Who can invest in a fixed deposit

Investment and retirement provision: this is the best way to invest your savings!

This is how much cheaper ETFs are compared to other products

You have to pay five to ten times as much fees for many common investments and retirement plans as for ETFs on the MSCI World index fund or the FTSE All World. The difference is not always easy to see because the providers use the most varied of reference values ​​for different charges.

A comparison of the typical costs associated with various forms of investment and where you can find this information can be found here:

Pension / life insurance

  • up to 7.9% of the contribution amount for acquisition costs (one-off)
  • up to 2.3% of the contribution amount for administrative expenses (annually)
  • as well as very different and different types of costs depending on the provider
  • to be found in the annual status notification, product information sheet

Stock mutual funds

  • 5% issue surcharge on savings contributions (one-off)
  • 1.5% of the capital (annually)
  • as well as considerable transaction costs with a very active investment strategy, random "performance fees"
  • can be found in the key investor information

Asset management

  • no one-time costs
  • approx. 1% of the capital, possibly further capital investment costs (annually)
  • as well as random "performance fees", transaction costs
  • to be found in the asset management contract

ETF index funds on MSCI World or FTSE All World

  • 1.5% order commission of the savings contributions (one-time)
  • 0.2% of the capital (annually)
  • as well as transaction costs (to a very small extent)
  • to be found in the price list of the custodian bank and in the key investor information

Single stocks and fund policies are not good alternatives

Investing in individual stocks, on the other hand, is not a good idea. Experience has shown that a few individual stocks from just one or a few countries and industries are significantly more risky than globally diversified equity funds.

Unit-linked annuity insurance, also called fund policy, is usually out of the question due to the high acquisition and running costs. Insurance companies are now increasingly offering index policies. But these have nothing in common with index funds. In most cases, the investor is promised a certain degree of security together with the prospect of participating in the performance of one or more indices, although it does not have to be just stock indices.

But more security always means less opportunity for returns - No investment strategy, however sophisticated, can override this mechanism. Because of their high costs, index policies are significantly inferior to a mix of fixed-term deposits and equity ETFs over the long term. The same applies to most of the so-called mixed funds.

If you have already concluded such contracts, you should check on a case-by-case basis whether it makes sense to continue such contracts, to make them non-contributory or to terminate them. If you are unsure, let us advise you.

How much risk can it be?

If you decide to invest your savings for the long term, the question also arises of how best to divide them up among the various types of investment: How much should be invested relatively safely, but with low interest rates? And what part can be invested in more profitable, but also in the short and medium term riskier, more volatile investments?


The following example shows this:

We assume that in addition to your reserve for contingencies, you have a fortune of 50,000 euros that you will most likely not have to attack in the next ten years. Can these 50,000 euros be less due to fluctuations in value, if there is a chance that these losses will be balanced again over a period of ten to twenty years and often a greater profit will be made?

Let's assume you can tolerate the 50,000 euros turning into 35,000 euros in between. That would be a decrease of 30%.

Then you could invest 60% of your money in stocks, i.e. 30,000 euros, while the remaining 20,000 euros come into a call money or fixed-term deposit account without any risk of fluctuations in value.

Why 60%? Because the maximum risk of loss in stocks has historically been around 50%. Historically, the amount of 30,000 euros was reduced to 15,000 euros in the worst case, for example after a stock market crash. Together with the 20,000 euros in the secure fixed-term deposit, you would have at least the desired 35,000 euros even after the crash.


Depending on the maximum amount of interim loss of your money you can and want to cope with, the following share in shares can come into question (assuming a worldwide diversification!):

maximum manageable loss of the invested moneyProportion of your money that could be invested in a global stock index
10%20%
20%40%
30%60%
40%80%
50% and more100%

If you do not have to invest money once, but want to invest 100 euros month after month for long-term savings purposes, for example, you can proceed in the same way: If you are willing to tolerate interim losses of 30%, you can save up to 60% of the savings rate in Invest equity funds.

Notice these are Rules of thumb that have proven themselves in the past, especially in crises and crashes. A warrantyThere is no such thing as that that always has to work out that way.