Totally Frenched Out

From the blogger formerly known as Samdebretagne

Sunday, October 7, 2012

French savings

I'll post more about the big first day soon, but I wanted to put a quick note out there for those of you who have French savings accounts. On October 1, 2012, they upped the maximum deposit limit for the Livret A and the LDD.  The livret A max went from 15,300€ to 19,125€ and the LDD max went from 6,000€ to 12,000€.  My bank did not give me any notice of this at all, and in talking to friends, theirs didn't either, so I wanted to get the info out there.

These two have the highest interest rates when compared to most other livrets (and it's still a piddly 2.25%), but it's worth moving money around to reach the new plafonds if you've got it - extra interest is after all extra money!  Just be sure to do it before October 15th, since interest on French livrets is calculated only every 15 days - so if you put money in after October 16th, you won't earn interest on it until November 1.

*As an FYI, if you're looking for a savings account, these are two good options because 1) they are free to open, 2) you can move money in and out of them as needed at no cost and 3) you will not pay any income tax nor social charges on the interest earned.

**There is also another livret called the LEP available for those who paid less than 769€ in taxes last year, and it has a little higher interest rate of 2.75%.

***A little off-topic, but I learned recently from a friend that Americans should avoid opening French "assurance vie".  I'm not sure I understood it 100%, but it sounded like that with the new legislative changes in the US, you will be required to inform the US government as to the nature and provenance of the interest earned on your "assurance vie", as in listing out what exactly what you earned from each stock your assurance vie invests in. Apparently it is quite complicated to figure out, even for tax professionals, so her advice was "If you don't want to have to pay someone to do your US taxes, it's best to put your money elsewhere if you can". (Plus just to make it even more confusing, assurance vie is not the equivalent to the US life insurance anyways - it's more of a retirement savings account).

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Anonymous Anonymous said...

thanks for the info Sam, didn't know either.

October 7, 2012 at 12:07 PM  
Blogger Mills (héron + hibou) said...

Thanks for sharing this kind of info. It is so helpful. I am always a little lost when it comes to my taxes over here.

November 13, 2012 at 12:49 PM  

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