The Perpetual Traveler & Flag Theory Create a Global Citizen

Remote work & the tech-enabled exit are creating a passport shopping global subset of Sovereign Individuals called Perpetual Travelers.
Photo by CardMapr on Unsplash

2021 is the year that remote work and the technology-enabled exit create the Sovereign Individual class. These people will leverage location-independent jobs to gain personal sovereignty by extracting value from regional governments like never before. And as these location-independent workers reorganize their lives around the freedom to live anywhere, they’ll form subsets of Sovereign Individuals. Groups of Sovereign Individuals with common interests and needs. And one subset is the Perpetual Traveler.

These Sovereign Individuals are the remote workers that fully embrace a remote lifestyle. Like a Digital Nomad, Perpetual Travelers opt to live on the go. But unlike Digital Nomads, they seek to establish more permanent beachheads around the world to enhance their personal sovereignty. Shopping for and leveraging unique properties of global governments to maximize their quality of life. Less wandering like a nomad and more of a perpetual way of life.

Global jurisdiction shopping or “Flag Theory” has traditionally only been available to the wealthy. Flag Theory was a concept used to secure residency to take advantage of unique laws around the world. Why live in one country when you can have many global homes and rotate among them for different reasons? With flag theory, the aim is to acquire a portfolio of passports, permanent residencies in tax havens, and exotic places to call home.

Remote work and technology-enabled exits are becoming mainstream and now it’s not only the rich that benefit from flag theory. And with digital technology, it’s never been easier for the average person to benefit from a global lifestyle. AirBnB, OpenDoor, global and decentralized finance, translation apps, and access to vast information on rules and regulations. The Perpetual Traveler is an emerging subclass of Sovereign Individual that will become a growing influence in the coming decade.

How Flag Theory Supports the Perpetual Traveler

It used to be only the rich that could build elaborate global lifestyles. They were the only people that had the means to gain personal sovereignty by cherry picking favorable laws from around the world. A primary home in one country, a bank account and business in a tax haven, and a third country with no VAT tax functioned as a playground and cost of living arbitrage. The wealthy of the past few decades were the primary beneficiaries of globalization, using the globe as their playground, moving from country to country on a whim.

But the benefits of digital technology have begun to permeate through society and now a growing class of remote workers can enjoy the benefits of perpetual travel. This growing group of people will approach their lifestyles by trying to maximize the benefits available from living in multiple jurisdictions while staying out of legal hot water. They use what’s called Flag Theory.

The original Flag Theory was laid out by Harry D Shultz in his 1960’s novel, How to Keep Your Money and Your Freedom. It had three flags, or core principles. Everyone should:

  • Have at least one additional passport
  • Get a place to live in a tax haven separate from your primary residence
  • Store assets in a country separate from where this primary home

The theory later added two more “flags”. Find a country with low corporate tax to domicile your business and a country for leisure with low consumption tax.

Flag Theory was designed to establish permanent beachheads in multiple countries that hedge against geopolitical risk and exploit the differences in rules. As we enter the digital age the ability to practice flag theory is becoming easier. But it also requires some careful adaptation as countries are closing loopholes and the needs of perpetual travelers are changing.

Themes That Drive Modern Perpetual Travel and Reinforce a Digital Flag Theory

1.The global pandemic led to the increase in remote work at a scale. This change reinforced the development of supporting technologies for globally, remote business. Cloud infrastructure, video conferencing, long term stay accommodations, “gig” work job portals, and decentralized finance. Expect more tech in the next decade to support the Perpetual Traveler.

2. Nationalism is on the rise globally. Perpetual Travelers will seek out nations that are interested in global integration. The nations that implement protectionist policies will see an exodus of their Sovereign Individuals.

3. The mobile internet makes it easier than ever to gather useful information and shop for new living locations. Selecting multiple locations and choosing a perpetual traveler lifestyle requires a few hours of google search, an AirBnB reservation, and travel documents. Information is no longer a barrier.

4. In the digital age, privacy and freedom of speech are critical elements to consider. Operating a digital business in legal gray areas requires that you domicile your servers in countries with strong privacy and freedom of speech protections. Expect new types of digital flags to emerge.

5. Looking ahead in a world with Covid-19, you may want residency in “green zone” countries. Places that effectively managed the pandemic and have strict regulations on who may enter. For example, do you prefer a country that requires biological passports and proof of immunity over ones that do not? Regardless of what your preferences are on these topics, they will become an important element of flag theory in the coming decade.

6. Education is going digital. Although the pandemic showed traditional education is ineffective when digital, that will change. There will be effective digital education programs developed this decade that support quality education. And as these programs scale, more families will feel empowered to consider the perpetual traveler lifestyle.

The Prototype for Global Citizenry

The Perpetual Traveler lifestyle will not be for everyone. Constant travel and navigating the evolving landscape of legal loopholes will only appeal to a subset of Sovereign Individuals. But it’s clear that there will be large numbers of people that aim to take advantage of Flag Theory over the next decade. As this knowledge worker diaspora grows in size, they will gain influence in their collective size. Becoming the first group of truly global citizens.

And as the number of Perpetual Travelers reaches a critical mass, countries may find that nationalist policies become ineffective. The nations that adopt favorable policies to this emergent Sovereign Individual class will be well positioned to benefit from an influx of knowledge workers. Ultimately, this could pave the way for a resurgence of globalization. And potentially, it could pave the way for stronger and more globally oriented institutions.

I’m building a digital age worldview. Every Monday, I write and curate a publication called The Sovereign Individual. A weekly newsletter that includes news roundups and analysis to help digital age workers adapt and thrive in our changing society. Topics intersect at geopolitics, fintech, crypto, individual responsibility, and personal freedom. Don’t get left behind, subscribe below.


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