ATMs in Germany: Chips versus Magstripes

Although we take them very much for granted today, automated cash-dispensing machines have only been common since the late 1970s. Banks introduced the devices first in Europe, then in North America and elsewhere. Today there are an estimated 2 to 3 million ATMs in service around the world, with about 60,000 of them in Germany and 350,000 or so in Western Europe.

The German term for ATM is Geldautomat, but the Austrians and the German Swiss prefer Bancomat/Bankomat. Even in the English-speaking world there are several different expressions for automated teller machines: ATM, ABM (automatic bank machine, Canada), bank machine, cash machine, Cashpoint (actually a trademark), and hole in the wall (UK). ATMs have pretty much eliminated old-fashioned traveler’s checks. Remember those? Continue reading

American Expats, the IRS, FATCA and Other F-words

Besides “IRS,” Americans can now add another item to their list of ominous acronyms: FATCA. Like most things related to income taxes, the FATCA issue has a lot of people in a dither. As if US tax law wasn’t already complicated enough, along comes FATCA to gum up the works even more, especially for US citizens living overseas and earning income from a non-US source.

All US citizens or resident aliens living abroad are obligated to pay income taxes to the US Treasury, even if they haven’t lived in the United States for years, have no intention of returning, and even if their income comes solely from foreign sources. The United States of America is the only modern, industrialized nation that taxes the worldwide income of its estimated six million citizens who live abroad, even if their income is generated in a foreign country and they never return to their homeland.[1] Continue reading

Put Away Your Checkbook

Of all the things one can miss about a country after departure, the banking system probably shouldn’t be at the top of the list. For this ex-expat, however, it is actually one of the things I miss about Germany. The banking system there has arrived in the digital age, and North America is left in the dust.

For starters: put away the checkbook. Nobody in Germany has written a check in decades. When I arrived in 2000, checks were already obsolete. I was confused at the time: how do you pay individual people when you don’t have cash? The answer: bank transfers. In those dark ages of the internet, you paid others by filling out a paper Überweisung (transfer) slip, and giving it to your bank (possible via drop-box at most branches). Continue reading

Expatriates and the cost of living in A, D, CH

Expatriates don’t always have a choice of where they’re assigned to work, but they definitely need to know the cost of living in their assignment location. If your salary is paid by a US company, for example, that salary might put you at a huge disadvantage if you are working and living in Tokyo, Japan, which happens to be the most expensive city in the world for expats. (The news for Germany is much better.)

Companies with employees assigned to overseas locations usually offer some sort of cost-of-living allowance to supplement the increased costs. So even if you are going to an overseas location by your own choice, without company support, you need to know how the cost of living there compares to your current or home location. But how do you get that information? One excellent source is the website, from which we derived the rankings discussed here.

It may surprise you to learn that, except for New York City, Honolulu, Anchorage, San Jose and San Francisco, most cities in the United States of America have a far lower cost of living than places in Asia, Europe, Africa, South America – and even Canada! My own hometown of Reno, Nevada ranks 455th out of 780. Most places in the southern states of the US rank much lower than that. Continue reading

Schaffe Schaffe Häusle Baue

That’s nice thick Swabian for “work and work to build a house”. The Swabians are probably the most home-owning obsessed of the Germans, and even here, I’m not even sure that the majority of people live in their own property. Continental Europe in general is very different than the Anglo-Saxon world in terms of property ownership. Most Europeans prefer to rent, usually apartments near a city. Property ownership here is just not as popular, and people (hopefully) invest their money elsewhere. Our adventures with finding a home to buy took ages, then we gutted and completely renovated the darn thing. On the topic of Handwerker (a lovely catch-all term referring to builders, electricians, painters, plumbers, etc.) alone, I’m sure I could fill pages… but I’ll spare you (for now!)

In a rental property, as various other blog posts here have referred to, you get the walls and floor and ceiling and a functioning bathroom when you move in. Light fixtures, window coverings (except for external shades, Rollladen), and kitchens must typically be provided by the tenant. Many Germans have told me that it’s obvious why renters should buy and install their own kitchen: it is such a personal thing. Really? In a rental? Continue reading

Credit card differences

I was planning to write today about the problems sometimes encountered by Americans when they try to use their US credit card in Europe. As fortune would have it, I experienced exactly the reverse yesterday: Trying to use a German card in the US.

I was helping a German friend who is visiting us in the US use his credit card at a gas station. He inserted the German Deutsche Bank MasterCard into the gas pump. First he had to choose credit or debit. It’s a credit card, so he chose credit. Then a message appeared that I’ve seen a lot at gas pumps during my US travels lately: “Please enter your ZIP code.” Well, a German Postleitzahl is the same length as a US ZIP code, so he tried that. “Please see the clerk” was the machine’s response. We tried debit also, but it wanted a PIN that didn’t work. So it was off to see the clerk.

We were able to get the German card accepted with the clerk handling the transaction (and showing a German ID), but we had to guess how much gas we needed. If it was less than that amount, we would have to return to have the clerk enter a refund of the difference. Luckily, we guessed about right and did not have to do that. But the entire experience was a hassle caused by the differences in the way US and German credit cards function.

Basically, American credit cards are out of date (überholt in German). Continue reading

How many Germans are international travelers?

Germans have a reputation as travelers. They even claim to be the Reiseweltmeister (world champions of travel). Indeed, many citizens of Germany do travel abroad and in Germany. If you visit US national parks, as I did this month, you could get the impression that Germany is almost empty, and that most of the country’s population is in the US this summer. You will often overhear German, French and other languages as you hike the trails of Bryce Canyon, Zion, Arches, Mesa Verde and the Grand Canyon.

But in 2009 (the latest year for which statistics are available), Germans represented just 5.8 percent of all foreign visitors to the United States, totaling 1,881,944, a bit fewer than in 2008. That means that in 2009, barely two percent of all 82 million Germans crossed the Atlantic to tour the USA. Not only that, Continue reading

A 400-pound gorilla named Germany

Anyone who has followed the evolution of Germany and the European Union for as long as I have may be forgiven for thinking that Germany would always be the EU’s biggest supporter – in more ways than one. But lately, there have been signs that the gradual progression from the old Common Market of the 1960s to the EU and eventually on to a United States of Europe may be a much bumpier road than many once thought.

In the past, German policy regarding the EU reflected Germany’s history and the destruction of Europe caused by Nazi Germany. Along with the rest of Europe, German leaders realized that a unified Europe would help avoid the national conflicts that had so often led to European wars of conquest from ancient times on into the 20th century. In 1952, post-World War II German guilt and common sense led to the establishment of the European Coal and Steel Community (ECSC) by six countries: Belgium, France, Italy, Luxembourg, the Netherlands and West Germany. That modest beginning would lead to the “Common Market” (Treaty of Rome, 1958) and the European Community (EC) in 1967. By 1993, only a few years after German reunification, the 12 EC countries formed the more robust European Union (EU). Today the EU has 27 member states with a total population of about 500 million. Continue reading