How to use Wohnriester

What exactly do you have to repay from taxes?

And are the 2% interest added on top of the other interest?

Do I still have to pay the €96 to receive the subsidy, meaning as long as the subsidy is due, even if I have taken out financing, are they added on top of the amount to be financed?

You repay your personal tax rate

Basically: If you don't understand a product, you don't sign up for it. Riester is dumbing down the public

Yes, understanding it is really very difficult. I did have a Riester contract but not a Wohn Riester, rather a Riester pension. I think with the old Riester I am flexible and can use the money elsewhere; Wohnriester has many restrictions.

So far, I have only paid in €60 annually and received the full subsidy.

But that I have to pay taxes in retirement age is absolutely not acceptable.

There are plenty of pitfalls with Riester. And if you don’t understand it, you shouldn’t sign up for it at all.

I don’t have Wohnriester either, even though on paper we are perfect for it (3 children plus wife on parental leave). So I’m consciously missing out on a lot of "Förderung" because I just don’t like the conditions.

Many people think it’s great - a matter of faith. If you’re planning to do it, really sit down yourself and read everything through, and don’t let the gentleman at the bank calculate everything for you. He’s only after his sales commission :-)

Yes, I noticed that. I now have the old Riester Classic again; money only goes in there if, for example, we have a child and receive the money for three years. This year I am not paying anything anymore. It was only 60€ per year.

Unfortunately, he calculated it nicely for me, but the financing is also fixed, which means I pay less for the first 8 years, then double for 10 years, so I was so confused and signed without thinking.

And to receive the allowances, I would have to pay on top.

I think you should have all of this calmly explained to you until you understand it. You seem to have some kind of broker who gets money from you (directly or indirectly).

You will also pay taxes later on your "Classic" contract. The structures are just much easier to understand than the building savings contracts.

Simply put, your current contributions are paid from your gross income (retirement contributions in the tax return). In return, your returns at the start of retirement are treated as income and then taxed as income. Your income tax is therefore calculated from pension income + Riester pension payments.

The most important principle in all financial transactions has already been mentioned: Never enter into anything you do not understand from beginning to end.

Riester can definitely be a good option, but not in all constellations. I took out a contract 8 or 9 years ago and there is now over 30k in it, even though I have the special expense deductions paid out to me annually.

I also don’t like these very complicated Riester home loan financings. However, the regulation that allows you to use your classic Riester contract not as a pension at retirement age but to repay a home loan in order to enter retirement debt-free is sensible. For example, there is a home loan with a remaining balance of 67,000 at age 67. And there is a Riester-Rente classic or fund that has been saved over decades with 63,200 capital. Why rent it out then? You can also terminate the contract and use the 63,200 to repay and now enter retirement almost debt-free. Of course, the 63,200 is treated as imputed pension income and taxed. But I got my 63,200 and used it. The problem with annuitization is that I only live 6 years and then that’s it, and my pension belongs to the Riester provider.
My advice, therefore, is to let the Riester classic run, finance now without it without any Riester model, and in x years use the Riester capital for a final special repayment. Karsten