Subsidy, tax relief and return

Why the Altersvorsorgedepot delivers more than capital market returns alone.

Introduction

More than just what you pay in

With the Altersvorsorgedepot it is not only your own contribution that counts. The state adds substantially through allowances and tax relief. Every subsidized euro lands straight in the account and earns returns of its own — almost like an extra return on your contribution, and that before the capital market has done anything at all. In concrete terms that is up to €540 basic allowance per person and €300 per child, year after year.

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Own contribution

Your regular contribution. You decide how much goes into the account each month.

Government support

Allowances from the state that go straight into the account and grow with it from day one.

Capital market return

Returns from broadly diversified ETFs and funds, the biggest lever over the years.
Allowances

The subsidy at a glance

The state supports wealth accumulation with direct payments. The key amounts at a glance:

 
Subsidy component Amount
Basic allowance per eligible person €540 / year
Child allowance per child €300 / year
Maximum subsidized contribution €1,800 / year
Additional contributions (unsubsidized) up to €5,040 / year
Maximum total contribution €6,840 / year

How much this adds up to depends on your household situation.

Leverage

Why the subsidy works like an extra return

The clever part is the timing. Because the allowance lands in the account in the very first year, it has just as long to grow as your own contribution. The earlier you start, the larger that subsidized share becomes in the end.

Own contribution → Subsidy → more capital invested → more return → higher final balance

Worked example

How the subsidy works in the first year

€1,800

Own contribution

€1,680

Subsidy

€3,480

Total invested

+93%

Return on the subsidy
Capital market return in year 1 (6%): €209 – without the subsidy it would be only €108.

Assumption: one main earner pays in €1,800; the partner receives the full basic allowance via a small minimum base contribution (derived allowance).

Return on the subsidy = allowances relative to your own contribution, before any capital market return.

€1,800

Own contribution

€540

Subsidy

€2,340

Total invested

+30%

Return on the subsidy
Capital market return in year 1 (6%): €140 – without the subsidy it would be €108.

Return on the subsidy = allowances relative to your own contribution, before any capital market return.

€3,600

Own contribution

€1,080

Subsidy

€4,680

Total invested

+30%

Return on the subsidy
Capital market return in year 1 (6%): €281 – without the subsidy it would be €216.

Return on the subsidy = allowances relative to your own contribution, before any capital market return.

How these figures arise (family example)

For the family, the €1,680 subsidy is made up of two basic allowances (2 × €540) and two child allowances (2 × €300) — one main earner pays in, the partner receives the basic allowance via the derived allowance. Subsidy and capital market return together produce around €1,889 of growth in the first year on €1,800 of own contribution — roughly 105%. After just one year, €1,800 has become about €3,689.

Tax

Tax relief at a glance

Alongside the allowances, the Altersvorsorgedepot brings tax advantages that differ by phase.

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During the accumulation phase

  • No ongoing taxation of returns
  • No Vorabpauschale (advance lump-sum taxation)
  • Deferred tax stays invested and strengthens compounding

During the decumulation phase

  • Deferred taxation
  • Your personal tax rate applies
  • Often a lower tax burden in retirement than during working life
Long-term effect

The tax deferral effect

The allowances are obvious. The second advantage is quieter but weighs almost as much over the years: tax. With an ordinary securities account the taxman takes a share of your returns every year, and what goes to the tax office can no longer earn interest.

In the Altersvorsorgedepot that claim is postponed. Your returns stay in the account in full during the accumulation phase and keep working; tax is only due on payout. The longer you save, the more this matters.

  • Ordinary securities account – tax every year
  • Altersvorsorgedepot – tax only in the decumulation phase

Example over 30 years

Two investors each put in €10,000 and earn 6% a year. With the ordinary account, ongoing tax reduces what can be reinvested, leaving an effective return of about 5%. After 30 years it therefore stands at around €43,219, while the Altersvorsorgedepot reaches €57,435 .

+ €14,216

from the deferred tax alone

One percentage point sounds like very little — over three decades it becomes this difference, because the money could keep working undiminished.

Practical tips

What to watch out for

A few simple principles get the most out of the subsidy:

  • First check what contribution you need to make to receive the full subsidy.
  • Start early, so that subsidy and return work together for as long as possible.
  • Leave the subsidy invested over the years instead of withdrawing it early.
  • For higher savings targets, combine the subsidized account with a free ETF account.
Subsidy calculator

How much do I get from the state?

Set whether you are saving alone or as a couple and how many children live in your household. The calculator shows you immediately how much subsidy you can expect per year. Even one child raises the allowance noticeably — and every subsidized euro is invested straight away and grows over the years.

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Ihre mögliche Förderung

Familienstand iSingle bekommt 540 € Grundzulage pro Jahr. Bei verheirateten Paaren erhält jeder eigene 540 € — beide AVD-Verträge zusammen also 1.080 €.
Kinder mit Kindergeldanspruch iPro Kind mit Kindergeldanspruch (bis 25 Jahre) gibt es 300 €/Jahr Kinderzulage. Voll bereits ab 25 €/Mo Eigenbeitrag.
0
Monatlicher Sparbetrag iIhr eigener monatlicher Beitrag. Grundzulage anteilig bis 150 €/Mo (1.800 €/Jahr Höchstbeitrag), Kinderzulage voll ab 25 €/Mo. 100 €/Monat
0 €200 €
Mögliche Förderung pro Jahr
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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.

FAQ

Frequently asked questions

Up to €540 per year goes straight into your account from the state. The full allowance starts at €150 of your own contribution a month; anyone paying in less receives it pro rata.

For every child eligible for child benefit there is another €300 a year via the child allowance , from even a small own contribution. The entitlement ends on the child’s 25th birthday.

Yes. Up to €1,800 a year can be claimed through the special expenses deduction . Whether the allowance or the tax relief works out better for you is normally determined by the tax office.

Yes. Anyone signing up before their 25th birthday receives a one-off €200 through the career starter bonus – on top of the normal allowances.

Through the Frühstartrente the state pays €10 a month into a separate account for children aged 6 to 18. Starting early gives the biggest advantage of all: time.