Best German Children's Savings / Junior Depot Plans 2026

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Expats & Kids Savings Plans in Germany

In Germany, children are treated as independent taxpayers from birth. This allows families to set aside part of their wealth and assign it to their child, using the child’s own tax allowances to shield investment returns from the standard capital gains tax.

While the traditional German Sparbuch or basic savings account loses money to inflation, a Junior Depot works more like a child-owned broker account, allowing you to invest in global ETFs, funds, and other securities in your child’s name. If managed carefully, the account can grow for many years with little or no tax due.

For expat families, however, the German Junior Depot is not just a question of finding the cheapest broker. As with other German banking products, such as a blocked account, paperwork, tax details, and identity verification can matter just as much as fees. You also need to understand German tax rules, family-insurance limits, custody documents, identity verification, and what happens when your child turns 18.

Top Junior Depot Providers Compared

For expats, the biggest hurdle is often identity verification. Many neo-brokers rely heavily on VideoIdent, which may fail with non-EU passports, older passports, residence permits, or documents that do not match German formatting expectations.

Traditional direct banks that offer PostIdent can be slower, but they are often the safer choice for international parents. With PostIdent, you verify your identity physically at a Deutsche Post branch instead of relying only on video software. Here is a sample broker account provider comparison for expats:

How to Compare German Children’s Savings Plans

A good Junior Depot comparison should focus on more than just the broker’s headline price, especially if you are comparing it with a traditional savings account. Since this account may stay open for 10, 15, or even 18 years, you should choose a provider that is affordable, easy to manage, and realistic for your documents.

Before opening a child broker account, compare the following:

• Account fees: Many German Junior Depot accounts do not charge a custody fee, but always check the current price list.
• ETF savings plan fees: If you invest monthly, the savings plan cost matters more than one-time trading fees.
• Minimum savings amount: Some brokers allow small monthly ETF plans, while others require higher minimums.
• ETF selection: A broad global ETF is enough for many families, but the broker should still offer low-cost options.
• Verification method: Expats should check whether the broker offers PostIdent, not only VideoIdent.
• Document rules: Foreign birth certificates, different surnames, and custody documents can slow down the application.
• Parental access: Check whether both parents need to sign and whether both can manage the account online.
• Language and support: English support is helpful, but many German broker account processes still happen in German.

The cheapest German Junior Depot is not always the best Junior Depot for expats. If your application gets stuck during identity verification, a slightly more traditional broker may be easier in practice.

The German Tax Hack: €13,000 Tax-Free Per Year

In Germany, every individual is a separate taxpayer, including your newborn baby. This is the core of the Junior Depot strategy.

If you invest in your own name, your capital gains above your personal allowance are usually taxed. But if the broker account belongs to your child, your child can use their own tax allowances. These allowances reset every year.

The Three Tax Allowances for Children in 2026

This limit applies to profit, not the total value of the Junior Depot. For example, if a child has a €50,000 ETF portfolio and realizes €2,000 in gains, only the €2,000 gain matters for tax purposes.

However, this does not mean every family should actively realize thousands of euros in gains every year. The tax allowance is only one part of the picture. Public family insurance, future student aid, and long-term control of the money can also matter.

How to Activate the Tax Shield

The tax benefit does not work automatically in every situation. To use the child’s allowances properly, you need to set up the correct tax paperwork with the broker and, in larger cases, with the tax office.

1. Open the Junior Depot: Choose a broker account in the child’s name. The parents manage the account until the child turns 18.
2. Set the exemption order: In the broker’s online banking, set the child’s Freistellungsauftrag to up to €1,000. This stops the broker from withholding tax on the first €1,000 of investment income.
3. Apply for the NV-Bescheinigung if needed: If your child’s portfolio grows large enough to generate more than €1,000 in annual investment income, you can apply for a Nichtveranlagungsbescheinigung at your local Finanzamt. Submit it to the broker so the bank does not automatically withhold tax above the saver’s allowance.

Freistellungsauftrag: The First Step

The Freistellungsauftrag is usually the first tax setting parents should handle after opening the Junior Depot. It tells the broker that your child wants to use their saver’s allowance.

Important: the exemption order belongs to the child, not to the parents. It must use the child’s tax ID. If the child has more than one bank or broker account, the €1,000 allowance must be divided across all accounts.

NV-Bescheinigung: For Larger Child Portfolios

The Nichtveranlagungsbescheinigung, often shortened to NV-Bescheinigung, is useful when the child has investment income above the €1,000 saver’s allowance but is still not expected to owe income tax.

This can happen if grandparents transfer a larger amount into the Junior Depot, if the child receives an inheritance, or if the account has grown significantly over time.

The NV-Bescheinigung is not always necessary for small Junior Depots. If your child’s investment income stays below €1,000 per year, the Freistellungsauftrag is often enough.

The Bureaucracy: What Expats Need to Know

Opening a German Junior Depot involves more paperwork than opening a standard broker account. The bank must verify the child, the parents, the tax information, and who is legally allowed to manage the child’s money.

Before starting the application, prepare a small “digital dossier” with the most important documents.

1. The Tax ID (Steuer-Identifikationsnummer)

You cannot open a Junior Depot without the child’s German tax ID.

Born in Germany? The tax ID usually arrives by post after birth.

Moved to Germany? The tax ID usually arrives after the child is registered in Germany through the Anmeldung. If you lost the number, you can request it from the BZSt website.

The broker needs this number for tax reporting, the Freistellungsauftrag, and the child’s investment income.

2. The Birth Certificate (Geburtsurkunde)

German banks are strict about custody chains. They need to confirm that the child exists and that the applying adults are legally allowed to open the broker account.

• German birth certificate: Usually accepted easily.
• International birth certificate: Often accepted, but some brokers may ask for a certified translation.
• Foreign birth certificate: May require a certified German translation or additional documents.
• Different surnames: If the child and parents have different surnames, the broker may request extra proof.
• Sole custody: If only one parent has custody, the bank may ask for official custody documents.

Some banks accept high-quality scans. Others may require original documents by post and return them later.

3. Identity Verification: The PostIdent Hack

This is where many expats get stuck. Some neo-brokers rely on VideoIdent providers that may struggle with passports from countries such as India, China, Brazil, or with older non-biometric passports.

Pro Tip: If you have a non-EU passport, choose a bank that offers PostIdent, such as ING, Comdirect, or Consorsbank. You print a coupon, visit a Deutsche Post branch, and the postal worker manually verifies your passport. This can bypass problems with video software.

PostIdent is not as fast as a mobile-only broker setup, but it can be more reliable for international families.

Legal Ownership: The Money Belongs to the Child

A German Junior Depot is not a trust and it is not a hidden parent account. It is a child-owned broker account.

That means money transferred into the Junior Depot legally belongs to your child. Parents manage the account as custodians, but they cannot freely use the money for themselves.

• You can invest the money for the child: For example, through ETF savings plans.
• You can use the money for the child’s benefit: For example, education-related costs or other expenses that clearly benefit the child.
• You should not use the money for yourself: Rent, holidays, household costs, or parent expenses should not be paid from the child account.

The Age 18 Cliff

When your child turns 18, the Junior Depot becomes their normal adult broker account. Parental control ends.

This is the biggest emotional and practical downside of a German Junior Depot. The tax benefit can be attractive, but you must accept that your child will eventually decide what happens to the money.

Your child might keep investing. They might use the money for university, a driver’s license, or a year abroad. They might also sell the investments and spend the money in a way you would not choose.

Insurance Trap

The Solution: Invest in Accumulating ETFs. These reinvest dividends automatically, keeping the “realized income” low and preserving insurance eligibility.

This is why the German Junior Depot should not be used only as a tax optimization tool. A child can have enough tax allowance to avoid income tax but still create problems with public family insurance.

For most families, this does not matter in the early years because the account is small. It becomes more relevant if the child receives a large gift, inheritance, or has a high-value Junior Depot with distributing ETFs.

Junior Depot vs. Parent Broker Account

Many parents ask the same question: should I open a Junior Depot or just invest for my child inside my own broker account? For self-employed parents, it is also important to keep family investing separate from business finances and any business bank account.

There is no universal answer. The right account depends on whether you value tax efficiency or control more.

If you are investing for 10+ years and are comfortable with the money becoming your child’s property, a Junior Depot can make sense. If you want to decide later how and when the child receives the money, a parent-owned broker account may be better.

The Warning for US Citizens

The Alternative: Speak with a qualified cross-border tax adviser before investing. Some US-connected families look at US-based custodial structures or US-domiciled ETFs, but availability depends on residence, broker access, and tax status.

This issue affects children with US citizenship, including children who inherited US citizenship from a parent. Even if the child lives in Germany and has never lived in the United States, US tax rules may still apply.

For these families, the question is not just “which German Junior Depot broker is cheapest?” The better question is whether a German child broker account with European ETFs is suitable at all.

Common Junior Depot Mistakes

• Choosing the cheapest broker without checking verification: A low-cost broker is useless if your passport or documents are rejected.
• Forgetting the Freistellungsauftrag: Without it, the broker may withhold tax even though the child has unused allowance.
• Using the child account like a parent account: Money in the Junior Depot belongs to the child.
• Ignoring the age 18 handover: Your child will receive full legal control of the account.
• Realizing too much income: Large dividends or gains can affect public family insurance.
• Buying distributing ETFs without thinking: Distributions can create regular visible income for the child.
• Ignoring US citizenship: US tax rules can make German ETF investing unsuitable.
• Assuming every broker accepts foreign documents: Expats should compare the application process, not just the savings plan fee.

Summary Checklist

• ✅ Step 1: Locate your child’s tax ID and birth certificate.
• ✅ Step 2: Compare German Junior Depot brokers by fees, ETF selection, PostIdent availability, and expat document requirements.
• ✅ Step 3: Choose a provider. ING is often a safe bet for expats who prefer a traditional bank and may need PostIdent.
• ✅ Step 4: Set up a monthly savings plan (Sparplan) into a broad global ETF, such as an MSCI World or FTSE All-World ETF.
• ✅ Step 5: Set the Freistellungsauftrag to up to €1,000 in the child’s name.
• ✅ Step 6: Consider an NV-Bescheinigung only if the child’s annual investment income is expected to exceed €1,000.
• ✅ Step 7: Check the family-insurance limit before realizing large gains or using distributing ETFs.
• ✅ Step 8: Make peace with the age 18 rule: the child will control the Junior Depot as an adult.

Conclusion

A German Junior Depot can be one of the most effective ways to invest for a child in Germany, especially if you want to use the child’s own tax allowances and build long-term ETF savings. For expat families, however, the best Junior Depot is not always the cheapest broker account. It is the provider that you can actually open, verify, and manage without document problems.

Before opening an account, compare Junior Depot brokers by fees, ETF savings plans, PostIdent availability, required documents, and long-term usability. Be sure to remember the two biggest trade-offs: the money legally belongs to your child, and high investment income can affect public family insurance. If your child is a US citizen, get specialist tax advice before buying ETFs through a German broker.

If you are comfortable with these rules, a Junior Depot can be a simple and tax-efficient way to start investing early for your child’s future.

Frequently Asked Questions