Roughly it goes like this. If you are an employee or civil servant, you can do Riester. The woman too, either dependent on your contract, or with her own, separate one. You say, I want model saving or model saving into funds. Every year Schäuble now contributes something, the more children, the higher the amount. Goal. Lifetime pension at retirement, then the payout phase begins, saving is over, it is harvested. Now I have, let’s say, saved for 12 years. I want to build. I want to use my Riester as capital. Politics enabled this because it counts as retirement provision to live rent-free. Condition. Whoever builds with Riester must be debt-free at retirement. So, I now take the sum saved over 12 years and the Riester provider basically lends me something in advance. I continue paying my contributions, plus something extra, because the borrowed amount is interest-bearing and because it may also be more than my original savings rate would have yielded. When I’m 65, I must be settled up.
Or… I have already saved quite a bit and want to use the money as equity in construction, to borrow less from the bank. That is now possible too. At the Zulagenstelle für Altervorsorgeverträge in Berlin, a department of the Rentenversicherung Bund, I register this. I give a sworn affidavit that I will inhabit the house myself, not a rental property. I submit the construction contract and if applicable, already incurred invoices. Now they allow me either to terminate the contract, I get everything, Riester is done, or a partial withdrawal, so I continue Riester and keep at least 3 thousand. I can choose between those. Their okay goes to the provider, I now request either this or that, and done.
This is probably about the pre-lending of an existing Riester contract. Then the saving premiums — is — already part of the saving premium — should — Karsten