Key Information and Tips on Financial Planning

Key Information and Tips on Financial Planning

Our guide gives you a whole host of tips, information, as well as answers to key questions on all aspects of financial planning.

Financial planning is planning for life. Make sure you make the right decisions for all situations with the help of a carefully thought-out plan. Here you will find key tips on personal financial planning:

Age 20 or over

  • Check your pension situation regularly. What may seem far off can be here before you know it.
  • Find out how your pension entitlement is made up of a first, second, and third pillar.
  • Pay into your 3rd pillar private pension regularly, and up to the annual maximum amount – e.g. with a 3rd pillar standing order.
  • Check that your 3rd pillar pension solution matches your risk tolerance and risk capacity. Saving for retirement using securities is an attractive alternative to saving with a traditional 3a pension account. It makes particular sense on a long-term investment horizon.
  • Open several 3rd pillar pension accounts in order to stagger the creation of your private pension – meaning you pay less tax when the pension is paid out.

Age 30 or over

  • Imagine how your personal situation could change over the coming years.
  • Read your annual pension fund statement and discuss any questions with HR, an expert, or do some research online.
  • Carefully check your voluntary purchases of pension benefits, and consult an expert if necessary. Fact is, after paying in you have to wait three years in order to withdraw capital from the 2nd pillar – for example in order to purchase your own home.
  • If you are buying your own home, find out about the possibility of an advance withdrawal or the pledging of your 3rd pillar pension account balance.
  • If you are getting married or starting a family, consider how the new situation will impact your finances.
  • Make sure you are insured against disability and inability to work, and protect your loved ones against potential risks.

Age 50 or over

  • At age 50 or over you need to take a concrete look at all aspects of your retirement.
  • Get an overview of how much your pension will be. Watch out: Early retirement is generally a very expensive affair, and needs to be planned in advance.
  • Draw up a budget: How will your income and expenses look before and after retirement?
  • Think about any plans or dreams you may have over and above your normal budget (round-the-world trip, vacation home, etc.), and what they will cost.
  • Plan the withdrawal of your Pillar 3a balance in order to benefit from maximum tax advantages.

Age 70 or over

  • Make sure you have signed an advance directive, so that even if you lose your decision-making capacity you will still be taken care of in the way you would like.
  • Tell the relevant authorities and family members about where you have stored your advance directive, to make sure it is available should the worst come to the worst.
  • Find out whether it makes sense to make any donations or gifts of assets or other items during your lifetime.
  • Talk openly with your beneficiaries about donations, lifetime gifts or loans, to make sure the matter is transparent for all those involved.
  • Draw up your will, to make sure everything is decided the way you would like should the worst happen and your assets are passed on in the way you have planned.
  • Think about tax aspects in your inheritance planning.

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