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Default standard product: the low-cost basic account in the Altersvorsorgedepot

June 30, 2026 Comments Off on Default standard product: the low-cost basic account in the Altersvorsorgedepot

The default standard product is a basic offering prescribed by lawthat every provider of an Altersvorsorgedepot (Germany’s state-subsidized retirement investment account) is obliged to offer. It is especially simple, transparent and capped in its costs, at a maximum of 1% reduction in yield (RIY) per year.

Table of contents

  1. What is the default standard product?
  2. Who offers it?
  3. How does it work?
  4. How high are the costs?
  5. When is the default standard product worth it?
  6. Why did the legislator introduce it?
  7. Frequently asked questions

What is the default standard product?

A legally defined minimum variant of the Altersvorsorgedepot that every provider is obliged to offer, either itself or through a partnership. It has fixed cornerstones for investment strategy, costs and process so that consumers can compare offers easily.

Who offers the default standard product?

All providers certified by the Federal Central Tax Office: banks, direct banks, Sparkassen, cooperative banks, neobrokers, fund companies and insurers. They may also offer more expensive premium variants alongside it, but the default standard product is mandatory.

What exactly is the default standard product?
The default standard product is the solid basic choice with a cost guarantee. Mandatory for every provider.

How does the default standard product work?

The default standard product relies on a preset, low-cost investment strategy. In practice that usually means:

  • A broadly diversified global ETF (e.g. MSCI World or FTSE All-World).
  • Automatic rebalancing.
  • Lifecycle model: a high equity allocation in your younger years, shifting gradually into more defensive investments before retirement begins (optional).
  • Standard decumulation phase: usually drawdown plan to age 85 as the default.

How high are the costs?

The Reduction in yield may not exceed 1% p.a. Included are:

  • Securities account fees
  • Fund costs (TER of the ETFs / funds held)
  • Front-end loads / transaction costs
  • Administration costs in the decumulation phase

Providers are allowed to stay below that figure, however. Some pure ETF default standard products are expected to be available for 0.3–0.6% p.a.

When is the default standard product worth it?

For beginners, for those who want an easy life and for anyone who wants the lowest possible costs without going deeply into securities. If you prefer to pick your own ETFs and strategies, you should consider a premium product or a self-select securities account.

Why did the legislator introduce the default standard product?

Riester had a problem with high acquisition and administration costs. The default standard product provides a cost-capped entry pointthat premium providers also have to measure up to. It is therefore a protective instrument for consumers and a political answer to years of criticism from consumer advocates.

Who benefits from the default standard product?

Sarah, 30, a beginner with no experience of securities. She chooses a direct bank’s default standard product with a 0.4% reduction in yield and an MSCI World ETF. She saves €150/month. Effort: one savings plan, set up once. Over 30 years around €180,000 final balance at a 6% return.

Marc, 50, wants a premium selection. He chooses the premium product instead, with 50+ ETFs to pick from freely. Higher costs (0.9%), but an individual strategy.

Frequently asked questions about the default standard product

Is the default standard product always the best offer?

Not necessarily. Good premium products can score with active management or specialist ETFs, but they are usually more expensive. For pure ETF investors the default standard product is often the cheapest choice.

Can I choose the ETFs myself in the default standard product?

Only to a limited extent. Providers may set a list. If you want a free choice, you typically need the same provider’s premium product.

What happens to the default standard product when I switch providers?

The balance is transferred. The new provider offers either its own default standard product or an equivalent premium product to choose from.

Can I switch between the standard and the premium product?

With the same provider that is typically possible, and when switching providers it is possible anyway.

Does the default standard product have to be an ETF savings plan?

Not necessarily; providers may also offer active funds or traditional insurance policies as their default standard product, as long as the cost cap and the minimum requirements are met.

Is the contribution guarantee included in the default standard product?

No, the default standard product is specifically allowed to do without a guarantee, in order to make a full equity allocation possible.

Who is it best suited to?
For self-directed investors with ETF knowledge it is often the best variant for both return and cost.

Last updated: June 2026.

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