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A good two weeks ago, half of Germany was suddenly talking about looming negative interest rates for bank customers. The occasion was the People's Bank in Fürstenfeldbruck, which recently demanded from the first euro negative interest on daily and fixed-term accounts. Meanwhile, she is no longer alone: The People's Bank Westmünsterland at the other end of the Republic on the Dutch border threatens new customers now with penalty interest from the euro 1 - officially both speak of custody charges.
At the same time, these Volksbanks are obviously not concerned with the possibility of collecting additional money from their new customers. As high disbursement rates and unpleasant high account maintenance fees would be much more promising.
Rather, it's simply about a defensive attitude. The measures are aimed primarily at new customers: go with your money somewhere else, does not come to us. Because we really do not know what to do with it.
That's what customers should do. Because there are other possibilities. The insurer Cosmosdirect has just raised interest rates on new customers for the first 25,000 euros for an initial three months to 0.62 percent. Existing customers get for the first 25,000 euros at least 0.31 percent interest. Cosmosdirect, a subsidiary of the Italian Generali insurance, has been one of the reliable interest payers for customers in this country for years who want to park reasonable sums on a call money account.
Where to go with the money?
The defense reaction of the cooperative bankers from Fürstenfeldbruck, the Westmünsterland and elsewhere is understandable and sobering at the same time. Understandable, because cooperative banks and savings banks swim in the customer money. Some, such as Raiffeisenbank Pfaffenhausen, have even begun to build dozens of apartments themselves, to let them out and thus invest their customers' money. But many of them have no real idea what to do with the money. In such a situation, you do not want more money from new customers.
In the same way Volksbank Fürstenfeldbruck has justified its step. The defense conditions against new customers should protect the old customers, because one knows with their deposits not quite where.
The defense reaction is also sobering. After all, such dissuasive conditions and the whisper of bank lobbyists show that some banks would prefer to have their customers put their money in the locker. That costs with many banks from 50 euro in the year, makes with 25,000 euro in the locker 0.2 per cent fee / Verwahrentgelt.
Of course, if Volksbanks and Savings Banks blame the European Central Bank (ECB) and its negative interest rates for its own new negative interest rates, that is not right. Firstly, because no one forces banks and savings banks to store customer money on a larger scale and at a charge to the ECB and pay negative interest there. The idea of Bank is rather: Banks should economise with the money of their savers, give the plumber a loan, finance the farmers the tractor and the young family a cheap mortgage lending. Only compulsory deposits belong to an ECB account - and they have always been free of negative interest rates.
Secondly, the ECB has even lowered the costs of storage for the German credit institution, especially this fall: each bank now has a higher allowance for money, which it can park without penalty payments to the ECB. Only above this allowance did the ECB raise the negative interest rate to 0.5 percent per annum in September.
There are still interest rates - you just have to search
The bottom line is that banks will therefore have to pay less than € 500 million in negative interest rates to the ECB for the same deposit in 2020. No reason to demand more from your own customers now than 2018 or 2019.
But let's get back to the real problem: Banks should promote investments. Especially in difficult times.
That is the point of the ECB's negative interest rates: it does not want to reward the bank's management board if they have no idea about investing. The ECB consistently pursues this course.
In the summer, the industry service "financial scene" had published a list showing that meanwhile also 40 savings bank boards should call income millionaires, 33 of them from North Rhine-Westphalia. A nice personal return for well-done idleness.
Now, of course, one could argue that even bank customers expect a return for doing nothing. But here you have to make a clear distinction: Who parks the two to three-monthly income on a call money account to be liquid, if the car and the fridge break and never again in the outrageously expensive dispo, which does justice.
Even if the typical 0.01 percent credit interest at the house bank does not make fun, it's all about hedging: Spare in time, then you have in need. And of course the avoidance of 10 percent discretionary interest. And if you still want to get at least 0.3 percent, you have to compare again.
Anyone who already knows that he needs the money in a few years, can look for a good deposit account. At Credit Agricole, there is still 0.8% per annum over three years after the recent rate cut. Also better than leaving the interest-free at the house bank, and much better than every year to cost even 50 euros for the locker.
In fact, some banks no longer offer any time deposits: the Skatbank from Thuringia has withdrawn its fixed-term and overnight funds from the program. The Sparkasse Bremen offers online under the item "One time money" only stocks, bonds or gold. Sparkasse Essen only receives fixed-term deposits for ten years, and only 0.1 percent.
Go where there is still interest and return
If you have such a long time, you could also invest your money. Customers then only do what some high-paid bank directors no longer want to do. They only want to be paid high and no longer accept the more complicated work of investing as a bank.
But you can do that (as opposed to lending to the plumber) as a bank customer yourself, and that too manageable risks: for example, by putting money into a globally diversified equity index fund that emulates an index like the MSCI well. Since 1975, the risk of having a loss after 15 years was practically nil in every imaginable 15-year period. Even as the dot-com bubble burst and struck the big financial crisis - never in any of the 15-year periods around one of these events (or even both), there was a loss to complain at the end.
That does not mean that it necessarily has to stay that way. But it helps to classify the risk.
On average, the annual return over 15 years in recent decades was seven percent. If you had caught the best period, even 13 percent were in it.
Almost the best part: If you invest in so-called index funds (ETFs), you can beat the banks, who offer you virtually the same thing only as expensive funds with hefty fees. And especially in Germany in the past decades more than lived well.
Instead of two percent of fund fees a year, often with one percentage point remaining as a reimbursement from the banks, such index funds usually cost less than half a percent of fees a year.
Conclusion: If the bank manager threatened with negative interest, he means above all: I do not want your money. It is reasonable and perfectly okay to go somewhere else with your own money, where there is still interest and return.
Or to talk to the Bremen Town Musicians: You can find something better than the negative interest everywhere.