When a child is born, everything changes. As parents, we want the best for our little ones. Love and safety are important, but so is financial freedom. Whether it's for a driver's license, university, or their first apartment, starting early with ETFs is the best gift you can give. In my Remote consultation, I show you how small steps today lead to big goals tomorrow.
Key Facts at a Glance
| What it provides | Long-term wealth building for your child, usually in ETFs, with a very long term and compound interest effect. |
|---|---|
| Limits and drawbacks | Costs with insurance solutions, market risk and the question of who owns the money later. Details |
| Who needs it | For parents, grandparents and godparents who want to build starting capital for education, a driving licence or retirement early on with small amounts. |
| What does it cost | It depends on your personal situation. I will gladly prepare a non-binding quote for you: get in touch. |
| What to look out for | Low costs, who is the policyholder and beneficiary, flexibility for top-ups and withdrawals and a later transfer to the child. |
Leon's Story: The power of time for a perfect start
Fictional example for illustration; all persons and events are invented.
When Leon was born, his parents decided to use his monthly child benefit (Kindergeld) wisely. They didn't just put it in a savings account. Instead, they invested €100 per month into a globally diversified ETF.
On his 18th birthday, Leon was amazed: the €21,600 paid in had become over €45,000 at an average return of 7%. This was possible because of the power of compound interest over nearly two decades.
With this money, Leon could pay for his driver's license, a first car, and had enough left for his university studies. Leon had a head start in life that made everything easier. His parents say: "It was the best decision we ever made for him."
Why old savings accounts are gone for Expats in Germany
In the past, parents used simple savings accounts. But today, inflation eats that money away. For 10 or 20 years, the stock market (via ETFs) is the smartest choice. Here is why:
- Maximum Growth: You use the growth of the global economy for your child.
- State Help: With the passed law, children will get subsidies in the new Pension Depot.
- Flexibility: You decide if the money is for school, a house, or their own retirement.
- Tax Free: Using a Depot in the child's name can save a lot of money on taxes.
Protecting their health too
Provision is not just about money. It is also about health. With an "option for occupational disability," you make sure your child can get important insurance later, no matter what happens to their health.
This is true responsibility. We check together which parts fit your family best. In our online meeting, we build a plan that grows with your child.
Requirements for Expats
- Valid German Address (Anmeldung)
- German Bank Account (IBAN)
- German Tax ID
Limits and Drawbacks
Starting early is a big advantage. You should still consider these points:
- Ownership of the money: If a depot is in the child's name, the money belongs to them and is freely available to them at 18.
- Statutory family health insurance (§ 10 SGB V): With a junior depot in the child's name, high realized capital gains (above €565 per month or €6,780 per year plus the €1,000 saver's allowance in 2026) can lead to the loss of free statutory family health insurance (GKV-Familienversicherung), whereas gains inside a child pension insurance policy do not count as income during the accumulation phase.
- Costs: With insurance solutions, costs reduce returns; look for net tariffs.
- Market risk: The value fluctuates; a sufficiently long investment horizon is important.