Few months ago, I set up this savings plan with wustenrot. I think my workplace also gives some money if I save this amount for housing but I am not entirely sure.
I intially set up a plan to save 100 euros per month. Few days ago, I received this letter. Frankly speaking, I do not understand what does it mean or why I should send 2200 hundred more. I did not have a savings plan and it seemed like a decent idea initially through wustenrot. But can any one explain what is the benefit of this type of savings plan and why/why not sending 2200 euro be a good idea? Or should I invest in some thing else, like etf?
How many days I have to send it? End of this year?

by happyvoxod

5 comments

  1. You can ask on r/finanzen

    In principle Bausparer are very conservative, safe, but low interest. There are some subsidies from the state for it though.

  2. Like the other comment are said ask on r/finanzen. 

    And for the future, do not sign anything that you do not fully understand. 
    Afaik you pay an acquisition fee for “booking” the saving plan and the “Variantenpreis” is an additional fee for your saving plan. To be fully sure you should ask the Wüstenrot consultant. Canceling your savings plan could be somewhat difficult depending on your contract with them. Good luck! 

  3. I just want to mention, Bausparen is fucking dumb. Especially I don’t recommend you Wüstenrot, they have tricked/scammed me before, so fuck that company.

    If you can still stop the contract, I’d do so.

  4. One of the most important rules of finance for beginners is probably to only invest in products you really understand. Probably worth to read into the finance in Germany matter, your contract details and then decide to invest into something you understand and that meets your requirements. Some people say a little safety buffer on a Tagesgeld account and a simple long term savings plan on a globally investing ETF is one possible simple beginner strategy.

    Without knowing all terms and conditions of your contract it seems you need to transfer more money over to fulfill the conditions of the contract. Might as well needs a certain initial amount to be actually effective (ie. get the state tax benefits). They did not set you a hard deadline yet, so that might follow in a future mail. Currently its just a friendly reminder.

  5. How did you sign up to such a financial measure which you do not understand at all? Please do not do this in the future.

    In general a Bausparplan is a kind of deferred credit. You pay in money for some time until a sufficient amount is reached and a specified time has passed. Then you can request a payout to build a house (and to nothing else). For payout, the Bausparkasse (a kind of bank that makes these contacts) pays back your savings and also gives you a credit of similar size that you then have to save back as well. The main benefit of this arrangement is that you could get relatively moderate interest rates on the credit which are fixed at the time of signing the initial contract. However the whole thing is incredible inflexible and there are plenty of gaps the bank can trick you. Also there is an broker fee (Abschlussgebühr) attached and the conditions are usually quite poor. I personally would never buy such a thing.

    The reason why you probably got it is to get this extra money from your employer known as “Vermögenswirksame Leistungen”. This is an extra part of you salary, you employer could give you and which is preferably taxed. However you cannot get in cash and only in a savings plan, which could a Bausparplan or something more modern. It should probably not be much larger than 50 € and more likely like 20€ per months

    You probably have to pay the broker fee which could easily be around 2000€. This is the salary for the guy who sold you that thing. I don’t know what that option component is they refer to.

    As for the savings plan itself. You should check the conditions carefully, with someone that speaks German. They might be ok, but they may easily be so poor that it might be better of to terminate the contract after the 1 year or permaturely terminate savings even though you already paid the broker fee (In particular given that. Maybe you are early enough to return the whole polacy and get also the broker fee back, but I doubt that.

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