Have you considered why the Foreign Account Tax Compliance Act was passed into law? These trends are too strong to be affected by political upheaval, protests, hyper-inflation⦠even all-out war. The EU has confiscated retirement and savings accounts to pay for their overspending and government savings accounts could one day become such a target. The central bank of the strongest economy in the European Union has explicitly stated that you are responsible for your country’s fiscal obligations—and would be even if you voted against them! This way, they could save the $80 billion the government spends each year on 401(k) tax incentives. Fortunately, you don’t have to be a target. If you ask me, it’s about control. Editorâs Note: Thought I would pass along this second article by analyst Frank Koster. If you don’t internationalize, you must accept the risk that your assets will be confiscated, taxed, regulated, and/or inflated away. Since the law will raise negligible revenue, I think something else must be going on here. Ireland I'm sorry, but in order to complete what you're trying to do, you must be logged in. The bank OWES you the money back, but it is under no obligation to actually give it back to you. In 2010, the country’s government told its citizens to either remit their individual retirement savings to the state…. You can pay in as many times as you like, but the most you can ⦠Of course, all that sounds easier said than done, but my team and I have developed a proprietary three-step investment plan that checks all those boxes. The context here is that of Germans not wanting to have to pay for the mistakes of Italians, Greeks, Cypriots, or whatnot. (If you missed his first article, read it HERE.) Finally, I suggest you lock up your wealth in an untouchable location that proceeds to grow and yield extraordinary gains 24/7. I don’t really need funds outside my country anyway!”. Keep in mind: Who will you complain to? . The topic got a lot of attention, and more than one reader asked why the government could propose to cap citizensâ retirement savings, but citizens had no power to cap government spending. The policies put in place so far, such as budgetary austerity, are little match for the size of the problem, and may make things worse. If you live in Europe, the writing is on the wall. Before it can take money from your bank account, the government authority owed money would first need to issue a garnishee notice. Note that the criterion is not billionaire status, nor millionaire, nor even “comfortably well off.” The tax would apply to anyone with a positive net worth. Your money can also be "taken" under not so normal circumstances if the bank has to be bailed out and depositors are forced to take part in the bail out. “If I scare you this morning, and as a result you take action, then I will have accomplished my goal.” That’s what I told the audience at the Sprott Natural Resource Symposium in Vancouver two weeks ago. Given the amount of indebtedness in much of the world, inflation will certainly be part of the “solution,” with or without outright confiscation of your savings. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. In 2015, President Evo Morales nationalized $10.2 billion held in individual retirement accounts. Remember â when you put cash in a bank, it now belongs to the bank. I only ask because they keep asking how much I have saved when I fill benefit forms. However, it’s estimated that it will only generate $8.7 billion over 10 years, which equates to 0.18% of the current budget deficit. What’s a “bank liability”? I encourage you to pursue what steps are most appropriate for you now, before the door is closed. I do have some savings but they are below the threshold that becomes significant (£6000). A risk that most people think âcanât happen.â. © 2020 Equities News | Equities.com, Inc. * All dates and time are being displayed in Eastern Standard Time (EST). “So, what’s the big deal?” Some might think. A right of offset may also apply to accounts you hold jointly with others. The thought of the government repossessing your bank accounts might sound scary, and it is, but escheatment is an important process that helps the government keep the financial system running smoothly. Now, when it comes to questions of âhow will people workâ or âhow can businesses survive,â the answer is they will hand more free money out (to everyone). Iâm talking about growth trends that can scream up 5,000% or more â no matter what happens in the world. This generally occurs in situations where you have an outstanding government debt. Will individual governments jump on this bandwagon? And that’s based on rosy government projections. There will be no advance notice. So that the government would raise $9 billion over the next decade. In April 2013, Obama proposed to cap retirement accounts at $3 million…. Consider the risk that the U.S. federal government could go into your 401(k), IRA, or savings account, and âborrowingâ it to pay for government programs. The evidence is overwhelming and has already alarmed most investors; our greatest risk is not a bad investment but our political exposure. This is why I think that the institution of capital controls is a “when” question, not an “if” one. The momentum is clearly gaining steam for some form of capital controls being instituted in the near future. “In a reversal of its historic support for unrestricted flows of money across borders, the IMF said controls can be useful...”. The Bulgarian government came up with the idea of having $300m of private, early retirement savings transferred to the state pension scheme. Bolivia No, once the door is closed, your wealth is trapped inside your country. Unfortunately, it’s not just savings. It will be fast, cold, and cruel. they can not take it out of your savings account, but they can garnish your wages, seize any tax refund money, ect. He paid everyone $26.67 per ounce of gold he confiscated. I disagree: it establishes the principle, sets the precedent, and opens the door for other countries to pursue similar policies. There is no centralized narrative weâre trying to push. It seems like a ridiculous thing to have to ask: could the U.S. government arbitrarily take 10 percent of your savings directly from your bank account? Itâs used up by the first £12,500 of your wages. Some may counter that since Spain has relatively low tax rates and the bail-in rate is small, this development is no big deal. Then, after all the gold was collected, he immediately increased the price per Troy Ounce of gold to $35, dropping the purchasing power of all Americansâ cash holdings by nearly 40% literally overnight. “Ms. Iâm talking about amassing as much money as possible, as quickly as possible. Fair enough, but the “capital levy” prescription is still a confiscation of funds from individuals’ banks or brokerage accounts. As you’ve seen before, the possibility is being discussed as we speak. While the possibility of the government âborrowingâ from individual savings accounts may seem outlandish, you may find this history of government asset seizures to be interesting and useful. Notice also that one option is to simply inflate debt away. So let me share a few key points from my Sprott presentation and let you decide for yourself if you need to reconsider your own strategy. And that is exactly the possibility that is being discussed now as well. Meaning, in the years 2011-2024. Is it unsustainable? Originally Answered: When can the bank or government take your money from your own personal account ? They view international diversification as an extreme move. Itâs the risk of the United States federal government of going into your 401(k), IRA, or even your savings account, and âborrowingâ it to pay for social programs and wealth redistribution schemes. Your deposits. If your savings account has $10,000 and earns 0.2% interest, you are only taxed on the $20 in interest the bank pays you, not on the principal that drove those earnings. No matter how financially reckless politicians have been, it is your duty to meet your country’s financial needs. And don’t expect anyone below your tax bracket to feel sorry for you. If you forget about your savings account, the government could take possession of your savings account through a process called escheatment. Also, in 2008, a U.S. House of Representatives subcommittee heard testimony in favor of scrapping 401(k) plans and switching to “guaranteed retirement accounts.”. Itâs called the Trinity Retirement Blueprint, and it leverages your current subscriptions. Collect 10% – 36% from the U.S. Government, Volatility Isnât Bad â Itâs Profitable, Illinois Creates New $2.6 Billion Cannabis Market. In short: when the government is revenue-starved…our savings look like irresistible piles of cash. EU officials are explicitly telling us that the pensions and savings of its citizens are fair game to meet the union’s financial needs. If the government takes a portion of your assets, legally, who will you sue? Their savings turned out to be at the mercy of politicians, who saw them as a reservoir of cash to be drained at will. (Bolding for emphasis is mine. The government gained control over $14bn of people’s hard-earned money. This view effectively nullifies all objections. Instead, governments should take stronger action, much as rich economies did in past crises. If so, it could be more than just your home government that will clamp down on storing assets elsewhere. The IMF has made it clear that invoking a levy on your assets would have to be done before you have time to make other arrangements. Could it happen to your savings? 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