The Altersvorsorgedepot from 2027, in plain English

What it is

The Altersvorsorgedepot is a special investment account for retirement. It replaces the Riester pension. You choose ETFs or funds, pay in regularly, and the state adds an allowance (Zulage) every year.

While you save, gains are not taxed. You pay tax only when the money is paid out in retirement. There is no guarantee on the money you pay in: like any ETF investment, the value goes up and down.

Each adult needs an own contract. A married couple does not share one.

A partner who is not eligible alone (for example, not working) can still get a basic allowance through the working partner. That partner must pay in at least 120 € a year and gets at most 175 €, according to the Finance Ministry.

You do not have to pay monthly. The allowance for the whole year is also paid if you pay in once, even in December.

Who can get it

• Employees and trainees who pay into the German state pension. This includes Blue Card holders with a normal job contract.
• Self-employed people with business or freelance income who have filed a tax return. This is new: under Riester most self-employed people were left out.
• Members of a professional pension fund (Versorgungswerk), such as doctors, lawyers and architects, if they give their consent to the fund.
• Civil servants, judges and soldiers.
• Mini-jobbers who have not opted out of pension insurance.
• Parents during the three child-raising years, and people receiving unemployment or sickness benefit after a job with pension insurance.
• Husbands, wives and registered partners of someone on this list, with the smaller 175 € allowance.

Not eligible on their own: people who pay voluntary contributions to the state pension and fit no group above, mini-jobbers who opted out, and people who already draw a full old-age pension.

What expats should check

• Your passport does not matter. What counts is your status in Germany: a job with pension insurance, or self-employment with a tax return.
• Retiring inside the EU or EEA is fine. You keep the allowances.
• Retiring outside the EU or EEA costs you the state money. If you live outside the EU or EEA when the payout starts, you must pay back the allowances and tax savings you received. This also applies if a tax treaty treats you as resident outside the EU or EEA. Your own contributions and gains stay yours.
• Leaving Germany before retirement: the Finance Ministry's FAQ only describes the payout phase. Under the Riester rules so far, moving outside the EU or EEA and losing eligibility also triggers the payback, which can be postponed on request. Ask a tax adviser how the new law treats your case before you sign.
• If you may move back to India, the USA or another non-EU country, compare with a normal ETF depot. It has no state money, but you can sell or move at any time.
• US citizens and green-card holders: European ETFs count as PFICs under US law. That problem does not go away inside this depot. Get cross-border tax advice first.

How the tax works

• While you save: no tax on gains or dividends inside the depot. No Vorabpauschale.
• In your tax return: enter your contributions. The tax office checks whether a tax deduction is worth more than your allowances and refunds the difference. Higher earners often get more this way.
• In retirement: the whole payout from subsidised money (contributions, allowances and gains) is taxed at your personal income-tax rate. For most people that rate is lower in retirement than while working.
• Health insurance: the Finance Ministry says payouts from private contracts are free of health and care contributions for people with compulsory statutory health insurance.

Getting the money out

• Payout starts between age 65 and 70. Earlier is possible only if you already draw a state pension.
• You choose a lifelong pension, or a payout plan that runs at least until age 85.
• You may take up to 30% as one lump sum at the start.
• You may take money out earlier to buy or pay off a home you live in.
• Any other early withdrawal means paying back the allowances and tax savings.
• With a payout plan, money not yet paid out can be inherited. A husband or wife can take it over into an own contract without loss. Other heirs must pay back the state support.

Three kinds of contract

• Standard depot: the simple choice. Two funds chosen by the provider, an automatic shift to the safer fund before retirement, and yearly costs capped by law at 1.0%. Every provider must offer one.
• Free depot: you pick the ETFs or funds yourself from the allowed list. No cost cap.
• Guarantee product: 80% or 100% of what you paid in is guaranteed at retirement. Safer, with lower expected returns.

Announced, prices not yet published: ING (waiting list), comdirect (registration), DKB, Consorsbank, Trade Republic, finanzen.net zero, Raisin, Trading 212, Whitebox, Allianz, Commerzbank, Targobank and others. A public standard depot run for the state is also planned, with no details yet.

How to choose a provider

• Yearly cost after the opening offer ends. You may save for 30 years; a free first year matters little.
• Which ETFs you can pick. Look for a broad world index.
• Costs in the payout phase. Most providers have not said yet.
• An English app and support, if you need them.
• Automatic allowance application. The provider should request the state money for you.

Switching later is possible. After five years your old provider must let you go for free, and the new one may charge at most 150 €.

There is no rush. Stiftung Warentest points out that the full 2027 allowance is paid even if you open and pay in in December 2027. Waiting for certified products and final prices costs you nothing.

Altersvorsorgedepot or a normal ETF depot?

• Altersvorsorgedepot: state money on top, no tax while saving, but locked until 65 and the whole payout is taxed as income.
• Normal ETF depot: no state money, but you can sell any time, and profits on equity ETFs are taxed at about 18.5% after your 1,000 € allowance.

Many people will use both: 150 € a month here for the full allowance, and the rest in a normal savings plan that stays flexible.

If you already have a Riester contract

• You can keep it with the old rules. Contracts signed before 1 January 2027 are protected.
• You can move it into a new contract without paying back past support. Switching can cost fees.
• You can keep the contract and only switch to the new allowance rules by telling your provider.
• Parents with low income and several children can be better off under the old rules. Calculate before you switch.

What to do now

1. Check that you are in an eligible group.
2. Decide how likely it is that you retire outside the EU or EEA.
3. Pick your amount: 10 € a month as the minimum, 150 € a month for the full basic allowance.
4. Wait for certified products and final prices, then compare yearly costs.
5. Open the contract in 2027 and enter your contributions in your tax return.

Sources

• Federal Ministry of Finance: questions and answers on the pension reform
• Stiftung Warentest: the Altersvorsorgedepot and the Riester reform
• Stiftung Warentest: Scalable Capital publishes its conditions
• finanzfacts: provider comparison, status 9 October 2026

This page is general education, not personal tax or investment advice. The rules are new and details can still change. For your own case, especially if you may leave Germany, speak to a tax adviser (Steuerberater).