Private pension provision

Actively shaping your income in retirement

It is widely known that the statutory pension alone will likely be insufficient to maintain your accustomed standard of living. Yet many people fail to take their financial future into their own hands early enough. Demographic change will inevitably widen the gap between pensioners and current contributors, making this issue even more pressing.

Those who want to enjoy their well-earned retirement without financial worries can use private retirement provision to actively shape their future pension income. This increases self-determination and expands your financial flexibility, enabling you to fulfill long-held wishes and dreams even in later life.

Flexible, secure and yield-oriented

The “perfect” retirement provision would be completely flexible regarding contributions and access to funds, fully secure at all times, and offer the highest possible returns. However, such a “magic solution” does not exist.

Instead, private pension provision involves compromises within the so-called “magic triangle of investing”: security, liquidity, and return. Which aspect is prioritized depends on many factors, including your risk tolerance, the time remaining until retirement, and any other existing provisions. Private retirement provision is therefore one of the most individualized financial decisions one can make.

The 3 golden rules

Three key rules apply to all efforts in private retirement planning:

1. Start early
   The earlier you begin, the greater your chances of building substantial wealth, as a longer saving period can reduce many risks, including capital market volatility. Even a few extra years of saving can make a significant difference in accumulated assets.

2. Beat inflation
   Maintaining purchasing power in retirement is crucial. This is only possible if your chosen retirement product generates returns above inflation. Otherwise, costs for housing, energy, and food may rise faster than your nominal savings, leaving your accumulated wealth insufficient to cover living expenses. Long-term investment products that leverage capital market opportunities are generally recommended, as they can deliver significantly higher returns than traditional savings accounts.

3. Stay committed
   The ultimate goal of retirement planning is to increase income in old age. It is essential to remain committed until retirement and avoid spending the accumulated wealth prematurely. For intermediate savings goals (holidays, car, education, etc.), separate savings plans should be established. Flexibility during the accumulation phase is also crucial to respond to changing life circumstances over the long term.

Regardless of whether you are a founder, student, employee, entrepreneur, or civil servant, private retirement provision enhances financial security in later life. Professional advice can determine individual needs and identify suitable products, while taking advantage of state incentives, guaranteeing lifelong pensions, and explaining high-potential solutions in detail.