Tax affairs.

[Al]

We have three pensions and a benefit paid to our wee bank in Kalives directly by the pension providers in Scotland through Citibank and the exchange rate is absolutely fine, better than I can get any other way.

All banks in Greece accept this kind of transfer, though there can be "teething problems" a few months after set up. We have been trouble free now for seven years!!!

For what it's worth we use the Pancretan Bank in Kalives - it's small, but very friendly and usually very efficient.

[Kilkis]

Warwick, I think you mean lost it over the last few years...

They haven't really got going yet, Geroge. Mike Carney, with his forward guidance, has changed completely how the BoE will operate, which will be even more detrimental to savers.

Firstly he is no longer targeting an absolute 2 % value for CPI but has effectively moved it to 2.5 %.

Secondly the 2.5 % he is targeting is not the actual rate but the BoE's prediction of the rate, i.e. the BoE will not raise the base interest rate until the BoE predicts that the inflation rate will go over 2.5 %. Over the last eight years the BoE prediction has been below actual by between 0.5 % and 3.8 %. Since QE started the predictions have become worse and average a little more than 2 % below actual over the last 4 years. If this performance continues he is now effectively targeting a real 4.5 % inflation rate.

Thirdly RPI better represents the actual inflation we feel than CPI and RPI is typically 1 % above CPI so he is now effectively targeting a 5.5 % figure for RPI.

If typical bank interest stays at around 1 % then the spending power of any savings will decrease by 4.5 % per year. This amounts to a 25 % drop in purchasing power in five years.

In "The Economic Consequences of the Peace", 1919, John Maynard Keynes wrote:

"Lenin is said to have declared that the best way to destroy the capitalist system was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth. Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become 'profiteers,' who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery.

Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose."

You only end to go back a few hundred years and the penalty for debasing the currency was to be hung and drawn. Perhaps a return to such times might concentrate banker's minds?

Warwick

PS I have also never used a financial adviser. I prefer to make my own cock-ups and over time I have become very skilled at it.

[filippos]

I always thought you could have your pension paid direct into a Greek bank in Euros direct from U.K pensions. Or has this now changed ???

As I said above, they told me that's the only way it can be paid. My problem is that I don't want Euros paid into my Greek bank account. I want GBP into my GBP account with the Greek bank.

I'll check with the Pensions Service next week to see if they've changed the system so that I can be paid here in GBP. That way there'll be no exchange costs and my UK bank can't charge anything if there's no bank transfer.

[YoMo2]

Filipos/Allan

I think Filipos is right about having to be paid in euros. Sorry, memory lapse there.

DWP pay direct to HSBC in Athens, any branch will do. I transfer by online banking to (variously) Piraeus Bank, Agrotiki, Bank of Cyprus. (All now Piraeus Bank of course.....

The list of banks that shows on the HSBC online banking is long. You should have no worries about transfer to Crete, unless you use a really obscure bank. And I mean really obscure.

Andrew

[moggieman]

Blimey YoMo2


How big a pension do you get ???




DWP pay direct to HSBC in Athens, any branch will do. I transfer by online banking to (variously) Piraeus Bank, Agrotiki, Bank of Cyprus. (All now Piraeus Bank of course.....

[Kilkis]

You don't need a lot of money to recognise the benefit of diversifying, moggieman.

If you ever wake up one morning and find that all your savings are in a bank that has gone bankrupt with queues a mile long, of people trying to get their money out, outside every branch and you cannot get any internet access, you start to realise the benefits of diversity.

If you suddenly discover that the bank where you have savings has been sold to an Icelandic bank, that the savings are locked in and the Icelandic bank subsequently goes bankrupt it tends to reinforce the first message. It also tends to make you hyper conservative to where you put money.

I don't have much money but I currently have 13 accounts with 7 different banks in 4 different geographical locations. Unless the whole world wide banking system collapses simultaneously I have some chance of getting at some savings whatever happens.

For those who opt to use a single bank, which is the simplest method, if that bank goes bankrupt it could take you over six months before you have access to any money at all. Make sure you have a big wad under the mattress. That six months is not theoretical; it is from direct personal experience.

Warwick

PS I don't think the guarantee of €100,000/£85,000 is worth the web site it is written on. I think it is pretty certain that the next time a major bank goes bust there will be a massive bail-in of savings including those within the guarantee limit. Since the "Too big to fail" tag was first coined many of the big banks have got bigger and their derivative positions, which are the highest risk, have got also bigger not smaller.

[Tim]

I don't think the guarantee of €100,000/£85,000 is worth the web site it is written on. I think it is pretty certain that the next time a major bank goes bust there will be a massive bail-in of savings including those within the guarantee limit.

I fear you're absolutely right, Warwick, as this recent post on The Slog suggests:

"But yesterday from the German site Deutsche Wirtschafts Nachrichten (German Economic News) came a piece reporting that all bets are off as far as the ‘guarantee of all funds under €100,000′ pledge is concerned. Under the current Lithuanian Presidency the proposal as drafted – and almost entirely ignored by the Western media – states as follows:

In the event of a banking collapse, all previous government commitments are null and void. The force majeur of “exceptional circumstances” can lead to ways round such pledges."

http://hat4uk.wordpress.com/2013/08/09/global-looting-the-new-eu-bailin-law-was-passed-8-days-ago-did-you-notice/

Happy Days!
Tim

[Kilkis]

Total UK savings approximately £1.3 Trillion.
Total UK public debt approximately £1.3 Trillion at the end of 2013.

Neat and tidy. Confiscate all UK private savings and national debt problem solved. Simples.

Warwick

[Reg]

In terms of capital adequacy the US banks are generally safer bets than UK or European banks, although I believe HSBC already meets Basel III / new leverage ratio etc.

Personally I would not keep more than enough to tide me over in a Greek bank. That is, not even HSBC or US bank in Greece. They are probably Greek legal entities and subject to Greek rules. One day when Greece is more stable it may jump ship and go out of the euro into the drachma. You would be caught just as if you were in a Greek bank.

I also don't think it would be advisable to rely on being in a GBP account in a bank in Greece (whether Greek or foreign bank) as there is nothing to stop the Greek government re-denominating your GBP account into euros and then drachma or straight into drachma. My guess is that this is quite a likely outcome if they do jump ship.

Also, any money in a bank in Greece would be caught by exchange controls and (potentially) withdrawal restrictions - like Cyprus!

As regards the €100k (£85k), I would rather rely on the UK guarantee than the Greek one! The thing about the UK guarantee is that at least the government can print the money to pay out whereas the Greek's cant print euros.

As Kilkis is really saying, play safe.

Reg

[mouche]

According to all the experts here Greece should have gone back to Drachma, or New Drachma, long time ago, what happened? Or didn't happen?

Personally I keep my money in a Norwegian bank in kroner, sell kroner/buy euro when rate of exchange seems to be favorable and put it into my euro-account in Norway/Norwegian bank, and transfer euro to my Greek bank account when needed. Everything done from my laptop wherever I might be at the time.

[Reg]

Ideal mouche. You cant get a harder currency than the kroner. As I recall, the Norwegian wealth fund owns on average 1% of every share on every stock market in the world. How's that for security backing the currency!

Reg

[bobscott]

Personally I would not keep more than enough to tide me over in a Greek bank. That is, not even HSBC or US bank in Greece. They are probably Greek legal entities and subject to Greek rules.

Reg

Money transferred in one day, withdrawn the next! About €40 in our Greek Bank. Can probably afford to lose that if push comes to desperate.

[allan]

At last I managed to get a sensible answer from my Local Govt. pension fund.

HSBC can transfer my pension to their branch in Greece and then on to any bank in Crete.

Single transfer in Euro`s cost 2.50 pounds via world pay. Conversion at Bank rates at the time.

Single transfer in sterling to European and non-European countries cost 3.00 pounds.

My pension would arrive in my bank 7 to 9 days after the due date.

After reading many posters views and worries (and mine as well) maybe better to leave well alone and keep my money in the UK Bank for the time being.

Just hope as Wobblick (sorry Warwick) suggested maybe a Crete Bank will give me a credit card to pay my tax. ( just seen three pigs flying over the house less noise than the Greek Air Force)

[YoMo2]

Blimey YoMo2 How big a pension do you get ???

DWP pay direct to HSBC in Athens, any branch will do. I transfer by online banking to (variously) Piraeus Bank, Agrotiki, Bank of Cyprus. (All now Piraeus Bank of course.....

Doh!! Not all at once..............

[Kilkis]

...I received an email from my accountant on 1 August, with an attached computer produced tax statement, saying that I would receive the official copy in the next 2 to 3 weeks so I presume he had just submitted it. I'll report when I receive it to give people an idea of how long it takes from submission to receiving the bill.

Warwick

I got the demand yesterday, 10 September 2011, so it took almost six weeks from submission to me receiving the bill. That might be a bit slower than normal because it was August and Greece is usually closed in August.

I have the option of paying it all before 30 September 2013 or half before 30 September and the other half before 29 November.

Warwick