Author Topic: 401k and foreign bank statements  (Read 559 times)

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Offline mathremuk

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401k and foreign bank statements
« on: March 17, 2017, 06:04:24 PM »
Hiya,

Hubby just mentioned he had 80k dollars in his 401k retirement fund which is now at a standstill now hes here. Can we use this towards financial requiment. He seems to think he can cash it but with a penalty. If we can use it what do we need? A letter stating everything with the penalty.

Also we need to use some US bank statements for a rental. Can we ask the bank for a headed letter or do the US do stamps on each page like we do? Excuse the confusion. I have no idea about US banks.

Thanks!!

Offline mathremuk

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Re: 401k and foreign bank statements
« Reply #1 on: March 19, 2017, 05:17:33 PM »
AppendixFM 1.7: Financial Requirement May 2016


7.4.4.
For example, in
the UK a ‘stocks and shares’ Individual Savings Account (ISA) does
meet the definition of a savings account and the funds can be considered as cash savings if all the requirements above are met. Likewise, a pension savings account from which savings can be immediately withdrawn.

This would make me think we dont have to liquidate the account. We actually only need a couple of hundred pounds to take us over 18600 so surely this will be accepted.?

Ive been reading conflicting posts about cashing the 401k in. I guess we are just going to have to be the guinea pigs as we arent prepared to cash it in.

I also read they count the total before penalty which is weird. It also seems they used to state that 401k was fine in the financial requirement doc but that sentence isnt in there anymore. It used to be in 7.4.4 from what I see on posts.

Online ksand24

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Re: 401k and foreign bank statements
« Reply #2 on: March 19, 2017, 05:49:15 PM »
You don't need to cash it in. As long as it can be accessed immediately, it can stay in the 401K. Several people have used 401Ks with no issue. As long as the money has been in there for 6 months, you should be fine.

How much exactly do you have in the 401K at the moment? And when do you apply for the visa again? Right now, the Oanda exchange rate shows $80,000 is £64,529... and you only need £62,500 to meet the requirement, so unless it drops drastically between now and when you apply, you won't need to use anything extra (£62,500 is currently $77,484).

Yes, 401K used to be mentioned in the documentation but it was taken out in 2015. No idea why since the rest of the wording is the same... maybe they didn't want to single out the 401K specifically.


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Offline mathremuk

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Re: 401k and foreign bank statements
« Reply #3 on: March 19, 2017, 06:43:14 PM »
Thank you for clarification.

On previous calcs id worked out our income wrongly so we have rental income and husbands employment income but it only just falls short of the 18600. So we were going to still submit this and also the 401k to cover ourselfs. Im assuming i can submit all three catergories. I havent checked that yet.

I think he has just shy of 80k dollars.  Its a blessing really as i didnt think we were goong to make it!

Also do they just need a headed letter with the following from the 401k people

-account number
-length held
-value
-statement to say its readily accessible

Also US bank accounts as we cant get them stamped like here do we ask for a headed letter for them too? We rent land over there and are planning to add that to our total too.

Thanks

Online ksand24

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401k and foreign bank statements
« Reply #4 on: March 19, 2017, 06:50:28 PM »
Hang on, if you have the 401K, then just use that and don't even mention the employment or rental.

All you need to do is apply under Category D and include the evidence of the 401K. That's it.

You're making things unnecessarily complicated for yourselves by trying to apply under 3 Categories when you already meet the requirement under just one category, and they won't even look at the other categories anyway. You should only use more than one category if you cannot meet the requirement under any one single category... but you do.

Category D: Cash Savings is the absolute easiest category to qualify under in terms of paperwork and many people would happily just use that category instead of having to worry about whether they meet the £18,600 by income alone (which you don't anyway).

So, forget about his employment income and your rental income and just use the 401K.

If the exchange rate changes drastically and the 401K drops below £62,500, then I'd just add the rental income as a second category as that's probably easier for paperwork than the employment.


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« Last Edit: March 19, 2017, 06:54:28 PM by ksand24 »

Offline mathremuk

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Re: 401k and foreign bank statements
« Reply #5 on: March 19, 2017, 08:19:16 PM »
Dont ask me why I didnt think of that doh 😣.  Thank you!

What is the evidence I need for the 401k? Hubbie doesnt know where his statements are and I think he said he only gets them yearly.

Online ksand24

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Re: 401k and foreign bank statements
« Reply #6 on: March 19, 2017, 08:31:21 PM »
Dont ask me why I didnt think of that doh 😣.  Thank you!

No problem :).

Him having enough money in his 401K is actually a godsend for you - it means you can qualify for the visa no matter what.
 
If he loses his job... no problem, you meet the requirement without it.

If the exchange rate drops... no problem, you can use your rental income to make up the difference :)..

Quote
What is the evidence I need for the 401k? Hubbie doesnt know where his statements are and I think he said he only gets them yearly.

From the official requirements:

Quote
7.5.1. The evidence required for cash savings is specified in Appendix FM-SE: 11. In respect of cash savings the following must be provided:
(a) Personal bank statements showing that at least the level of cash savings relied upon in the application has been held in an account(s) in the names of the person and their partner jointly throughout the period of 6 months prior to the date of application.
(b) A declaration by the account holder(s) of the source(s) of the cash savings.

So, I would assume you need the latest original statement(s) from the 401K showing that the $80K has been held in full in the account for at least 6 months. And I guess maybe also include a letter stating the account details as well.

Can he request new statements from the 401K people showing the money in the account?

Offline mathremuk

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Re: 401k and foreign bank statements
« Reply #7 on: March 19, 2017, 08:47:16 PM »
Yeah Id imagine so. We are going to call them tomorrow and get this done and get a letter written.  Hes fully vested and its all in his name.

I think i didnt realy think we could use it as its all stocks and shares and id read so much about converting it to cash. Thats why id kind of thought well we could submit it as making up the shortfall.

I feel this huge sigh of relief! I cant believe he failed to tell me about this but he just assumed it wouldnt be counted either!

Online ksand24

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Re: 401k and foreign bank statements
« Reply #8 on: March 19, 2017, 09:05:30 PM »
I think i didnt realy think we could use it as its all stocks and shares and id read so much about converting it to cash. Thats why id kind of thought well we could submit it as making up the shortfall.

But it wouldn't work that way - for Category C, only INTEREST gained from stocks and shares can be counted... so you would have to prove an annual income from interest from the money in the 401K, and show that this income would continue to be earned in the future.

So, really, the best way to use the 401K is as cash savings... and in that case, you meet the requirement anyway, so there's no shortfall to make up.

As long as it can be accessed immediately, even if there's a penalty, there is no requirement to cash it out.

Quote
I feel this huge sigh of relief! I cant believe he failed to tell me about this but he just assumed it wouldnt be counted either!

Ah, see, never assume :P.

If he'd mentioned a few months ago that he had a 401K, we could have explained it all to you back then and you wouldn't have had to spend all this time worrying about meeting the requirement :).

Offline mathremuk

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Re: 401k and foreign bank statements
« Reply #9 on: March 19, 2017, 09:23:59 PM »
If im your way anytime in the future I owe you a drink.

We went to Lincoln xmas market in 2015. Beautiful!!!

Thanks so so much

Online ksand24

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Re: 401k and foreign bank statements
« Reply #10 on: March 19, 2017, 09:32:54 PM »
If im your way anytime in the future I owe you a drink.

We went to Lincoln xmas market in 2015. Beautiful!!!

Thanks so so much

No problem :).

The Lincoln xmas market is nice, isn't it? I've only been to it once, in 2012, I think it was. It's really busy though, so I tend to avoid that area of the city when the market is on (though I always seem to be working overseas around December time, so I keep missing it) :P.

Offline mathremuk

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Re: 401k and foreign bank statements
« Reply #11 on: March 20, 2017, 06:15:26 AM »
So we checked the full amount and although he has 90k only 70k is accessible as the rest is locked down for some reason. With our rental we still fall short by 208 pounds. Typical  ::) So we are still going to have to go down the employment route 😣

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Re: 401k and foreign bank statements
« Reply #12 on: March 20, 2017, 07:03:31 AM »
So we checked the full amount and although he has 90k only 70k is accessible as the rest is locked down for some reason.

Can you find out why it's locked down and if there's any way to access it?

Is it possible to cash out the whole thing, maybe?

Quote
With our rental we still fall short by 208 pounds. Typical  ::) So we are still going to have to go down the employment route 😣

Hang on, it's calculated differently if you're switching between cash savings and income.

The amount of income your cash savings are equivalent to is calculated in the following way:

(£62,500 - £16,000) / 2.5 =  £18,600... in this case, it equals £18,600, so no extra income is needed.

The Oanda exchange rate shows that today, $70,000 is £56,463, so using the calculation:

(£56,463 - £16,000) / 2.5 = £16,185.20.

So, you can show £16,185.20 of annual income in cash savings and so the only rental income you need to show to meet the requirement is:

£18,600 - £16,185.20 = £2,414.80 per year.

Offline mathremuk

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Re: 401k and foreign bank statements
« Reply #13 on: March 20, 2017, 11:29:54 AM »
Ok im mega confused now lol. Whhat a weird calculation.

Rental is 5830 for 11 months at the time we apply (mid may). I thought we had an extra month but when i printed off the paperwork ot turns out the tenants/estate agents first payment was a month later than id thought.

So we are good then .

Im guessing i will be pulling your hair out again when i revisit the applicatiom form and fill out that section again!

Online ksand24

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Re: 401k and foreign bank statements
« Reply #14 on: March 20, 2017, 12:07:13 PM »
Yes, you are good.

Basically, with the cash savings, they don't count the first £16,000 and then you need 2.5 years worth of £18,600. But for income you just need to show £18,600 per year.

What they do is work out how much 'per year' your savings are worth in terms of income and then you can use actual income to make it up.

If you have no income then for savings you need to show you have 2.5 years x £18,600 plus the initial £16,000... which comes to £62,500.

However, if you have an income of say, £15,000, then you need to make up the difference with savings in the following way:
£18,600-£15,000 = £3,600 to make up.

So in savings you would need:

(2.5 years x £3,600) + £16,000
= £9,000 + £16,000
= £25,000 in savings.

Now, in your case you have $70,000 in savings and you need to know how much per year that is worth towards the £18,600 requirement... so you work backwards.

Currently $70,000 is £56,463 with the exchange rate.
Take off the £16,000 and you have £40,463.
Divide that by 2.5 years and you get £16,185.20 per year.

So through cash savings you can show £16,185.20 per year towards the annual income requirement of £18,600.

Now you just have to make up the difference with your rental income:
£18,600 - £16,185.20 = £2,414.80 per year in rental income, or £201 per month.

You make about £500 per month in rental income so you have more than enough.


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