In United States, I have noticed some desi people don’t like to keep a lot of cash in their bank accounts. What they do is get a locker at the bank, after getting their salary through direct deposit, withdraw 75% or so of their salary and keep it in their lockers and some at home. This way they believe that the government won’t know how much money they have, and they can get medical and other benefits, or if need be can take big sum of money back to Pakistan easily, etc. So please explain the advantages and disadvantages of doing so, and should that be done. I have also felt that such people are just scared/cautious after earning a good amount of money.
Re: How Much Cash should be in your Bank Accounts?
can’t say anyfin abt US banks but ur post rminded m of sumfin frm ma earlier dayz. i uze 2 work 4 a bank dat was X-BCCI n ma colleguez ova there use 2 nullify their accounts da same day their salariez were dposited. on ma query they told m k **Bank ka bharosa nahi hay pata nahi kub bund haujayay ** 
Re: How Much Cash should be in your Bank Accounts?
Well, if you are talking about BCCI, then considering what happened to the bank eventually, in hindsight those collegues of yours were probably not that far off the mark.
Re: first post, if the amount was deposited even for one day, and the guy is audited by IRS, he'll have to explain the source of income. And if the same amount is being deposited and withdrawn every month, I doubt there can be an alternative alibi that will satisfy an IRS inspector. So that thinking is probably based on myth. However, its possible some social security benefits require low bank accounts, but I have no knowledge of those. However, one thing is certain. Low bank accounts will translate to reduced assets that will negatively affect the credit score.
Re: How Much Cash should be in your Bank Accounts?
The amount doesn’t have to be direct-deposited for IRS to know about it. If it is legit income, the employer is already reporting to IRS by sending them W-2 at the end of the year.
Re: How Much Cash should be in your Bank Accounts?
Yup, same thing. Just withdrawing the money rightaway doesn't mean you didn't earn it or are not required to pay taxes.
However I think the crux of the original post is on getting benefits on the basis of low income. I don't know the eligibility criteria for governments benefits or whether it relies on income or savings. My guess would be income (in which case, the whole withdrawl thingy is a waste), but I am not 100% sure.
Re: How Much Cash should be in your Bank Accounts?
Do this... I fyou have relatives in Pak, then ask them to open a company. If you handle a lot of cash compensation, ask the payors to provide the payments to the Company in Pak. Hold the money in Pak, invest it in realestate or something, no on eknows, your asset base grows and you can over time take it out or leave it there.
Ain't i right Faisal?
Re: How Much Cash should be in your Bank Accounts?
I don't know. I am not too familiar with double-tax treaties or cross-country fx movements.
Plus, I thought the guys who withrdraw monies plan to apply for government benefits.