Opinion on Financing Wonnigster or Annuity Loan

Hello danielbo,

regarding Wohnriester you should really inform yourself thoroughly. It is made very "very" appealing by the credit broker because the bonuses for it are very high.
Opinions differ greatly here in the forum as well, and I am one of those who think nothing at all of Wohn-/Bauriester. I would like to present the reasons for this to you below.

Pro:

[*
With Wohnriester you can secure a follow-up financing for an existing construction financing
[*]Riester can also be worthwhile if the interest rate is higher compared to non-subsidized loans (which is usually the case since these are better positioned)
[*]Your state bonus is 154 euros annually. For each child you get a max. 300€ premium (if born after 2008, if before 2008 it is 185€). However, you have to use all allowances etc. for repayment of your loan.
[*]You can deduct up to 2100€ per year in repayment payments on your taxes. ATTENTION See contra


Contra:


[*]You must move into the property that you finance via Wohnriester yourself. When selling the residential property, the proceeds must flow into a new property for you within 2 years before or five years after the sale or you must conclude a new Riester contract with it.
[*]You have to repay the money deducted on taxes in old age!
[*]The loan must be paid off by retirement age.
[*]You must spend at least 4% of your monthly gross income as repayment for the loan to receive the full allowances.
[*]Now comes the main downside in my opinion „deferred taxation“
[LIST]
[*]The legislator invented the Wohnförderkonto for this. This is a fictitious account where the state-subsidized benefits for repaying the Riester construction financing are recorded. The maximum is 2100€ per year. This amount is compounded annually at 2%. At the time of house construction, you pay less to the tax office but have to pay tax on it later in retirement. This should actually be worthwhile because it is assumed that the tax rate in retirement is lower than during working life. You can repay in 2 ways. Either you pay the taxable amount all at once and receive a 30% discount or you pay a monthly rate starting at retirement (the state assumes at age 60) until the age of 85.
[*]The whole thing is also a sensitive subject in the event the Riester participant dies. Please use search engines again for this, as there are different scenarios.

But since no one can look into a crystal ball to see what tax rate you will really have then, it is rather uncertain. Also, some people have an issue with still having to pay off loans in retirement.

I am of the opinion that when the time comes you should be done and not have to worry about loans anymore, and that is why something like this is out of the question for me personally and for some others.

For example, I took out 2 building savings contracts last year which are Riester-funded (thus better interest conditions) but I do not claim the funding due to the points mentioned above.

Hope I could perhaps shed some more light on the matter.

Regards Andi

How high exactly are your two exact annual gross incomes?

I have the feeling that during the WR they simply threw out what one can/may do without considering the personal situation.

The share of the building society savers (WR) in the overall construct therefore seems to me simply too high.

Or why exactly 100,000 per spouse? Was there a reason given for why precisely that amount?

Well, now that I see your profession , I wouldn't have written that :D p.s sounds very interesting though.

currently I make about 50,000 and my wife about 18,000. The WR offer should run completely through WR for us. It was a suggestion from the building society. thank you very much for your list :)

What a coincidence who that came from. I'll take a moment to think about it during my break.


What's the side swipe supposed to mean? ;-)
I do consider myself committed to a professional ethic, which some colleagues like to forget.

I don't want to say that the model can be good, but it doesn't seem optimal to me at least within the framework of holistic advice.

, no problem. Hope it was somewhat understandable. I also dealt with it for a long time back then and read a lot. But you quickly forget some things again.

, that wasn’t meant like that at all, so don’t misunderstand ;) (or you didn’t)
:)