The money from the statutory pension is often insufficient in old age.
Many people try to improve their retirement with private old-age provision.
Often in focus: ETFs (Exchange Trading Funds).
The statutory pension * is often insufficient to maintain the standard of living in old age.
Many people in
Germany
therefore start looking at private old-age provision * at an early stage.
ETFs
are designed to help provide
for
retirement
for little
money
and with little risk
.
Frankfurt - enough
money
for a carefree
retirement
.
Many people in Germany would certainly like that.
However, the reality is often different.
Because despite many years of professional activity, many find it difficult to maintain their standard of living after retirement *.
Even more: According to “zdf.de”,
around 3.1 million people aged 65 and over
in
Germany were
at
risk
of
poverty
in 2018
.
This corresponds to around 18.2 percent of the population aged 65 and over.
To prevent such a situation, many people in Germany no longer rely solely on the statutory
pension
.
You take care of private
pension provision
at an early stage
.
Some people in Germany use
securities
as an opportunity to amass a certain amount of
assets
at an early stage in
order to
improve
their
retirement
and private
retirement provision
.
Securities investments are becoming more and more attractive, especially in times of shrinking interest rates on fixed-term and overnight accounts.
Business with exchange-traded index funds, or
ETFs
(Exchange Trading Fund) for
short
, is booming.
"ETF savings plans are becoming more and more popular and are growing faster than savings plans based on actively managed funds," reports Jens Wöhler, board member at S Broker der Sparkassen, to "handelsblatt.com".
year |
ETF investment volume in billion euros (private investors) |
|---|---|
2015 |
7.7 |
2016 |
11.7 |
2017 |
16.6 |
2018 |
18.8 |
2019 |
30.7 |
Source: extraETF Research |
Private retirement provision with ETFs: topping up your pension over the long term with index funds
Index funds are
particularly interesting
for long-term asset
accumulation
.
They are considered to be comparatively cheap and involve little risk, reports “n-tv.de”.
But there are also a few things to consider if you actually want to have more
money
available
in old age
.
Basically, an
ETF is
a replica of a stock market index that makes it possible to invest in entire markets.
The bank or a fund company uses
the investors'
money
and buys, for example, all those securities that are contained in an index.
Means: An ETF that tracks the German share index (DAX), for example, will develop in value just like the
DAX
.
Exactly which stocks end up in the index is continuously monitored.
If the listing of the index changes, the ETFs change accordingly.
The aim of investing in
ETFs
is to achieve exactly the same return as the index itself. The index funds make use of the investor's know-how.
It's about swimming with the flow and generating long-term profits, for example for private
retirement provision
.
Not about
making
more
money
than the broad mass of investors.
Improve your retirement with private old-age provision: ETFs promise low risk
The big advantage of
index funds
: They are significantly cheaper than funds in which a so-called fund manager decides in which companies and stocks to invest.
As the “finanztip.de” portal explains, interested parties not only save the agency fee for purchasing such automatically managed
ETFs
.
The running costs should also be barely a seventh as high as with active equity funds.
Anyone who is faced with the decision
to invest
for private
retirement provision
and invest
money
in securities should first ask themselves how willing they are to take risks.
Because
ETFs
pay off in the long term.
Short-term and temporary losses should be accepted by investors.
In these moments in particular, it makes sense to stick to the long-term strategy, for example to
improve your
pension
.
Private retirement provision with ETFs: The earlier the investment, the higher the return on retirement
With an investment period of 15 years, investors have never
lost
money
with this model
.
This emerges from calculations by the “finanztip.de” portal.
A prerequisite for this calculation, however, is an investment in a global equity index fund such as
MSCI World
.
This covers, for example, the price developments of a good 1,600 stocks from 23 industrialized countries.
ETFs where any dividends are reinvested in the fund's assets are particularly lucrative.
A kind of compound interest effect occurs over the term, reports the portal.
The Exchange Trading Funds are therefore ideally suited for building up assets over the long term.
With regard to private
old-age provision, the
following applies: the earlier you invest, the higher the savings when you
retire
.
Women in particular should start looking at old-age provision at an earlier stage and save money for retirement.
In individual cases, however, investors should always get an overview of the ETF market.
Trading in index funds is booming, so there are many different ways to invest money.
If you don't feel like spending more time buying such index funds, the branch and direct banks are also available.
The investor then only has to
decide
on the
ETF
and the amount of the investment.
The
bank
takes care of everything
else
.
(Yannick Wenig)
* fr.de is an offer from IPPEN.MEDIA.
