Financing with future payment

After we also have a 500k loan, 100k will be paid off in 4 years through special repayments.

just remember that the OP wanted to take out 2 KFW loans. There are no special repayments with those. So 5% of about 300,000 is only 15k annually. I still consider special repayments the most sensible option!

I would simply leave the 100k in the account until the KfW share is due after 10 years. The interest rates are so low that early repayment hardly makes a difference. Alternatively, buy a few ETFs instead of a savings account. More returns are to be expected there than the loan costs in interest.

I would simply leave the 100k in the account until the KfW portion is due after 10 years. The interest rates are so low that early repayment hardly makes a difference. Alternatively, buy a few ETFs instead of a savings account. More return is expected there than the loan costs in interest.

That means he not only loses the compound interest effect by saving on the loan costs, but also inflation. That makes no sense at all. So if the money is not invested long-term, I would also make special repayments.

That means he not only loses the compound interest effect when saving on the credit costs, but also inflation. That makes no sense at all.

So if the money is not invested long-term, I would also make special repayments.

Yes, and pay attention to the maximum annual special repayment amount. In this scenario, a 10% component (i.e., €50,000 annually) might be worth considering. Calculate it.
With the usual 5%, the €100,000 inflow will be spread over four years.

That means he not only loses the compound interest effect when saving credit costs, but also the inflation.

No, inflation devalues the credit debts just as well. Whether I make a special repayment of 100k today or in x years is completely identical when viewed without compound interest effects.

At well under 1% interest, it is very difficult to optimize anything. Every option must be calculated with a fine pencil. For example, if you negotiate a 10% special repayment, the interest rate might slightly increase.

It is also worth considering how secure the money is coming in and whether you would rather use it to beautify the garden or something else. Many loans have special repayment options; hardly anyone uses them in the first few years.

No, inflation devalues debt just as well. Whether I make a 100k special repayment today or in x years is completely identical when ignoring compound interest effects. With interest rates well below 1%, it is very difficult to optimize anything. Every option must be calculated very precisely. For example, if you negotiate a 10% special repayment, interest rates might increase slightly. It is also worth considering how secure the money is coming in and whether you might rather use it to improve the garden or something else. Many have special repayment options, but hardly anyone uses them in the first years.

And especially in the first years, special repayments bring the most benefit. Of course, debts are also reduced by inflation. Nevertheless, the 100k would only be worth about 85k in 10 years if it just sits in the account. That simply makes no sense. I’m saying, I would also look at how to invest the money better. But then you must not be dependent on that money. Depending on the situation, maybe even 2 small condominiums for rent are possible.