It is official: The German Bundestag passed the new Pension Reform Act on March 27, 2026. Starting January 1, 2027, the new Pension Depot (Altersvorsorgedepot) will revolutionize private retirement savings with a high-yield investment model and state-supported flexibility.
The Core Benefits for Expats in Germany
- No Capital Guarantee Obligation: You can choose 0%, 80%, or 100% guarantee. The 0% option allows for 100% ETF exposure and maximum long-term growth.
- New Subsidy Model: You receive a 50% subsidy on your first €360 invested, and 25% on further contributions up to €1,800. This equals a maximum basic grant of €540 per year.
- Child Grant (100%-Rule): For every Euro invested for child-related savings, you get a 100% grant (up to €300 per child).
- Young Professional Bonus: If you are under 25, you receive an extra €200 annually for 5 years as a state bonus.
- Tax Advantages: Contributions are tax-deductible up to €3,000 annually (rising to €3,500 in 2030).
- Flexibility & Payout: Payouts can start at age 65. You can choose between a lifelong annuity or a flexible withdrawal plan until age 85.
- Full Portability: Transfer your existing Riester capital into the new depot without losing your accumulated subsidies.
- Inclusion of Freelancers: For the first time, self-employed professionals and freelancers are fully eligible for state subsidies.
Retirement for the Digital Age
The German government has finally addressed the flaws of the old Riester system. The new Pension Depot follows a clear philosophy: Low costs, high transparency, and state support.
As an independent broker, I help you navigate these new rules. We'll find the right certified provider for your depot and ensure you maximize the 20% subsidy and child grants.
100% ETF Focus
Choose your own certified ETFs and capture global market growth without the weight of expensive insurance fees.
Flexible & Portable
Change contributions or providers at any time. It's your personal depot, fitting your international career.
Maria's Story: Why waiting for 2027 is worth it
Maria is a 32-year-old expat working in IT. She wanted to save for her pension but was unhappy with the 'Riester' plans her friends told her about. "The costs are too high, and the profit is too low because of the guarantees," she noticed.
With the new reform, Maria can finally use a modern way to save. Instead of paying for expensive insurance, her money goes directly into a global ETF portfolio. The German state still supports her with subsidies, but Maria decides how her money is invested. For Maria, this means much more money when she retires, simply because the unnecessary insurance costs are gone.
Cost Comparison: Riester vs. Pension Depot
Why is the switch better? The main reason is the cost. While classic Riester insurance often has high annual fees, the Pension Depot (legally capped at a maximum effective cost of 1.0% per year for standard products) will be much cheaper. Here is an example of what this means over 30 years:
Classic Riester
Final capital after 30 years*
Pension Depot
Final capital after 30 years*
*Example: €150/month savings, 6% return before costs. Riester (1.8% costs) vs. Depot (0.5% costs). Values rounded.
Requirements for Expats
- Valid German Address (Anmeldung)
- German Bank Account (IBAN)
- German Tax ID
- Tax Residency: You must live and pay taxes in Germany to get the immediate tax benefits and subsidies.
- Social Security: You are usually an employee or a required member of the German state pension system.
- Residence Permit: You have a valid residence permit or plan to stay in Germany for a long time.
- No Refugee Status: These subsidies are for regular residents and workers. Different rules apply for other statuses.