The Altersvorsorgedepot: what changes for private pensions in Germany from 2027

Launch: 1 January 2027

That's when the law takes effect and the first Altersvorsorgedepot accounts can be opened.

Replaces the Riester pension

No new Riester contracts can be signed from 1 January 2027 onward. Existing contracts keep running unchanged under grandfathering rules.

Up to €540 in subsidies per year

50 cents per euro of your own contribution up to €360, then 25 cents per euro up to €1,800 — a maximum of €540 in state subsidy per year.

A 1.0% annual cost cap

For the standard depot, effective costs are legally capped at a maximum of 1.0% per year. Providers of subsidized depot or guarantee contracts must offer such a standard depot themselves or through a partner.

Now open to the self-employed

Unlike Riester, the self-employed will now qualify for the subsidy too — previously they were largely excluded.

More payout options

Alongside the classic lifelong annuity, a payout plan running at least to age 85 is now possible too; up to 30% can be taken as a lump sum at the start.

Who qualifies

Employees and civil servants qualify for the subsidy, just as they did under Riester. Importantly, the self-employed can now open a subsidized Altersvorsorgedepot too — closing a gap the Riester pension left open.

The subsidy in detail

The state pays a tiered base subsidy: 50 cents per euro of your own contribution for the first €360 per year, then 25 cents per euro up to a contribution of €1,800 — a maximum of €540 in subsidy per year. A minimum own contribution of €120 per year is required. An increase from 2029 that the government draft still contained is not part of the law as passed — the rates apply from 2027.

Cost cap & standard product

Providers of subsidized depot or guarantee contracts must offer a simple standard depot (themselves or through a partner) whose effective costs are legally capped at a maximum of 1.0% per year. That makes offers directly comparable for the first time — a clear departure from the often opaque and more expensive Riester contracts of the past.

How the money is invested

Unlike many classic Riester contracts, the Altersvorsorgedepot invests tax-advantaged in securities such as ETFs or actively managed funds — genuine capital-market investments with real return potential, but also market risk instead of a pure interest guarantee.

Payout in retirement

You can choose between the classic lifelong annuity and a new payout plan that runs at least to age 85 and allows more flexibility around the transition into retirement. Up to 30% of the capital can be taken as a lump sum at the start.

What happens to existing Riester contracts

Existing Riester contracts are grandfathered and continue unchanged — switching is not required. However, no new Riester contracts can be signed from 1 January 2027 onward.

Extra subsidy for families and career starters

On top of the base subsidy, there's a child subsidy of up to €300 per child per year — the full amount kicks in from a €25 monthly contribution — plus a one-time career-starter bonus of €200 for people under 25 when they open their account.

Planned: retroactive from 1 January 2026

The 2020 birth cohort is to go first — children turning six in 2026, with 2026 paid retroactively. Each following year then adds the next cohort.

€10 a month from the state

Parents are to be able to top up the account voluntarily (up to €6,840 a year under the bill) — it isn't required.

Locked until retirement age

Returns are to stay tax-free until payout. The capital is generally to be paid out no earlier than age 65.

Into a pension contract at 18

From adulthood the state stops paying in. The capital is then only to be transferable into a certified retirement contract, such as an Altersvorsorgedepot.

Payout plan or lifelong annuity

The retirement depot allows both. A payout plan (at least to age 85) can pay more per month but ends; the lifelong annuity usually pays less and never runs out. Which one works depends on your other assets and your life expectancy.

The risk of the first retirement years

A market drop shortly after you retire hurts far more than the same drop twenty years later: you withdraw from a depressed portfolio and that capital is gone for good. A cash buffer is what softens exactly this effect.

Withdrawal order

If you hold several pots — subsidised depot, taxable depot, savings account — the order you draw from them affects both your tax bill and how long the capital lasts.

Factor in your state pension

Your state pension covers part of your retirement needs — the rest has to come from your portfolio.

Spotting the shortfall

The calculator compares your projected capital at retirement with what you need for your desired standard of living.

The full planning tool

In Planafolio you can additionally include real estate, insurance, and other assets, and adjust tax rates individually.

No rush if you already have a Riester contract

Existing contracts are grandfathered. There's no need to switch in a hurry — take your time once concrete offers become available.

A real comparison only makes sense from 2027

Providers' concrete standard products won't exist until the law takes effect. Only then can costs and terms actually be compared.

Frühstart-Rente: own account optional

Under the bill, the €10 is paid without an application. Without an individual account it goes into the cohort's collective investment; an individual account is possible but not a requirement. The Frühstart-Rente has not been passed yet.

Details may still change

Some points are still being finalized through secondary legislation. This page will be updated as new details become available.

Not tax or investment advice

This page summarizes publicly available information and doesn't replace individual advice. For concrete decisions, a tax advisor or independent fee-only advisor is recommended.