Riester pension: attractive and secure
The Riester pension is a state-subsidised private pension that allows you to close your personal pension gap. It is both safe and attractive:

During your active working life you pay contributions into a private pension contract, a bank savings plan or funds, and as an extra you receive growing state allowances and tax benefits. Later, you receive monthly benefits for life - in the form of an annuity or a payout plan. However, a partial payout of up to 30 percent of the retirement assets is also possible; the benefit does not therefore have to be granted exclusively as a lifelong pension. In addition, up to twelve monthly pensions can be paid out in one amount as an annual pension.

High returns due to allowances and guaranteed interest rate
Unlike with the statutory pension, where the contributions of the insured already flow back to the pensioners the next month, your contributions to the Riester pension, including the state allowances, are accumulated and later paid out to you again plus a guaranteed interest rate. Thanks to the state subsidy, the return on the Riester pension is usually higher than the interest on other forms of investment.

The Riester pension is aimed at employees and civil servants
The Riester pension is particularly suitable for employees and their spouses who want to close their pension gap in order to be financially provided for in old age. For the self-employed and freelancers, the Rürup pension model is particularly interesting because of the special tax deduction options.

State allowances and tax benefits
The Riester pension subsidy consists of two parts: State allowances are credited each year, and in addition there may be a tax advantage within the framework of the special expenses deduction in the income tax return.

Riester allowances
The allowances are made up of the basic allowance and the child allowance: the basic allowance is 175 euros and 300 euros per child (185 euros per year for children born before 1 January 2008). A tax deduction of 2,100 euros per year is possible. The tax office checks whether there is a tax advantage that goes beyond the allowance.

200 euro bonus for young Riester savers
In order to make the Riester pension more attractive for young people in particular, the state rewards those under 25 with a one-time bonus of 200 euros.

Subsidies of up to over 90 percent
Depending on income and marital status, the share of subsidies in the savings amount ranges from about 30 to over 90 percent. Rule of thumb: the more children and the lower the income, the greater the share of state subsidies.

Riester subsidies for all employees
All employees with statutory pension insurance and all civil servants are entitled to allowances and tax benefits for their Riester contract, as well as soldiers and those on civilian service, parents on parental leave, those with voluntary statutory pension insurance, those in marginal employment and the unemployed.

State support is also available to employees' spouses who are not subject to compulsory pension insurance, provided they opt for their own old-age provision contract - e.g. a housewife married to an employee subject to compulsory insurance with her own Riester policy.

As a self-employed person or freelancer, one is only entitled to state support within the framework of a Riester pension if the spouse is employed subject to compulsory insurance and has his or her own Riester policy.

The legislator has set guidelines for Riester products to ensure that the statutory subsidy really benefits provision in old age.

The private pension is safe
The capital saved must be paid out as a lifelong monthly pension or as part of a payout plan with lifelong benefits. A maximum of 30 percent can be paid out in one lump sum. The pension may not be paid until you reach the statutory retirement age (depending on the year of birth, the statutory retirement age is between 65 and 67), in the case of early retirement at the earliest from 60 (if the contract was concluded before 31.12.2011) otherwise at the earliest from 62 - see also the item "The pension phase".

At the beginning of the payout, the paid-in contributions must be available in full, and the pension capital must be protected against seizure and assignment.

Riester providers provide information annually
The investor must receive information at least annually on the account balance, use of capital, costs and returns. The fees for concluding and operating the contract must be spread over a period of five years.

In the event of the death of the pension beneficiary, the pension entitlement must be transferable to third parties. During the pay-in phase, the investor has the right to change providers. Existing contracts can also be included in the state subsidy if the aforementioned guidelines are integrated into the "old contract".

If you want to be provided for, you have to provide for yourself
The state pension is in crisis. Fewer and fewer insured people are paying for more and more pensioners, and there is no end in sight to this development. Today, personal responsibility is more important than ever - if you want to enjoy your life in retirement and be well provided for financially, you have to make your own provisions in good time.

Lifelong pension - subsidised by the state
The Riester pension is a form of private old-age provision. Private provision also includes endowment insurance, savings, the purchase of securities or home ownership.

The state promotes private old-age provision through special subsidies and tax concessions. Unlike the statutory pension, where the payments of the insured already flow back to the pensioners the next month, the contributions to private pension contracts, including the state allowances, are saved and later paid out again, plus interest and compound interest, as lifelong pensions.

Full allowances and tax benefits
You are granted the full allowances and tax benefits if you pay a certain portion of your salary into your Riester contract, including the allowances.

The personal contribution amounts to four percent of the previous year's income, but at least 60 euros per year.

Minimum personal contribution 60 euros
Especially for people with low incomes and children, the allowances may already be so high that you would not have to make any personal contributions per se. However, since the state subsidy is only granted if the insured person also contributes financially, a minimum contribution of 60 euros per year must be made in any case.

Flexible contributions - take advantage of special payments from your boss
As a customer, you can pay in as flexibly as your financial circumstances allow - for optimal old-age provision, however, regular contribution payments are recommended.

Tip: Many people use the special payments from their employer at the end of the year to finance their Riester pension.

Pension benefits possible from the age of 60
As a rule, payments from the Riester pension plan begin at the same time as the statutory old-age pension, i.e. after reaching the age of 65.

As an insured person, however, you can apply for benefits as early as 60 (if the contract was concluded before 31 December 2011 - otherwise at 62 at the earliest); the monthly pension payments are then naturally lower than when the pension starts at the statutory retirement age (depending on the year of birth, the statutory retirement age is between 65 and 67). With the start of pension payments, a partial payment of up to 30 per cent of the retirement assets is possible; the benefit does not therefore have to be granted exclusively as a lifelong pension. In addition, up to twelve monthly pensions can be paid out in one amount as an annual pension.

Lower tax burden in old age
Since Riester contracts are already tax-subsidised during the contribution phase, the later payments are taxed at the individual tax rate. The tax burden is usually lower than in the employment phase because the personal tax rate is generally higher during the active working years.

Finding the right path in the jungle of pension products is not easy. If you want to close your personal pension gap with a Riester pension, you will find yourself faced with a multitude of providers offering a large number of different products.

Optimal promotion through competent advice
The most important factor in choosing the right product is to make the best possible use of the state subsidy. You should therefore not do without thorough advice.

Riester pension also protected in case of unemployment
Anyone who becomes unemployed for a longer period of time can be required by the employment authority to first cover their living expenses from the liquidation of existing savings investments before they are entitled to citizen's benefits.

This applies, for example, to bank deposits, securities accounts and, within certain limits, also to endowment insurance policies - but not to state-subsidised old-age provision: claims from Riester contracts are protected from premature realisation in the event of unemployment, insofar as they were built up subsidised.