Minimum own contribution: €120 a year keeps the subsidy alive

What is the minimum own contribution?

The state only pays in if you contribute something yourself. The lower limit for this is €120 per calendar year. If you pay in less, you get nothing at all for that year, not even a pro-rata allowance.

The amount is also called the minimum base contribution. It applies per person and per year, not per contract, and it is deliberately set low. What counts is what has arrived in the securities account by 31 December, not when you transferred it.

The three thresholds at a glance

Three amounts are regularly confused because they trigger different things.

Between €120 and €1,800 the basic allowance rises in stages. On the first €360 there is 50 percent, on everything above that up to €1,800 a further 25 percent.

The table shows an effect that hardly any provider explains on its own. The first €360 is by far the most profitable money in the entire contract. If you have little to spare, that is exactly where to start, rather than not starting at all.

The difference from Riester

The Riester pension had an income-based minimum own contribution. If you did not pay in four percent of your previous year’s gross income, your allowance was cut pro rata. For higher earners that meant constant recalculation, and because the cut happened without any notice or notification, in countless cases it only came to light when someone laid the annual statements side by side years later.

This rule does not exist in the Altersvorsorgedepot (Germany’s state-subsidized retirement investment account). €1,800 leads to the full basic allowance, regardless of whether you earn €30,000 or €130,000. That is one of the few genuine simplifications in the reform, and it removes one of the most common sources of error in the old system.

What applies with a fluctuating income

The calculation is per calendar year. A strong year does not make up for a weak one, and if you pause in 2029 you cannot make up for it in 2030. For Self-employed with irregular income this is the single most important rule of all.

The practical route is a small standing order as a base load plus a one-off payment in December, when you can see how the year has gone. That way you never fall below the lower limit and still keep room to go higher.

Three examples