Living
Financial Planning
As the world’s third-largest economy, Germany has no shortage of potential investments. And, like in any major economy, an entire industry has grown out of trying to help investors make wise choices. However, statistically, Germans are not investors, they are savers. Since the cost of living in Berlin is one of the lowest in Germany, which already has a low cost of living, you may be able to join the natives and put away a few extra euros. Banks are happy to help you add a savings account to your regular account or open an online brokerage account. With interest rates at a stagnant record low, don’t expect much from a savings account. If you’d like someone to help with your financial planning, your bank could be a good starting point or you could also look to companies such as MLP, which specialise in providing financial products and advice. German financial planners are regulated by the country’s securities regulator, known as BaFin, short for Bundesanstalt für Finanzdienstleistungsaufsicht (www.bafin.de). If you have difficulties with a financial planner, BaFin will mediate disputes.
There are thousands and thousands of financial planners, so it’s hard to find a definitive list. Friends and colleagues are the best source of information. Try to interview several potential planners and go with someone who understands your ideas and goals. Ask for proof that they’re covered by liability insurance, known as Haftpflichtversicherung, in case they give bad advice.
Berlin apartments have become a popular investment for foreigners, mostly because of low prices – to people in London an apartment in Berlin seems too cheap not to buy. There are no restrictions or extra fees for foreigners buying into the Berlin market. But just as Germans are savers, not investors, they are also renters, not buyers, so real estate prices rarely climb and have even slid slightly in recent years. Still, some Berlin neighbourhoods have seen impressive price growth due to the foreign interest.
It’s probably best to open some form of account in Germany because paying bills relies on the ability to transfer funds to satellite television companies, internet providers and other services, which can get expensive from overseas. Whether or not you need to keep an account at home depends on whether you ever plan to return there or the amount of funds in your bank account – with the euro at incredible highs, you would likely lose a sizeable chunk by converting any savings. Offshore accounts could offer some flexibility if you relocate often, but the temptation to dodge taxes could land you in hot water. Experts don’t see the euro falling significantly for years, so maybe it’s best to keep your savings where they are.
There are thousands and thousands of financial planners, so it’s hard to find a definitive list. Friends and colleagues are the best source of information. Try to interview several potential planners and go with someone who understands your ideas and goals. Ask for proof that they’re covered by liability insurance, known as Haftpflichtversicherung, in case they give bad advice.
Berlin apartments have become a popular investment for foreigners, mostly because of low prices – to people in London an apartment in Berlin seems too cheap not to buy. There are no restrictions or extra fees for foreigners buying into the Berlin market. But just as Germans are savers, not investors, they are also renters, not buyers, so real estate prices rarely climb and have even slid slightly in recent years. Still, some Berlin neighbourhoods have seen impressive price growth due to the foreign interest.
It’s probably best to open some form of account in Germany because paying bills relies on the ability to transfer funds to satellite television companies, internet providers and other services, which can get expensive from overseas. Whether or not you need to keep an account at home depends on whether you ever plan to return there or the amount of funds in your bank account – with the euro at incredible highs, you would likely lose a sizeable chunk by converting any savings. Offshore accounts could offer some flexibility if you relocate often, but the temptation to dodge taxes could land you in hot water. Experts don’t see the euro falling significantly for years, so maybe it’s best to keep your savings where they are.
