Is a building savings contract still worthwhile with the current interest rates?

The credit interest rate is not so great either: 0.5% and then annually 7-10 euros account management fees and money for the in-house magazine are deducted.

I would cancel the magazine with a letter to the building society at the next possible date. You can also invest the money in other specialized literature. ;-)

The question is always what I want to achieve with a [Bausparvertrag]. What has been overlooked so far is that [Bausparvertrag] can provide interest rate security in 5-10 years, in your case in 8 years.

In your case, I would continue saving; in my opinion, you won't lose anything by doing so. Whether you will take the loan when you want to build or simply withdraw the balance is another question.

A building savings contract is always sensible when a) it is already concluded (and thus the - very high - contract fee has also been paid) and b) there is enough available income to pay the savings contributions. Condition b) is often a problem when a rate financing residential property already exists.

A building savings contract is a "participation" in a solidarity package. The savers pay in and acquire "valuation points" through their payments and the passage of time, which control the allocation (after all, the - compared to normal interest periods - low interest rates and the loans must be financed by someone).

Building societies currently have a problem (even if they may not like to admit it). It is therefore questionable whether the forecasted allocation upon demand (expiration of the fixed interest period) will actually materialize. No one knows; it could also turn out completely differently (later).

Customers with bullet loans repaid by life insurance have suffered / are suffering a similar fate. The promised maturity benefit is lower due to the steady reduction of profit participation (sometimes significantly) than "promised" at contract signing. Payments now often no longer suffice to repay the existing loans. An annuity loan concluded at the time would have been safely gone. It is true that tax reasons often used to be decisive for this option.

What I want to say is this: clarification about advantages / disadvantages, a comparative presentation of different models, and a complete presentation of opportunities / risks rarely actually take place. The now to be handed out "pre-contractual information" is a joke. These are now so extensive that hardly anyone consistently reads and deals with them.

The only recommendation here can be to seek advice from independent institutions in good time before concluding any property acquisition preparatory (what a word) contracts. A multitude of publications are available for self-study here (e.g., at the consumer advice center). It is clear that banks / insurance companies / building societies currently do NOT provide objective advice tailored to the essential concerns (exceptions prove the rule). ;-)

I write this because the threads about "How much house can I afford?" or "What does the bank want to see?" or "Can I afford the rate?" already go well beyond basic clarification. Comparable to the situation where the cost of a consumer loan is "irrelevant," as long as the loan is granted and the customer knows he has to pay 100 euros per month for 24 months. The rest is unimportant. ;-)

Amen. ;-)

The credit interest is not great either: 0.5% and then annually another 7-10 euros for account management fees and money for the in-house magazine goes away. I took it out in 2013 to ensure that I can still get cheap money at some point even if the low interest phase ends.

You have surely already paid the 1% costs. So the big cost item is already gone. In terms of the debit interest rate, the building society saver might be a bit more expensive than current ones, but still far from bad.

I would cancel the magazine with a letter to the building society at the next possible date. You can also invest that money in other specialist literature. ;-)

The question is always, what do I want to achieve with a building savings contract. What has been overlooked so far is that building savings contracts can provide interest rate security in 5-10 years, in your case in 8 years.

In my opinion, all arguments have already been made – so just a short statement from me.
Magazine – cancel: I had done the same in the past when I realized they were also charging me fees for it.

As already mentioned, you have already paid the biggest chunk of costs. You would then have incurred this effort for nothing. From my point of view, it would be nonsense to dissolve the building savings contract now.
You do not know where interest rates will develop. The only relatively sure thing is that interest rates will rise again at some point. As lastdrop already wrote: you secure yourself a fixed interest rate.

How you want to use the building savings contract when it matures is up to you. Our building savings contract represents the repair reserve (or will, at the first end of the fixed interest period, pay off the remaining KfW with the credit balance).
You can use the building savings contract in the future for repairs, for a special repayment (with or without a loan), or simply leave it to use later if needed. You can consider – if a lot has already been paid in – whether to reduce your monthly payment beginning with the financing. You should calculate when under these circumstances the 1.6% will be due to you (because by reducing payments in the last year, the savings rate and maturity are reached later).
Personally, I would not include it in the intended financing – unless interest rates have developed so far in 3 years that it is foreseeable that the interest rate in 2023 is above 1.6%.

That turned out to be a bit more than I thought.


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PS: F-pNo – I put your text into a readable form ;-)

Rhineland greetings
Building Expert

First of all, many thanks to everyone who replied to me here. I would especially like to thank those who provided detailed and well-reasoned arguments. As a newcomer to the forum, I would also like to say that I find the tone and atmosphere here very pleasant and factual. Many thanks for that as well. :-) This is not always the case in other forums.