which is what markets typically do). Dollar cost averaging could give you more peace of mind, in this regard.

      I would lump it all in, but I don't get spooked by market movements and don't tend to look back with regrets when things fall after I buy. But….you might be wired differently. You could try the best of both worlds. Take half the assets and lump it into a diversified portfolio, while spacing out the other proceeds over the following 12 months by dollar cost averaging.

      I hope this helps.

      Cheers,

      Andrew

  3. avatar
    Jim

    Well said Andrew, that is interesting about Canadian Lending and how you cannot get a 30 year fixed. I never realized that wasn't the norm across all nations. I hope it just doesn't turn out that much of the real estate that gets purchased in the years to come isn't by foreign investors. The increased demand would certainly drive up the cost of purchasing, but I guess it would make the rental market even stronger, which I dig! Great post!

    1. avatar
      Andrew Hallam

      Thanks Jim,

      I don't think you have to worry about too many foreign investors. For the most part, they would have to pay cash (mortgages aren't easy for them to obtain) and they can also be scared of the estate taxes they would have to pay the IRS, posthumously. That said, what's to fear there?

      Certain pockets, however, could be driven up by foreign investors. That's one of the reasons Vancouver, B.C. is so expensive. For some reason, the Chinese are nuts about it.

      U.S. investors were among those that drove prices up in Whistler, so it certainly does happen–but mostly in pockets.

      Cheers,

      Andrew

  4. avatar
    Daniel

    As a Canadian with dual U.S. citizenship. . I wonder if I am crazy not to take advantage of the US housing and investing disparity. We hope to buy our first new home. . (must have apartments to rent out) in the next couple of years. Toronto looks like the best bet jobwise. . but the prices are ridiculous there and we want to avoid Condo's which we see as a bad investment longterm.

    I'm not a fan of the gun and religion culture of USA. . and don't know if my wife who is Chinese can get a suitable visa if I work there. . . but if you guys were in my shoes. . what would you do??

    Don't be jeaolous!. . So far my US citizenship has actually just been a burden since I have file US taxes every year alongside my Canadian income taxes.

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