Altersvorsorgedepot: What is already certain – and why you shouldn’t act too hastily just yet

Five points for people with 30 seconds to spare

1. The Riester scheme is coming to an end. From 1 January 2027, no new Riester contracts will be issued; the Altersvorsorgedepot will take over. The law has been passed.
2. The state subsidy is simple and substantial. 50 cents from the state for every euro on the first 30 euros of your monthly contribution, up to 540 euros in basic allowance per year, 300 euros per child on top of that, and a 200-euro bonus for everyone under 25.
3. The self-employed and pension schemes are finally included. Freelancers, business owners, doctors, solicitors, architects. Around four million more people are now eligible for the scheme for the first time.
4. No more obligation to guarantee returns. Your money can genuinely be invested in funds and ETFs.
5. Do you already have a Riester pension plan? Existing rights are protected; there’s no rush. Switching is a one-way street and may even reduce your state contribution. Do the maths first, then decide.

The long version, to enjoy over one or two cups of coffee.

Why shouldn’t you act too hastily? Because, quite simply, there aren’t any products available yet. However, the usual suspects are already collecting addresses, advertising with bonuses and would ideally have you make that fateful click today, without providing any factual information, and transfer funds to them. This has nothing to do with advice. It is exploiting a trend, and I consider it irresponsible.

There’s no need to panic. You’ve got all the time in the world. Let’s make the most of it and get to grips with the issue. What’s actually certain, what’s still up in the air, and where is it worth giving some thought right now?

What has been decided

The law has been passed. The Bundestag approved the reform in March 2026, and the Bundesrat gave its consent in May. This marks the end of the Riester scheme for new contracts. Anyone wishing to take out a new policy can only do so until December 2026; the Altersvorsorgedepot will come into effect on 1 January 2027.

Behind this lie three product pathways, and they differ more than the advertising will later admit.

The standard product is deliberately simple. A maximum of two funds, a reduction in yield of no more than 1.0 per cent per annum, and no guarantee (such guarantees are not even permitted there). Any provider wishing to offer other options must also offer this one.

The investment account solution offers complete freedom. A wide selection of ETFs and funds, or a savings plan managed by a discretionary management firm, with no set fees; guarantees are available through the fund company.

The unit-linked policy is the route via the insurer. Well-known plans with a wide selection of funds, optionally without a guarantee or with an 80 or 100 per cent premium guarantee, with no cap on fees.

The contribution guarantee is therefore no longer compulsory. Those who want it can opt for it in their policy or investment account; those who do not need it can let their money work without any restrictions. It is precisely this restriction that has cost many Riester schemes their returns. The 100 per cent guarantee forced the money into low-yield securities or only partially successful guarantee models.

One detail that I personally particularly like is that acquisition costs may no longer be deducted from the initial premiums; instead, they are spread over the entire term of the policy. There is no zillmerisation, meaning there is no contract that works solely for the intermediary’s benefit in the early years.

Payments are also regulated. From the age of 65 at the earliest, up to 30 per cent can be paid out in a lump sum, with the remainder paid out either as a payment plan until at least the age of 85 or as a lifetime annuity.

The subsidy, once worked out

The new system is delightfully simple. For every euro you pay in, the state adds a little extra:

• You receive 50 per cent on the first 30 euros per month. You pay 360 euros a year, and the government adds 180 euros.
• From the 31st to the 150th euro per month, there is a 25 per cent contribution. Anyone who saves the full 1,800 euros a year receives a total basic allowance of 540 euros. (50 per cent on 360 euros plus 25 per cent on 1,440 euros.)
• An additional 300 euros per child per year is added. The full child allowance is available from a monthly contribution of just 25 euros. At this point, the state contributes exactly the same amount as you do. And unlike with the Riester scheme, the rate applies uniformly to every child eligible for child benefit; the old sliding scale, under which children born before 2008 received only 185 euros, has been abolished.

One aspect makes the scheme even better than its predecessor. The government allowances are paid on top and are not offset against your own contribution, as is the case with the Riester scheme. Two minor points worth noting. To qualify for the government allowance, you must pay in at least 120 euros a year, which is 10 euros a month. And anyone who takes out a policy before their 25th birthday receives a one-off ‘career starter bonus’ of 200 euros.

Then there’s tax, the second key feature of this product. You can claim your contributions of up to 1,800 euros a year, plus any government allowances, as special expenses. As part of the ‘favourable treatment test’, the tax office calculates whether the government allowance or the tax benefit is more advantageous for you, and credits you with the difference. For those on higher incomes, this tax benefit is often greater than the government allowance itself. In return, the pension is taxed later, i.e. at your retirement tax rate, which is often lower than it is today.

Anyone wishing to save more can make additional unsubsidised contributions of up to 6,840 euros per year. This portion operates like a third-pillar product. Returns remain tax-free during the savings phase, switching funds does not trigger any flat-rate withholding tax, and the return component is taxed upon retirement.

Added to this is the ‘Frühstart-Rente’ (early retirement pension), a separate scheme that is often confused with the child allowance. From 2027, the state will automatically pay 10 euros a month into a separate investment account for children aged between 6 and 18, though only for those born in 2020 or later. Parents and grandparents are allowed to make additional contributions.

Self-employed people are finally included too

For two decades, the self-employed and business owners were excluded from the Riester scheme; at best, they could participate indirectly via their spouse. The legislature has learnt from this. For the first time, the self-employed, freelancers and business owners are eligible in their own right for state contributions in the Altersvorsorgedepot, as are members of professional pension schemes, that is, doctors, dentists, solicitors and architects. Around four million people who previously had to sit on the sidelines.

The full list of those directly eligible for benefits is as follows. Those compulsorily insured under statutory pension insurance (employees and apprentices); members of professional pension schemes; civil servants, judges and soldiers; farmers and foresters covered by the farmers’ pension scheme; and traders and the self-employed with income from business operations or self-employment.

Not directly covered are pensioners, students, those not in gainful employment and, this is the pitfall for many of my clients, managing directors of a GmbH who are exempt from social security contributions. A managing director receives a salary, not income from business operations or self-employment, and this is precisely the criterion on which the legislator bases eligibility for the scheme. For this group, the indirect route remains. If your spouse or registered partner is directly eligible for the scheme and you both have your own contracts, you will also receive the government allowances.

This means that state-subsidised retirement provision is now, for the first time, worthwhile for the self-employed too, and in a product that is consistently investment-oriented rather than constrained by guarantees. If you’re self-employed and had, quite rightly, written off the idea of state subsidies until now, then you’re now in with a chance too. Let’s have a chat.

Do you already have a Riester pension scheme?
Read this section twice.

First, the good news. Your existing policy is protected by statutory grandfathering provisions. Nobody is cancelling anything for you, nobody is converting anything, and your savings will stay where they are. There is no deadline to rush you.

Here are the three options available to you. You can switch your pension scheme (your policy will remain in place with all its guarantees and terms and conditions, but will receive the new, often higher government allowances). You can transfer your capital into an Altersvorsorgedepot (a new contract, with new opportunities but without your old guarantees, and the transfer may take several months). Or you can leave the Riester contract dormant and make additional contributions to the new investment account from 2027 onwards.

The switch is a one-way street. Once you’ve switched, there’s no going back to the Riester subsidy. In some circumstances, the subsidy may even decrease as a result of the switch. Take, for example, a parent who currently receives basic and child allowances based on the base amount of 60 euros a year. Under the new system, this requires a personal contribution of 300 euros a year. Anyone who simply switches without adjusting their contribution will end up receiving less from the state than before.

That is precisely why the advertising for insurance premiums worries me. It’s all too easy to click on an online provider’s link. Whether it suits your policy, your cover and your family situation is another matter entirely, and once you’ve signed up, there’s no going back.

What, to be honest, nobody can say yet

The specific products are not expected to be available until this autumn. Nobody knows the costs at present. Nobody knows the terms and conditions of the payout products. Nobody can make a reliable comparison, not even me. Anyone who wants to sell you ‘the best Altersvorsorgedepot’ right now is selling you something they cannot possibly know about.

My advice is therefore not an either/or situation. No knee-jerk reactions, but no shying away either. The funding logic is clear, you know your figures, and whether it’s worth your while to wait, switch or transfer can already be calculated accurately today.

Do you want to put your Riester pension plan on the table or find out whether the investment account fits into your system? Then book an appointment before you click anywhere.