I won: The Veterans Administration and Me | 35 comments (35 topical, editorial, 0 hidden)

I have no clue what to do with the money but I have heard that it is bad to leave in in a savings account

You have heard from whom that it is bad how?

This is like how I hear all the time that renting is throwing away your money and you should own your home. If I had listened to the clamour of the Beotians and taken a mortgage on a London home in 2006 I'd be in a world of pain right now.

if the dollar becomes worthless, I am in a world of hurt

You live in Europe now, and you say the VA will put the money into a Euro account in a German bank, so what do you care what happens to the dollar once you get the money?

I am seeking suggestions to bring up with my financial advisor

My suggestion is don't talk to a financial advisor. And if you do, don't put your money into any product you cannot figure out (yeah, I mean doing the math and reading the legal small print) for yourself. I suspect if you follow the second part of the advice, meeting with the advisor is a waste of time.

The brainless should not be in banking -- Willem Buiter

by Carrie (migeru at eurotrib dot com) on Wed Mar 24th, 2010 at 09:15:03 AM EST
[ Parent ]

Re: That is only because (4.00 / 2)

You live in Europe now

He may have other sources of income: Social Security, pension, 401k etc that are impossible, or very expensive, to move to Euro accounts.

by gk (gk (gk quattro due due sette @gmail.com)) on Wed Mar 24th, 2010 at 09:29:39 AM EST
[ Parent ]

Re: That is only because (none / 1)

We're not being told that. We're only being told about a € lump sum to be "protected" - JD broached the issue of deposit insurance to "protect" the lum sum against one clear danger. Maybe we're not getting the full picture but then again, we're not financial advisors nor are we being asked for investment advice.

The financial advisor will do the following: they will ask about current income, age, assets and desired post-retirement income and will advise on a pension plan made of an initial lump sum plus periodic contributions out of income. If any money is left over they will advise on how to increase the capital. They will do a standard "so much percent into government securities, so much percent into corporate debt, so much percent into equities" and so forth with a "low/medium/high" risk-profile adjusted for age and proximity of retirement and will offer a collection of managed funds with various advertised risk/asset profiles.

In other words, a load of hogwash.

Since we haven't heard anything specific to protect against other than insolvency of the custodians of JD's assets, and suitable discussion of deposit insurance has been had...

The brainless should not be in banking -- Willem Buiter

by Carrie (migeru at eurotrib dot com) on Wed Mar 24th, 2010 at 09:40:29 AM EST
[ Parent ]

Re: That is only because (none / 1)

I am currently rated 60%, which is

Veteran Alone $974

With this new rating I am looking at lifetime payments (as long as the US Treasury is solvent) of:

70% 80% 90% 100$%
Veteran Alone $1,228 $1,427 $1,604 $2,673

Lifetime monthly payments

"Schiller sprach zu Goethe, Steck in dem Arsch die Flöte! Goethe sagte zu Schiller, Mein Arsch ist kein Triller!"

by Jeffersonian Democrat (rzg6f@virginia.edu) on Wed Mar 24th, 2010 at 02:37:27 PM EST
[ Parent ]

Actually (none / 0)

No 401k. Social Security Disability is being determined with the courts and my attorney at the moment. That is another, at least 40lk since my claim is from 2005. But I am not including that in my award at this time. The VA decision certainly helps with the SSA With the VA decision, SSDI is looking more promising.

There is also the possibility, because of the tax treaties, that once I receive my Niederlassung, permanent residence permit here in Germany, that my years of contributing to SSA will count for German retirement insurance.

"Schiller sprach zu Goethe, Steck in dem Arsch die Flöte! Goethe sagte zu Schiller, Mein Arsch ist kein Triller!"

by Jeffersonian Democrat (rzg6f@virginia.edu) on Wed Mar 24th, 2010 at 09:54:08 AM EST
[ Parent ]

Re: Actually (4.00 / 2)

My understanding of the latter point is that the tax treaties mean that time spent working in either country contributes to the minimum amount of time you need to qualify, but that you actually get paid from both countries in a way that is related to how much you paid in each (and, I'm afraid, in the appropriate currencies as well).

by gk (gk (gk quattro due due sette @gmail.com)) on Wed Mar 24th, 2010 at 10:17:22 AM EST
[ Parent ]

Thanks Migeru (none / 0)

I understand that the inflation does not keep up with the savings rate of a savings account. Therefore savings accounts are bad.

Your advice not to listen to any financial adivsor is sound. I can understand Goethe and Schiller and poetry. But when it comes to bureauratic and legal German, it's all Greek to me. It is hard to understand.

So I am like a child, I am like a pensioner with money to take - a fool with their money is soon parted!

I just do not wish to be a fool

"Schiller sprach zu Goethe, Steck in dem Arsch die Flöte! Goethe sagte zu Schiller, Mein Arsch ist kein Triller!"

by Jeffersonian Democrat (rzg6f@virginia.edu) on Wed Mar 24th, 2010 at 09:40:50 AM EST
[ Parent ]

Re: Thanks Migeru (4.00 / 7)

I understand that the inflation does not keep up with the savings rate of a savings account. Therefore savings accounts are bad.

It is possible that this is not the case right now. Banks are still starved of cash, if you can believe it, to beef up their "core capital". So it is possible that certain deposit or money market accounts (even some checking accounts) pay high interest rates. In addition, right now we're experiencing deflation.

I am like a child, I am like a pensioner with money to take

Widows and orphans have no place in the financial casino. So we regulate mutual funds in order to make them "safe" for widows and orphans. But in making them "safe" we make them slow and vulnerable to nimbler market players so they are just like the proverbial widows and orphans. So the widows and orphans lose their money in the casino anyway. So, the moral of the story is: if you're not safe by yourself in the casino, don't give your money to someone else to play in the casino for you.

The brainless should not be in banking -- Willem Buiter

by Carrie (migeru at eurotrib dot com) on Wed Mar 24th, 2010 at 09:49:24 AM EST
[ Parent ]

I won: The Veterans Administration and Me | 35 comments (35 topical, 0 editorial, 0 hidden)

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