Special repayment KfW or save funds

That is solely your decision.

I also face this choice every year. My large loan with almost 3% interest is paid off with maximum special repayments. I believe I can also beat the KFW at 1.4% with ETFs even after taxes. If my plan goes wrong and the prices are bad after 10 years, I can always extend it. Perhaps more importantly, I have an additional liquidity reserve for emergencies. If things go well, loans are thrown at you. But if things go bad (unemployment/disability insurance or similar) and you need a loan, you won’t get one, even though you have made lots of special repayments. So it’s better not to put every cent into special repayments. (even though I understand wanting to get rid of the loan as quickly as possible)

Funds are great = sell and misuse

Repay KfW = reduce debt

it's always a dilemma when you save on the side and then do something else with it and make excuses

Be happy, with KfW and/or home repayment you have a fixed secure return through the repayment

It is always a dilemma when you save on the side and then use the money for something else and justify it nicely

Why dilemma? Free liquidity for investment or special repayment is a luxury situation.

On the one hand, of course, you should be able to handle money and not blow it.
On the other hand, a property of course represents a concentration risk. With all other investments, you try to avoid this and would never put 100% of your investment into a real estate fund.
Thirdly, you build an additional liquidity reserve for extraordinary emergencies (e.g. long illness, unemployment, and disability insurance). Of course, I don't mean for broken car, washing machine, and the like.

A basic prerequisite for the consideration should be that a rise in interest rates after 10 years does not knock you down, because it is quite possible that the prices are at their lowest point after 10 years. With a special repayment of over €5000 and a remaining debt of €65k, I do not assume that the rise in interest rates would lead to ruin.
On the other hand, it should of course not be a 100% financing.


Weren't you the one who took out a loan for a car alongside the property?

Well, ETF with 8% (before tax) is quite optimistic. Look at the prices of the last few years, somehow more volatile than the years before.

I would still start with ETFs and then see where you stand in 8-10 years. Sell in time It also depends on how the real estate interest rates are. Maybe they are as low as they are now, then you could simply do a follow-up financing if the ETFs perform really badly. The next point is how you assess your own financial situation in 10 years, whether a significantly more expensive follow-up financing (also of the other loan portions) is still manageable or if it breaks your neck.

As I said, personally I would currently prefer to take the risk. Or something like 30% special repayments, 70% ETF.

But wouldn't it possibly be more sensible to simply continue financing if the ETFs are doing great and the loan interest rates are still very low?