Monday, October 30, 2006

Paying Money Overseas

Paying money overseas gets easier and easier as credit card payments get more widespread internationally. But sometimes you need to pay in foreign currency. It isn't hard to do this if you know how. You go to your bank and either buy an international money order and mail it or wire the money to an account directly. But you need to know. I was just talking to my mother today. We are still trying to get money from the German government in compensation for property that was seized by the Nazi regime. As an aside, this is one reason I'm not a big fan of real estate as an investment. It is a long story - the property is in Eastern Germany and until 1989 there was no way to get anything from the Communist government of the Deutsche Demokratische Republik. Some time after 1989 (1995) we were contacted by a lawyer that we could make a claim and since then we have been in process. We have received some money. My mother decided to split our share of the value between my brother and I. So far I've received about $7000. This was my share of one of our properties. Now we are trying to get the money for the second property and several months ago the German government required us to pay a small number of Euros as a fee to get to the next stage. Finally, today I understood that the reason this is still held up is instead of paying in Euros my mother sent a personal check in Sterling drawn on her bank in London. Obviously the check hasn't been cashed. It would probably cost the government agency there about as much to cash a personal check in foreign currency as the fee is worth... Her reason why she didn't send payment in Euros is that the bank where she lives gave her a hard time about paying in Euro. I can't really get a straight answer why. I think they just told her it would cost a lot and discouraged her so she took the "easy" way out and sent a personal check in the wrong currency. I told her to phone the lawyer and tell him what she did and what can she or he do next.... Hopefully soon this story will finally be over


Revanche said...

Is this part of the reason why you asked about why inheritances aren't included in the retirement planning calculator? I know you previously mentioned your mother is comfortably well-off as well.

mOOm said...

Yes. This money is just the tip of the iceberg. Between my existing retirement accounts and the money I am supposed to inherit I have the retirement problem solved. When I am 60 I will have plenty of money (too much given my frugalness on the consumption side) unless things go every wrong with the world in the meantime. Which is one reason I am not a big fan of retirement accounts. I am a tenured professor so I also have a job for life if I want it. So my financial "issue" is how to become financially independent sooner (I am almost 42 now) - so that is what my blog is directed towards.

I am a very fortunate person in this regard. But take the example of my friend in Virginia. He has been pretty much broke all his life - he is now 44. He is about to receive an inheritance of something above $100k or so probably - which isn't very much really. This will finally allow him to buy a house, open a retirement account etc. It will transform his financial life.

Some other bloggers such as Claire have talked about inheritance and gifts from family. I think though in most middle class families people are surprised when one day they receive unexpected money. My father's family was once quite wealthy but we grew up very much at the lower end of the middle class. Some day I plan to write some blog posts about all of this.

mOOm said...

PS: My aunt in London who is definitely not rich at all is waiting to get her share of the money from Germany (twice what I'll get). I think she could really find it useful.