Table of contents
You can never actually save money too early. For this reason, many parents want to start as soon as their child is born. If only you knew whether a current account, an ETF, a mutual fund or a building savings contract is the right one to invest in your child's future.
Also read:
With so many options on offer, you can quickly feel overwhelmed. So how do you find reputable and most profitable products without wasting money? We've been clever for you.
Define savings goals
Depending on what exactly parents want to save money for, the investment options also vary. So before you meet with the bank or representatives, you should define for yourself what you are saving for and how flexible the money or partial amounts should be available.
Also important:The more you decide for yourself, the more financial management you take on yourself, the lower the costs for bank advisors, commissions, etc. will be.
Reading tip:
Short-term savings
If you are looking for a 'safe' piggy bank for your child, i.e. you want to deposit and withdraw money flexibly, you should stick with a savings account. This has the advantage that the child experiences saving directly. For this purpose, a local financial institution is preferable to a direct bank (without a branch). However, you often get more interest from direct banks.
A pure savings account does not offer the opportunity to let the money work for you. Dealing with money is really the focus here.
Reading tip:
Saving for the child's education
If you can and want to invest the money for the long term, a fixed-term deposit account for your child is a good and safe choice. With a fixed-term deposit account, as the name suggests, the money is invested for a specified period of time. During this time you cannot deposit money into the account or have money withdrawn. There are higher interest rates during this time.
The longer the money is invested, the higher the returns.
A so-called savings bond is also a safe, long-term investment. An amount X is also paid in once for a set period of time at a fixed interest rate.
Important:If you invest money in a fixed-term deposit account or savings bond, it will not be available for this period. Created is created. There is no going back.
Create an inheritance
If you generally want to leave money to your child or children, you can turn a sum of money invested in a timely manner into a decent amount. Provided the money is really well spent. Parents should pay particular attention to ongoing costs, as these can noticeably reduce the return.
ETF savings plans are currently particularly profitable. As the consumer advice center writes, stocks are “the most profitable form of investment in the long term. However, they are also associated with high fluctuations in value for investors.”
Avoid unnecessary costs
No matter how you invest money in the bank or in an insurance company, the advisors and institutes usually earn money, often not too little. There are costs lurking here that 'eat up' a lot of the money that is actually supposed to be saved.
Like the consumer advice centerwrites, products such as training insurance or pension insurance, building savings contracts, gold accounts or investment funds are often not right for young consumers and their needs. Here, the intermediaries in particular earn a good commission.
Also read:
Better savings options
Stiftung Warentest has examined how parents can best save for their children. According to the testers, if you want to get the most out of your investments, you have to trade stocks, for example with the help of aWelt-ETFs. If invested for at least 10 years, the risk is low, but the chances of a good return are high (although not guaranteed).
According to Stiftung Warentest, anyone who wants to invest a sumFixed depositwell served. The money then grows through a fixed interest rate over the term and is safe. Statutory deposit protection ensures that the money is not lost even if the bank goes bankrupt.
For both stock ETFs and fixed-term deposits, parents have to decide whether it is in their own name or that of the child. If it is in your own name, you as a parent have full control over it, including the 'payment date' to the child. However, the capital gains are then also offset against the parents' tax allowances.
It is different if the deposit or fixed-term deposit is in the child's name. Then the parents only 'manage' the money until the child comes of age. There are tax advantages for this, because capital gains from children are not included in the parents' savings allowance. Children have their own savings allowance of 801 euros for capital gains.
But:If a child has saved more than 15,000 euros, this will affect the student loan if the child wants to claim this state support for their education.
Get neutral advice
If you are afraid of making bad investments or receiving inadequate advice and want to be on the safe side, you should ideally seek advice from a neutral body. TheConsumer advice centeris there a possibility, just like thatAssociation of Insured Persons, state-certified insurance advisors or fee-based advisors.
Also read:
These consultations are usually not free, but they are neutral and fair. The advisor does not receive a commission for a 'sold' investment product, but only for his or her consulting hour(s). The costs per hour are between 70 and 130 euros.
