Uncertain due to financing

The rates are approximate values because I don't have the exact numbers in my head. I think it's 840€ over 10 years for the 280,000€ loan + KFW. I was wrong about the interest rates over 15 years. It's not 2.3%, but 2.7%. At 2.3%, you really wouldn't have to think twice. Right now, we're concerned about flexibility. If there is money left over, it will be put into the special repayment. But we also have to expect that a "new" car will be due or the washing machine will break down. We are currently calculating with a follow-up financing rate of 4.5%. But that is just a gut feeling and speculative. But you have to plan for something.

Flexibility is one thing. The other is the interest rate risk after 10 years. That would be significantly smaller with a purchase period of 15 to 20 years, as you can react more flexibly to the interest rate market there. And I hardly believe that interest rates will be significantly lower in 10 years.

What have you decided on now?

another suggestion from me:

keep the repayment as low as possible 1%, meanwhile save a little with a fund of funds!

in numbers this means for me:

financed 3 months ago for 15 years at 1.7%
repayment 1%
net income 4000 EUR
bank&KfW installment approx. 880 EUR
savings rate fund of funds: 500 EUR monthly (have had this for 3 years already)

in the long term, the fund of funds yields at least about 4% return, if not even more. despite the difficult situation at the moment, it is currently holding quite stable... so no stock market crash, and if there is one, not a big deal... you just have to be patient and let the money lie and work!

after 15 years a review will be made.

advantage of the whole thing: the funds are flexible at any time, and can be accessed for upcoming repairs or to skip an installment. but you have to run it strictly... mine has been running steadily for 3 years.

interest rates have risen somewhat, but I still think it’s worth it, the expected return (I’m not talking about guaranteed!!!) is still higher than the bank interest.

of course, it requires a bit of strong nerves, but I don’t find it that mega risky!

of course it requires a bit of strong nerves, but I don't find it that mega risky!

I always find alternative options to protect oneself against rising interest rates or high residual debt to be good.

Investing money for that purpose is also not entirely wrong, but a fund of funds is not the optimal choice. The costs are too high, and as mentioned, there is no guarantee that you can access your money exactly at the time (end of the fixed interest period).

A somewhat more sensible option would be an investment in ETFs that track the market. There are no fees for this, but the problem of uncertain availability still exists.

There are also investment products that guarantee your invested capital, so they practically offer protection against falling prices. And not only at the end of the term but also during the term. This would allow you to access the money you really need much more precisely and somewhat more securely at the time you need it.

I always find alternative ways to hedge against rising interest rates or high residual debts a good idea.

Investing money for that purpose is not entirely wrong either, but a fund of funds is not the optimal option. The costs are too high and, as mentioned, there is no guarantee that you can access your money exactly at the time (end of the fixed interest period).

A somewhat more sensible option would be an investment in ETFs that track the market. No fees are incurred, but the problem of uncertain availability still exists.

There are also investment products that guarantee your deposited capital, in other words, practically a hedge against falling prices. And not only at the end of the term but also during the term. This would allow you to access your money much more precisely and somewhat more securely at the time when you really need it.

Fund of funds certainly cost higher fees than ETFs, but I do not find them dramatically high. Personally, ETFs are too aggressive for me and too risky as a "building block" in real estate financing.