The decumulation phase in the Altersvorsorgedepot (Germany's state-subsidized retirement investment account)

This is how to make the most of your assets in retirement.

Overview

Built up well, withdraw wisely

Many people focus only on building up assets. Yet the decumulation phase also determines how much of your savings actually reaches you in the end. The best return is of little use if the capital is not deployed wisely in retirement. And this phase often lasts longer than expected, frequently twenty to thirty years, during which your assets have to last and still leave you room to maneuver.

The Altersvorsorgedepot can be adapted flexibly to your circumstances, and the remaining capital stays invested in the capital market. Whether a lifelong pension or a flexible drawdown plan: you decide how you withdraw.

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Principles

What matters in the decumulation phase

Do not withdraw everything at once

Your securities account can keep generating returns in retirement too. Withdrawing step by step is often the better choice.

Combine flexibility and security

A combination of a drawdown plan and a partial lump-sum withdrawal (max. 30% of the accumulated capital at the start of the decumulation phase) secures income and keeps you flexible.

Stay invested

Retirement often lasts 20 to 30 years. An appropriate equity/ETF share offsets inflation.

Plan withdrawals realistically

Withdrawals that are too high use up your assets too early. The rate should match your assets and your life expectancy.

Factor in taxes and succession

Take tax effects, inheritance and provision for family members into account early on.

Plan for a liquidity buffer

A reserve for larger or unexpected expenses keeps you from having to sell shares during weak market phases.
Transition

What happens when you retire?

When the decumulation phase begins, the assets built up during the accumulation phase are used step by step to finance your retirement.

Accumulation phase → Altersvorsorgedepot → Start of retirement → One-off withdrawal / ongoing withdrawals

Options

What payout options are there?

According to the Federal Ministry of Finance (reform of subsidized private retirement provision), you can choose between two options at the start of the decumulation phase. It is an either-or choice. A combination of the two forms (annuitizing part of the capital and taking the rest as a drawdown plan) is not provided for in the official reform. Nor is a free partial lump-sum withdrawal available as a separate payout option – up to 30% of the accumulated capital can, however, be withdrawn as a one-off payment at the start of the decumulation phase.

  • Lifelong life annuity (annuitization)
    The assets are converted into a fixed monthly pension for the rest of your life, regardless of age.
  • Fixed-term drawdown plan
    Runs at least until the end of your 85th year of life (a longer plan is possible). The capital stays in the securities account and is withdrawn step by step; assets not yet paid out can be inherited. Once the plan ends, the assets are used up.
Withdrawal calculator

What your securities account can deliver in retirement

How much you can withdraw each month and how long your assets will last depends on your capital and the size of your withdrawals. Set both in the calculator and see the result immediately. As a guide: at around 3 to 4% withdrawal per year, your assets are usually preserved across a long retirement.

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Wie viel können Sie entnehmen?

Depotvermögen iIhr angespartes Vermögen bei Rentenbeginn. Beispielwerte: 250.000 €, 500.000 €, 1.000.000 €. 500.000 €
50.000 €2.000.000 €
Entnahmerate pro Jahr iFaustregel: 4 % p.a. ist nachhaltige Entnahme bei breit gestreutem Aktien-Anleihe-Mix (Trinity-Studie). Konservativer: 3 %. Aggressiver: 5 %. 4,0 %
1 %8 %
Monatliche Entnahme
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vor Steuern
Reicht für
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ohne weitere Rendite
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Erweiterte Berechnung Mit Einkommen, Rendite, Kosten, Inflation, Riester-Übertrag, ETF-Vergleich Auf die Warteliste Erfahren Sie als Erste:r, welche Anbieter starten

Unverbindliche Modellrechnung, keine Anlageberatung, keine Garantie künftiger Wertentwicklung. Vergangene Wertentwicklungen sind kein verlässlicher Indikator für künftige Wertentwicklungen.

How the securities account develops during the decumulation phase

An example with €500,000 of starting capital, a 4% withdrawal (€20,000 per year) and a 5% average return. Because the return is slightly higher than the withdrawal, the account not only stays stable but can even keep growing over the years.

€500,000 approx. €830,000 Start of retirement after 30 years

Model calculation: €500,000 at the start, 4% withdrawal (€20,000/year), 5% return p. a. No guarantee. With higher withdrawals or weaker returns, assets can decline.

Comparison

Annuitization or drawdown plan?

Both routes have their strengths. These points help with the decision:

Annuitization if …

  • planning certainty matters most to you
  • you want a guaranteed income for the rest of your life
  • you do not want to manage your investments actively
  • you want to avoid your assets being used up in old age

Drawdown plan if …

  • you want flexible access to your money
  • you want to pass on remaining assets
  • you want to keep benefiting from capital market returns
  • you want to take an active part in planning your assets
Succession

Passing on assets

An important difference from many traditional pension insurance policies is that unused assets are generally preserved. Anyone who dies early or deliberately withdraws less therefore does not lose the accumulated capital to the pool of insured members, but can pass it on to family members.

The assets remain your property at all times, and you can see transparently how high the current account value is. Succession can be arranged flexibly, for example in favor of a spouse or children. This makes the Altersvorsorgedepot not only a way of providing for yourself, but also a building block for passing on wealth.

How much can be passed on in the end depends above all on how much is withdrawn in retirement. With moderate withdrawals, a substantial part of the capital is often preserved over the years:

Starting assets remaining after 10 years
€500,000 approx. €400,000
€750,000 approx. €620,000
€1,000,000 approx. €830,000
Example values with moderate withdrawals; actual development depends on the size of the withdrawals and on returns.
Tax

Taxes in retirement

The Altersvorsorgedepot follows the principle of deferred taxation: during the accumulation phase, returns stay invested tax-free; tax is only due on payout, and then at your personal tax rate.

That is often favorable, because many people have lower taxable income in retirement than during their working life. The later tax burden is therefore frequently lower.

Weighing it up

Opportunities and risks

Opportunities

  • Flexible withdrawal strategies
  • Capital can stay invested
  • Can be inherited
  • Inflation protection through the equity share

Risks

  • Withdrawals that are too high use up your assets
  • Market fluctuations during the withdrawal period
  • Inflation
  • A longer life expectancy than planned
FAQ

Frequently asked questions

In the Altersvorsorgedepot, the capital is generally tied up until retirement begins – that is the price for deferred taxation and the allowances. Early withdrawals are only possible to a limited extent and can mean that you have to repay the subsidy. If you expect to need the money sooner, a non-subsidized securities account is the better choice for that.

With the life annuity your account assets are converted into a lifelong monthly pension in retirement. The amount is based on the annuity factor and is guaranteed for the rest of your life, regardless of how old you become.

With the drawdown plan to age 85 your money stays in the securities account and is paid out evenly until age 85. That is more flexible than the life annuity, and the rest stays invested and can be inherited.

Yes. What applies here is deferred taxation. During the accumulation phase, returns stay tax-free; tax is only due on payout, at your personal tax rate. In retirement that is often lower than during your working life.

A free partial lump-sum withdrawal is not provided for in subsidized retirement provision. At the start of the decumulation phase, however, up to 30% of the accumulated capital can be withdrawn as a one-off payment.

As a rule of thumb, around 3 to 4% per year is considered sustainable. How much that comes to with your own assets is shown by the advanced calculator.