Massive Amounts of Untouched Funds: Unraveling the Mystery Behind Their Existence
Unclaimed fortunes worth billions in Germany, left untouched. Ever wondered how that happens? Or what happens to the money? Here's a lowdown on that, plus some tips to keep YOUR money from becoming someone else's find.
Q&A Time
- What constitutes a forgotten or unclaimed account?
- How do accounts become forgotten or unclaimed?
- Can the account owners still be traced?
- What becomes of the money in these accounts?
- What's the German government's plan for the billions?
- What does the German banking industry have to say about this?
- How can you track your accounts?
- What else can you do to prevent account forgetting?
- How do you gain access to money in "inherited" accounts?
What makes an account unclaimed or forgotten?
Bank accounts, savings deposits, or savings contracts become unclaimed or forgotten due to various reasons, according to the analysis of various studies. Factors like frequently switching banks, relocations, deceased owners, and inadequate record-keeping can contribute to the forgetting of accounts. It's worth noting that account forgetting is not explicitly defined by law. More information on unclaimed accounts can be found in a briefing by the German Bundestag. Bundestag - Briefing on unclaimed accounts
Can account owners still be located?
When there's no activity on an account for a long time, banks generally don't actively seek the account holder, except in cases where family members of a deceased person suspect the account might still hold money. Then, the family members must approach the bank, prove their rightful inheritance status, and provide relevant evidence. Banks
What happens to the money in unclaimed accounts?
Unclaimed money remains on the original account and does not expire. The account holder's bank is responsible for holding the money until a rightful claimant appears. After 30 years, banks are obligated to write off the money and pay it as income tax. However, even after the 30-year period, financial institutions must still pay out the forgotten accounts if a legitimate claimant is found and provides adequate proof.
What's the German government's plan for the unclaimed billions?
The German government intends to collect the unclaimed money and invest it in a fund for social projects. In the Coalition Agreement of CDU/CSU and SPD, it states: "This means: The Federal Government could use the money from a German Social Impact Fund to support social innovations. However, the funds in the fund should remain repayable - in case a rightful owner or heir appears. As of now, no projects have been selected for the fund." Coalition Agreement: The most important points for NRW
The banking industry speaks out
Kathleen Altmann, from the Association of German Banks, recently stated, "Once a customer dies, his heirs inherit his legal position 1:1. Accounts without a known heir usually go to the federal state where the deceased had his last residence." In cases where there are no known relatives, German law dictates that the federal state is the rightful inheritor. Altmann also noted that accounts could potentially be affected by the federal government's plan if the customers have not maintained contact with the bank for an extended period, deeming the accounts dormant.
Keeping track of your accounts and preventing forgetting
To prevent account forgetting, it's recommended that you create a list of all your accounts and financial investments and review it at least annually. Alternatively, you could use a multi-banking app to manage all your accounts and stay up to date.
Another essential preventive measure is having a will that lists accounts and financial investments and contains clear inheritance instructions. In case of a move, don't forget to update your address with your bank.
Gaining access to "inherited" accounts
Heirs should obtain an inheritance certificate issued by the local court. Responsible for issuing the certificate is the local court at the deceased's last known residence. ARD: Will - how to inherit properly?
By staying vigilant and managing your accounts carefully, you can help ensure that your finances won't be left unclaimed and forgotten. Good luck!
- In some cases, the German government plans to invest unclaimed money from forgotten accounts into a fund for social projects, but the funds should remain repayable if a rightful owner or heir is found.
- To prevent account forgetting, it's important to create a list of all financial accounts and review it annually, use a multi-banking app to manage all accounts, have a will that lists accounts and financial investments, and update an address with the bank in case of a move.
