How much will EUR bailout cost you?

Each household in the country will be contributing nearly £5,000 if Britain had to stump up £115billion for euro bailouts. There are fears the International Monetary Fund’s (IMF) £250billion war chest are horribly insufficient to save countries.

Table of contents

How much will EUR bailout cost you?

EUR bailout cost

Each household in the country will be contributing nearly £5,000 if Britain had to stump up £115billion for euro bailouts. There are fears the International Monetary Fund's (IMF) £250billion war chest are horribly insufficient to save countries.A fund of around £2.6trillion is the new target according to sources in Washington. Christine Lagarde, IMF managing director, said £250billion ‘pales in comparison with the potential financing needs of vulnerable countries’ and needs to be expanded to deal with ‘worst-case scenarios’.Her warning came as U.S. President Barack Obama said the debt crisis in Europe is  ‘scaring the world’ and that eurozone leaders were not dealing with the issue quickly enough.And a top Bank of England economist urged leaders around the world to stop the world plunging back into recession.‘It’s doing something rather than just saying something that counts,’ said Ben Broadbent, a member of the Bank of England’s Monetary Policy Committee charged with setting UK interest rates.Britainis liable for 4.5 per cent of IMF funding – meaning it would have to contribute around £115 billion to an enlarged bailout fund, or £4,600 per household.It is conceivable that figure may turn out to be slightly lower because Britain’s share is falling as rapidly growing economies such as China contribute more. Britain has already handed over £12.5billion in emergency loans to Greece,Ireland and Portugal to help prop up the euro.Chancellor George Osborne has refused to make more British money available to rescue the single currency but would find it difficult to resist a call from the IMF.The IMF raises money from its members and steps in to support debt-ridden countries such as Greece and Ireland with emergency loans.Following crisis talks in Washington at the weekend, Mrs Lagarde said: ‘The Fund’s credibility, and hence effectiveness, rests on its perceived capacity to cope with worst-case scenarios. Our lending capacity looks comfortable today but pales in comparison with the potential financing needs of vulnerable countries and crisis bystanders. It will be useful to discuss, soon, the needs and contingency options.’Plans are already in place to increase the size of the rescue pot to nearly £650billion.Her predecessor Dominique Strauss-Kahn, who was forced to quit after he was arrested on rape charges which were later dropped, hoped to increase the war chest to as much as double that amount.It is understood that Mrs Lagarde wants to go further. A source in Washington said: ‘This is for the long term. There needs to be a serious discussion about the scale of the fund.’The eurozone crisis has shown it is no longer just small developing countries at risk of drowning under a sea of debt.Jennifer McKeown, a senior European economist at Capital Economics, said an enlarged war chest of between £1.3trillion and £2.6trillion ‘looks sensible because there are a lot of other countries around the world that might need help’.It is feared that a Greek default will wreak havoc across the eurozone, with banks suffering punishing losses and larger countries such as Italy and Spain being dragged down.The crisis threatens to eclipse the collapse of U.S.investment bank Lehman Brothers three years ago when banks dragged the world into recession. Edward Meir, a senior analyst at brokers MF Global, said: ‘These are very critical days, reminiscent of the touch-and-go situation we were in back in 2008.‘The key difference this time around is that it is countries and not companies that are in danger of going bust.’Mr Obama told a public meeting in San Francisco that the debt crisis in Europe was one of the principal reasons why the U.S.economy was faltering.‘European nations are going through a financial crisis that is scaring the world and they are trying to take responsible actions but those actions haven’t been quite as quick as they need to be,’ he told supporters at a town meeting. Mr Obama has seen his approval ratings hit by rising unemployment and fears the U.S.could slide into  another recession.

Join our Newsletter

Subscribe and get the latest updates about inheritance tax and Estate Planning into your mailbox.

We help people with over £1 million in current assets pay ZERO in UK inheritance tax

One stop comprehensive specialist advice - Tax, financial planning and legal advice service with 18 years experience.

What our clients say
Read our 125
    
reviews

"It is gratifying to finally come across an adviser who gives sensible ongoing advice which is very client focused."

Frank Hibberd

Retired gentleman

"It is nice to know that we can now be certain that our daughter will inherit our money without giving a large slice of it to the government ."

Tony & Sue Perriss

"Everyone's situation is different but having an initial discussion with Charles has really helped me personally navigate what can be a daunting subject."

Bobby Chadda

"I particularly want to thank you for the open and transparent manner in which you have serviced my tax planning needs since I first met you seven or so years ago. In arranging my tax planning through you, I have confidence"

Michael Mahon

Retired gentleman

"Charles was really helpful from the outset and quickly clarified our situation for us... I have used Bluebond for  IHT and other tax advice and they have been very helpful with both. Charles is a very experienced and knowledgeable individual and I highly recommend Bluebond's services."

Sam Attenborough

Retired gentleman

I have used Bluebond for setting up a discretionary trust for my children as well as inheritance tax and estate planning for my home and  other properties. Having searched for years, it was only after meeting and speaking with Charles that I felt confident enough to take these next steps, and I'm very glad I did. His ability to explain complex issues in simple terms and walk you through every step of the process is quite simply unparalleled.

Imran Qureshi

Excellent and comprehensive advice concerning all things financial in one place. Enthusiastic, Educational, Expert, value oriented, Professional and Polite are adjectives that come to mind as well as great attention to detail.

Deirdre Buckley

Inheritance tax is a minefield. Charles de Lastic of Bluebond Tax Planning is the best in the business at helping you to chart the path that is right for you to ensure your estate is structured in the most tax efficient manner.

Nicholas Dickinson

Charles provides clients with valuable insights that clearly demonstrate expertise built over the years. Charles and his team guided us through a estate planning journey and then addressing complex Inheritance Tax matters. They have been very transparent with their advice and cost. Overall an excellent service. Highly recommended

Shailesh Karia

The information contained in this web site is for UK consumers only.  Like most firms of solicitors and accountants, Bluebond Tax Planning is not regulated by the FCA. The content of this website does not constitute FCA regulated financial advice and all content is provided for general information purposes only. Bluebond is not responsible for any action you may take as a result of information on this site. All advice will be delivered on a personal basis once we fully understand your situation and our client agreements have been signed.

Copyright © 2024 Bluebond.co.uk
-
Copyright Notice
-
Legal Disclaimer
-
Terms & Conditions
-
Privacy Policy