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Investment Options for Expats in Germany
Written by
Sadie Voss
Content Lead & Editor
Sadie Voss is the Lead Editor for How-to-Germany.com. As an expat who carved her own way into Berlin from the United States, Sadie is deeply...
Reviewed by
Erkan Boga
Erkan Boga is the founder and CEO of qmedia GmbH, the publishing house behind How-to-Germany.com. He established the platform with the clear vision of creating...
- Start with your timeline: Short-term money usually belongs in savings accounts or fixed-term deposits, while long-term money can be invested in ETFs, funds, pensions, or property.
- Investment accounts matter: Expats may need to understand German broker accounts, ETF savings plans, Junior Depots, robo-advisors, private pensions, and crypto platforms.
- ETFs are a common starting point: Many expats use ETF savings plans because they are simple, diversified, and available through German online brokers.
- German tax rules matter: Investment income is generally taxed in Germany, with an annual saver’s allowance of €1,000 for single taxpayers and €2,000 for married couples or civil partners filing jointly.
- Portability matters for expats: Before choosing pensions, property, or long-term products, consider whether you may leave Germany later.
- US citizens face extra restrictions: FATCA rules mean many German brokers and neo-brokers do not accept US persons.
Best Investment Options in Germany
| Stock exchange: | Gettex |
|---|---|
| Order price: | €0.99 |
| Stock exchange: | Lange & Schwarz Exchange |
|---|---|
| Order price: | €1 |
| Stock exchange: | Frankfurt |
|---|---|
| Order price: | €4.90 + 0.25% |
| Minimum price: | €9.90 |
| Stock exchange: | Xetra |
|---|---|
| Order price: | €4.90 + 0.25% |
| Minimum price: | €9.90 |
| Maximum price: | €59.90 |
| Stock exchange: | Gettex |
|---|---|
| Order price: | €10 |
| bis €5,000: €10 | |
| bis €5,000: €10 | |
| von €5,000.01 bis €20,000: €15 | |
| von €5,000.01 bis €20,000: €15 | |
| ab €20,000.01: €30 | |
| ab €20,000.01: €30 | |
Germany offers many ways to save and invest money, from simple savings accounts to ETFs, stocks, broker accounts, pension products, real estate, and crypto. For expats, the best investment option depends not only on return potential, but also on taxes, fees, risk, currency, account type, and whether you may leave Germany later.
If you are new to Germany, it is usually best to start with the basics: build an emergency fund, understand your tax situation, open the right bank or broker account, and only then choose investments based on your time horizon.
This guide explains how to invest money in Germany as an expat, including short-term investments, long-term investments, German investment accounts, broker accounts, Junior Depots, ETF savings plans, taxes, FATCA restrictions for US citizens, and common mistakes to avoid.
This page is general educational content, not personal investment, legal, or tax advice. Investment products can lose value, tax rules can change, and expats may have obligations in more than one country. Before making large investment, pension, crypto, or tax decisions, consider speaking with a qualified German tax advisor, licensed financial planner, or cross-border specialist.
Investment Options in Germany Compared
| Investment option | Best for | Risk level | Time horizon | Expat consideration |
|---|---|---|---|---|
| Tagesgeld | Emergency fund and short-term savings | Low | Short-term | Easy to access and usually simple to manage. |
| Festgeld | Fixed savings | Low | Short to medium-term | Money is usually locked until the end of the term. |
| ETFs | Long-term wealth building | Medium to high | Long-term | Popular with expats because they are diversified and portable. |
| Stocks | Active investors | High | Long-term | Requires more research and risk tolerance. |
| Mutual funds | Managed investing | Medium to high | Long-term | Fees can be higher than ETFs. |
| Robo-advisors | Hands-off investing | Medium to high | Long-term | Useful if you want automated portfolio management. |
| Private pension | Retirement planning | Varies | Long-term | Check fees, tax treatment, and portability before signing. |
| Real estate | Long-term residents and property buyers | Medium to high | Long-term | Less flexible if you leave Germany. |
| Crypto | Speculative investors | Very high | Varies | Tax treatment, holding periods, and documentation are important. |
Short-term money usually belongs in safer, more accessible accounts such as Tagesgeld or Festgeld. Long-term money can usually take more risk through ETFs, funds, pensions, property, or other investments.
Types of Investment Accounts in Germany
Investing in Germany is not only about choosing between ETFs, stocks, savings accounts, or real estate. You also need the right account type. Some accounts are used for buying securities, some for children, some for automated investing, and others for retirement or short-term savings.
For expats, this can be confusing because German investment products often use terms such as Depot, Junior Depot, Sparplan, Tagesgeld, Festgeld, Bausparvertrag, and betriebliche Altersvorsorge.
Investing in Germany is not only about choosing between ETFs, stocks, savings accounts, or real estate. You also need the right account type for the purpose of the money.
| Account type | German term | Best for | Important for expats |
|---|---|---|---|
| Broker account | Depot | Buying ETFs, stocks, bonds, funds, and securities. | Usually the main account type for self-directed investing. |
| ETF savings plan | ETF-Sparplan | Monthly investing into ETFs. | Useful for long-term wealth building with regular contributions. |
| Junior broker account | Junior Depot / Kinderdepot | Investing for children. | Assets legally belong to the child and are controlled by the child at adulthood. |
| Robo-advisor account | Robo-Advisor / digitale Vermögensverwaltung | Automated investing based on risk profile. | Simpler than choosing ETFs yourself, but usually has extra management fees. |
| Instant-access savings account | Tagesgeldkonto | Emergency fund and short-term savings. | Good for money you may need soon. |
| Fixed-term deposit | Festgeldkonto | Fixed savings over a set term. | Less flexible because money is usually locked during the term. |
| Private pension account | Private Rentenversicherung | Long-term retirement planning. | Can be complex and less flexible if you leave Germany. |
| Company pension | Betriebliche Altersvorsorge | Employer-supported retirement savings. | Can be useful for employees, but check portability and payout rules. |
| Building savings contract | Bausparvertrag | Saving toward future property financing. | Relevant mostly if you plan to buy property in Germany. |
| Crypto account or wallet | Krypto-Börse / Wallet | Buying, selling, or holding crypto assets. | High risk and requires careful tax documentation. |
Broker Account / Depot
A German broker bank account, called a Depot in Germany, is the main account used to buy and hold securities. If you want to invest in ETFs, stocks, bonds, mutual funds, or other securities, you usually need a Depot.
A broker account is different from a normal current account. Your current account is used for salary, rent, bills, and spending. Your broker account is used for investing.
A German broker account can be useful because many German brokers handle German investment tax automatically. This can make tax reporting easier than using a foreign broker.
Popular German broker and investment platforms include Trade Republic, Scalable Capital, ING, comdirect, flatex, and Finanzen.net Zero. Availability, fees, tax handling, English support, and eligibility can differ, especially for US citizens and other foreign tax residents.
When comparing broker accounts, check:
- Account maintenance fees.
- Account opening requirements.
- Available ETFs, funds, stocks, and exchanges.
- English support.
- ETF savings plan fees.
- Order fees.
- Tax handling.
- Whether the broker accepts your citizenship and tax residency.
- Whether you can keep the account if you leave Germany.
US citizens, green card holders, and other US persons should check broker eligibility before applying. Due to FATCA and US reporting requirements, many German neo-brokers and direct banks do not accept US persons or may restrict investment products. This can affect platforms such as Trade Republic, Scalable Capital, Finanzen.net Zero, and some direct banks. US expats may need specialized cross-border tax advice before opening an investment account in Germany.
ETF Savings Plan / ETF-Sparplan
An ETF savings plan, or ETF-Sparplan, lets you invest a fixed amount into an ETF regularly. Many investors use monthly ETF savings plans to build wealth over time.
An ETF savings plan can be simple, automated, and flexible. Instead of trying to time the market, you invest regularly according to your chosen schedule.
An ETF savings plan can be useful if you:
- Do not want to buy individual stocks.
- Prefer a long-term approach.
- Want diversification through ETFs.
- Want to invest monthly.
- Want to start with smaller amounts.
Before starting, check the ETF selection, savings plan fees, minimum monthly contribution, tax handling, and whether the broker supports your documents and residence situation.
Expats should also understand the Vorabpauschale, especially when investing in accumulating or reinvesting ETFs. This is a German pre-tax mechanism for investment funds where tax can be charged on a calculated, unrealized return, even if you did not sell ETF shares or receive a cash distribution. Because interest rates have been positive again in recent years, the Vorabpauschale has become relevant for many ETF investors in 2024–2026.
If you use a German broker, the tax is usually calculated and withheld automatically. However, the money may be debited from your linked broker cash account at the beginning of the year. If there is not enough cash available, this can surprise expats with a negative balance, failed debit, or broker message. Keeping a small cash buffer in your settlement account can help avoid problems.
Junior Depot / Kinderdepot
A Junior Depot, also called a Kinderdepot, is a broker account opened in a child’s name. Parents usually manage the account until the child becomes an adult.
A junior depot account can be used to invest in ETFs, funds, and sometimes individual shares for a child’s long-term future. It can be useful for families who want to save for education, future housing costs, or general wealth building.
Assets in a Junior Depot legally belong to the child. When the child reaches adulthood, they usually gain control over the account.
A Junior Depot may be useful if you:
- Can provide the required documents for both parents and child.
- Have children in Germany.
- Prefer ETFs or funds instead of a traditional savings account.
- Understand that the money belongs to the child.
- Want to invest long term for your child.
Before opening a Junior Depot, compare account fees, ETF savings plan options, required documents, tax treatment, custody rules, and whether the provider accepts your family’s residence situation.
Robo-Advisor Account
A robo-advisor is a digital investment service that creates and manages a portfolio for you. Instead of choosing ETFs or funds yourself, you answer questions about your goals and risk tolerance, and the robo-advisor invests according to that profile.
Robo-advisors can be useful for expats who want to invest but do not want to manage a portfolio themselves.
A robo-advisor may be useful if you:
- Are comfortable paying extra fees for convenience.
- Do not want to choose ETFs yourself.
- Prefer automated portfolio management.
- Want a hands-off investment approach.
The main downside is cost. Robo-advisors usually charge management fees on top of fund fees. Before signing up, compare total costs, investment strategy, tax handling, risk levels, and whether you can keep the account if you leave Germany.
Digital Wealth Management
Digital wealth management is similar to a robo-advisor, but it may include more tailored portfolio management, higher minimum deposits, or broader investment strategies.
This type of account may be relevant for expats with larger portfolios who want professional management without using a traditional private bank.
Before choosing digital wealth management, check:
- Exit rules.
- Investment strategy.
- Management fees.
- Minimum investment amount.
- Risk profile.
- Tax reporting.
- Underlying fund costs.
Tagesgeld Account
A Tagesgeldkonto is an instant-access German savings bank account. It is not an investment account in the same way as a broker account, but it is still one of the most important places to keep short-term money in Germany.
A Tagesgeld account is useful for emergency savings, moving costs, apartment deposits, upcoming tax payments, or money you may need within the next year.
The main advantage is flexibility. The main disadvantage is that interest rates can change over time.
Festgeld Account
A Festgeldkonto is a fixed-term savings account. You lock money away for a set period and usually receive a fixed interest rate.
Festgeld can be useful for money you do not need immediately, but it is less flexible than Tagesgeld. If you may need the money soon, a fixed-term account may not be the right choice.
Private Pension Account
Private pension products are used for retirement planning. These can include private pension insurance products and long-term investment-based pension contracts.
Private pensions can be useful for some long-term residents, but expats should be careful: Products may have long contract terms, fees, tax rules, and restrictions that are not ideal if you may leave Germany.
Before choosing a private pension product, check:
- Cancellation rules.
- Contribution flexibility.
- Payout rules.
- Tax treatment.
- Total fees.
- Whether the contract is portable if you leave Germany.
- Whether the product still makes sense if you retire outside Germany.
Company Pension / Betriebliche Altersvorsorge
A company pension, or betriebliche Altersvorsorge, is an occupational pension arranged through your employer. It can be useful for employees, especially if the employer contributes additional money.
For expats, the main questions are portability and long-term value. If you may leave Germany, check what happens to the pension, when you can access it, how it is taxed, and whether it remains worthwhile if you stop working for that employer.
Building Savings Contract / Bausparvertrag
A Bausparvertrag is a building savings contract often used by people planning to buy or renovate property. It combines a savings phase with the possibility of a future loan under defined conditions.
This product is more niche and is usually only relevant if you plan to buy property in Germany or want a specific property financing strategy.
Expats should be careful before signing a Bausparvertrag because it can be less useful if you leave Germany, do not buy property, or need flexibility.
Crypto Account or Wallet
Crypto investing usually happens through a crypto exchange, broker, or wallet. This is different from a normal German broker account, although some brokers also offer crypto products.
Crypto is high risk and can create tax documentation challenges. If you buy, sell, swap, stake, or transfer crypto, keep detailed records.
A crypto account may be relevant only if you understand the risks and can handle the tax documentation.
In Germany, crypto can have a special tax advantage for private investors under the current rules. Profits from selling privately held cryptocurrencies are generally tax-free if you hold them for more than 1 year before selling. If you sell, swap, or dispose of crypto within 1 year, gains may be taxed as private sales transactions at your personal income tax rate.
For short-term crypto gains, Germany uses a Freigrenze of €1,000 per year for private sales transactions. This is an exemption limit, not an allowance. That difference matters: if your total short-term private sales gains stay below the limit, they can remain tax-free. If they reach or exceed the limit, the entire gain can become taxable from the first euro, not only the amount above €1,000.
The 1-year crypto holding-period rule is still relevant for current 2026 tax planning, but investors should not assume it will remain unchanged forever. Political proposals have discussed aligning crypto taxation more closely with traditional investments, potentially removing the 1-year tax-free holding period and applying a flat capital gains tax model in the future. Check the current law before making crypto decisions for 2027 or later.
How to Invest Money in Germany
Before choosing an investment, decide what the money is for. Money you need soon should usually be kept safer and more accessible. Money you do not need for many years can usually take more risk.
A simple investing setup in Germany may look like this:
- Build an emergency fund: Keep enough money available for unexpected expenses.
- Separate short-term and long-term money: Do not invest money you may need soon in volatile assets.
- Open a German bank account: This helps with transfers, direct debits, German credit cards, and linking to brokers.
- Get your German tax ID: Banks and brokers may need it for tax reporting.
- Choose the right investment account: This could be a broker account, ETF savings plan, Junior Depot, robo-advisor, savings account, or pension product.
- Set up your saver’s allowance: Use a Freistellungsauftrag where applicable.
- Start with a regular plan: Many expats begin with monthly ETF investments or automated savings.
- Review your plan regularly: Adjust if your income, tax residency, family situation, or plans to stay in Germany change.
Investment Taxes in Germany
Investment taxes are one of the most important topics for expats investing in Germany. Tax rules can affect your returns, your reporting obligations, and your choice of broker.
In Germany, common investment income can include:
- Capital gains.
- Dividends.
- Fund distributions.
- Interest.
- Taxable gains from selling securities.
Crypto platforms usually do not handle German tax automatically. Keep records of purchase dates, sale dates, prices, fees, transfers, swaps, staking rewards, wallet movements, and the holding period for each transaction. If your crypto activity is complex, or if tax rules change before you sell, ask a tax advisor before filing your German tax return.
Capital Gains Tax in Germany
Investment income in Germany is generally subject to capital gains tax, known as Abgeltungsteuer. The flat capital gains tax rate is 25%. The mandatory solidarity surcharge adds 5.5% of the tax amount, bringing the basic effective rate to 26.375%. If you are registered with a church, church tax may also apply, bringing the total effective rate to approximately 27.8% to 28%, depending on the federal state.
Reference the German capital gains tax calculator for individual rates.
If you use a German broker, taxes are often withheld automatically. If you use a foreign broker, you may need to report investment income yourself in your German tax return.
Vorabpauschale on Accumulating ETFs
Germany does not only tax ETF investors when they sell shares or receive distributions. Accumulating ETFs can also trigger the Vorabpauschale, a pre-determined taxable amount based on a formula. This can feel like a tax on unrealized or “phantom” gains because you may owe tax even though you did not sell the ETF and did not receive cash.
The Vorabpauschale mainly affects accumulating funds and ETFs when the fund value increased during the year and the calculated base return is positive. Distributing ETFs can also be affected in some cases, but regular distributions may reduce or eliminate the Vorabpauschale.
If you use a German broker, the broker usually calculates and withholds the Vorabpauschale automatically. The tax is commonly debited from your broker cash account at the beginning of the following year. Expats who invest only through monthly ETF savings plans sometimes forget to keep cash available and may be surprised by a negative cash balance or broker notice.
The Vorabpauschale is not an extra tax on top of your final capital gains tax forever. Amounts already taxed through the Vorabpauschale are generally taken into account when you later sell the fund shares, so the same calculated amount should not be taxed twice. Still, it is important for cash-flow planning.
Saver’s Allowance
Germany has an annual saver’s allowance called the Sparer-Pauschbetrag. In 2026, this allows €1,000 of investment income per year to be tax-free for single taxpayers and €2,000 for married couples or civil partners filing jointly, if set up correctly.
To use this allowance with a German bank or broker, you usually submit a Freistellungsauftrag, or exemption order.
If you are single and earn €800 in taxable interest or dividends during the year, a correctly submitted Freistellungsauftrag can keep the full €800 tax-free because it is below the €1,000 saver’s allowance. Without the exemption order, a German broker may withhold tax first, and you would need to reclaim it through your tax return.
Freistellungsauftrag
A Freistellungsauftrag tells your German bank or broker to apply your saver’s allowance before withholding tax.
If you have accounts with multiple banks or brokers, you can split the allowance between them. Do not allocate more than your total available allowance across all providers.
For example, a single taxpayer could allocate €600 to one broker and €400 to a savings account provider. A married couple filing jointly could split the €2,000 allowance across several banks and brokers, as long as the total exemption orders do not exceed €2,000.
Using a Foreign Broker While Living in Germany
Some expats continue using a broker from their home country after moving to Germany. This can be possible, but it may create tax reporting issues.
A foreign broker may not automatically withhold German tax or provide German tax documents. This can make your tax return more complicated.
Before using a foreign broker, check:
- Whether currency conversion creates extra complexity.
- Whether it provides tax documents you can use in Germany.
- Whether the broker accepts German tax residents.
- Whether there are exit or account restrictions if your residence changes.
- Whether you must report income manually.
FATCA and US Expats Investing in Germany
US citizens, green card holders, and other US persons face special problems when investing in Germany. Under FATCA, foreign financial institutions may have to report accounts held by US persons, and US persons may have additional US reporting obligations even when they live in Germany.
Because of this, many German brokers, neo-brokers, and direct banks either reject US persons or restrict their investment access. This can affect popular platforms such as Trade Republic, Scalable Capital, Finanzen.net Zero, and some direct banks. A US passport, US place of birth, US tax residency, or US green card can trigger extra questions during account opening.
If you are a US person, do not assume that a German broker will accept you. Check the broker’s US-person policy before applying, and consider speaking with a cross-border tax advisor before buying ETFs, funds, or other investments from Germany.
Junior Depot Taxes
A Junior Depot can have separate tax considerations because the account belongs to the child. Children in Germany can have their own tax allowances, but families should check how investment income, health insurance, family benefits, and tax forms interact.
Before opening a Junior Depot, check whether you need a Freistellungsauftrag for the child, whether a non-assessment certificate may be useful, and whether investment income could affect other family-related rules.
Opening an Investment Account in Germany
To buy ETFs, stocks, funds, or other securities, you usually need a broker account, also called a Depot in Germany.
A broker account can be opened with:
- Direct banks.
- Online brokers.
- Robo-advisors.
- Some digital banks.
- Traditional banks.
Popular options for expats often include German online brokers such as Trade Republic and Scalable Capital, direct banks such as ING or comdirect, and specialist platforms or robo-advisors depending on your needs. German-regulated brokers can be attractive because they often handle German withholding tax automatically, but not every provider accepts every citizenship or tax residency.
When comparing broker accounts, check:
- Account maintenance fees.
- Account opening requirements.
- Available ETFs and funds.
- English support.
- ETF savings plan fees.
- Order fees.
- Tax handling.
- US-person policy if you are a US citizen or green card holder.
- Whether you can keep the account if you leave Germany.
Eligibility for Foreigners to Invest in Germany
Foreigners can generally invest in Germany if they meet the requirements of the bank, broker, or investment provider. You may need proof of identity, address, tax ID, and sometimes a German bank account.
The more important question is not whether you can invest, but which investment setup makes sense for your residence situation.
Foreigners and expats should consider:
- Account opening requirements.
- Currency risk.
- German tax residency.
- Investment taxes in Germany.
- Tax obligations in their home country.
- Whether accounts can remain open after moving abroad.
- Whether long-term products are flexible enough.
- Whether they may leave Germany.
US citizens and green card holders should be especially careful. Even if you live in Germany and have a German tax ID, many German brokers may still reject you because of FATCA and US tax reporting rules. This is one of the biggest practical differences between US expats and other foreign residents investing in Germany.
Common Investing Mistakes Expats Make in Germany
Investing in Germany is not difficult, but expats can run into problems when they copy advice from another country without checking German rules.
- Assuming crypto tax rules will stay the same: The 1-year holding-period rule should be checked again before selling in 2027 or later.
- Choosing long-term pension products too early: Some products are not flexible if you leave Germany.
- Choosing the wrong account type: A broker account, Junior Depot, savings account, pension, and crypto wallet all serve different purposes.
- Confusing trading with investing: Frequent trading can increase risk, fees, and tax complexity.
- Forgetting the Vorabpauschale on accumulating ETFs: German ETF investors can owe tax on a calculated fund return even without selling shares.
- Holding too much cash long term: Savings accounts are useful, but inflation can reduce purchasing power over time.
- Ignoring German tax rules: Investment income may need to be taxed or reported in Germany.
- Investing before building an emergency fund: Short-term money should usually stay accessible.
- Keeping no cash in the broker settlement account: German brokers may debit ETF tax from the linked cash account at the start of the year.
- Misunderstanding the crypto Freigrenze: The €1,000 short-term private sales limit is not an allowance; crossing it can make the entire gain taxable.
- Not checking FATCA restrictions: US citizens and green card holders may be rejected by many German brokers.
- Not setting up the saver’s allowance: A Freistellungsauftrag can prevent unnecessary tax withholding at German banks and brokers.
- Opening a Junior Depot without understanding ownership: Money in a Junior Depot belongs to the child, not the parents.
- Taking too much risk with short-term money: Money needed soon should not usually be invested in volatile assets.
- Using a foreign broker without tax documents: This can make your tax return more complicated.
For many expats, the most practical setup is a current account for everyday banking, a savings account for emergency money, a broker account or ETF savings plan for long-term investing, and specialized accounts only when they fit your situation.
Conclusion
The best investment option in Germany depends on your timeline, risk tolerance, tax situation, account type, and long-term plans. Expats should be especially careful with portability, foreign brokers, tax reporting, Junior Depots, FATCA restrictions, ETF pre-tax rules such as the Vorabpauschale, and products that are difficult to cancel after leaving Germany.
A simple approach is often best: keep short-term money safe, use flexible savings accounts for emergency funds, and consider diversified long-term investments such as ETFs only when you can leave the money invested for several years.
For many expats, the most practical setup is a German current bank account for everyday banking, a savings account for emergency money, a broker account or ETF savings plan for long-term investing, and specialized accounts such as a Junior Depot, pension, or business-related account only when they fit your situation.
Frequently Asked Questions
There is no single best investment for every expat. Short-term money is usually better kept in savings products, while long-term money may be suitable for ETFs, funds, pensions, or property depending on your goals and risk tolerance.
Start by building an emergency fund, opening a bank account, getting your tax ID, choosing the right investment account, and deciding whether you want short-term savings or long-term investments.
Common investment accounts and products include broker accounts, ETF savings plans, Junior Depots, robo-advisor accounts, Tagesgeld accounts, Festgeld accounts, private pensions, company pensions, Bauspar contracts, and crypto accounts.
For short-term money, many people use Tagesgeld or Festgeld. These are usually more suitable for near-term goals than stocks, ETFs, or crypto.
Lower-risk options include savings accounts and fixed-term deposits. However, lower risk usually means lower return potential.