How can I get started with expat finances in Germany on my own?

We've created a comprehensive Expat Checklist that covers everything you need to know when settling in Germany, from banking to insurance to retirement planning. It's completely free and a perfect starting point.

What's the difference between public (GKV) and private (PKV) health insurance in Germany?

Public insurance (GKV) offers family coverage and income-based premiums, while private insurance (PKV) can offer better benefits at lower costs for high earners. The right choice depends on your income, employment status, and family situation.

Should I contribute to the German pension system or invest privately?

It depends on your plans. If you're staying long-term in Germany (5+ years), the German pension system offers solid benefits. For shorter stays, private investment strategies might be more flexible.

Do I need to speak German to work with Expat Heroes?

Not at all! Our entire team is fluent in English, and all our services, documentation, and communication are available in English. We specialize in helping English-speaking expats navigate the German financial system.

What insurances are mandatory in Germany?

Health insurance is mandatory for everyone in Germany. Private liability insurance (Haftpflichtversicherung) is highly recommended. The right mix depends on your employment status, family situation, and lifestyle.

Can Expat Heroes help me with my taxes?

We are not licensed tax consultants, so we cannot provide tax advice directly. However, we can refer you to a trusted tax consultant who can help.

How much does the Expat Heroes consultation cost?

Our consultancy appointments are completely free of charge. Our consultants are compensated through a mandatory commission paid by the companies and providers we recommend, so you receive expert guidance at no direct cost.

How much money should I save as an expat in Germany?

A common rule of thumb is to save at least 20% of your net income. But the right amount depends on your goals, lifestyle, and how long you plan to stay in Germany.

What is a financial advisor for expats and why do I need one?

A financial advisor for expats understands the decisions that come with an international life: what happens to your contracts if you leave Germany, which products work across borders, and which ones you are better off not signing. An expat financial advisor ensures you don't miss opportunities or make costly mistakes, all in English.

How does inflation affect my savings in Germany?

Inflation reduces the purchasing power of your money over time. Even at moderate rates, your savings could lose significant value if left in a low-interest bank account.

What is the retirement gap and how do I calculate it?

The retirement gap is the difference between what you'll receive from the German state pension and what you actually need to maintain your lifestyle in retirement. Many expats are surprised by how large this gap can be.

What should I know about investing as an expat in Germany?

As an expat, you have access to a wide range of investment options in Germany, from ETFs and funds to pension-linked products. The key is to choose a strategy that aligns with your goals, risk tolerance, and time horizon.

How do I find out which insurances I actually need in Germany?

Germany has many types of insurance, some mandatory, some optional but highly recommended. The right mix depends on your employment status, family situation, and lifestyle. A free Insurance Check can give you a clear overview.

ETF Investing for Expats in Germany: A Beginner's Guide

Why ETFs Are Perfect for Expats

Exchange-Traded Funds (ETFs) are the most popular investment vehicle for expats in Germany, and for good reason:

Low costs: Average fees of 0.1-0.3% per year (vs. 1-2% for actively managed funds)
Global diversification: One ETF can give you exposure to thousands of companies worldwide
Full liquidity: Buy and sell anytime, no lock-in periods
Portability: Unlike some German pension products, ETFs travel with you if you leave Germany
Transparency: You always know exactly what you're invested in
Automation: Set up a Sparplan (savings plan) and invest automatically every month

See how your investments grow over time with our compound interest calculator.

Getting Started: Choosing a Broker

To invest in ETFs in Germany, you need a "Depot" (brokerage account). Here are the main options:

Neo-Brokers (Low Cost)

Trade Republic: Very popular, €1 per trade or free Sparplan
Scalable Capital: Free Sparplan, competitive pricing
Smartbroker+: Wide selection, low fees

Traditional Banks with Depot

ING: Good English support, user-friendly
Comdirect/Commerzbank: Wide selection, higher fees
DKB: Solid all-rounder

What Expats Should Consider

English interface: Trade Republic and Scalable offer English
Tax reporting: German brokers handle Abgeltungssteuer automatically
International brokers (Interactive Brokers, etc.): More complex tax filing required

> Important: Using a German broker simplifies your tax situation enormously. The broker automatically deducts and reports capital gains tax (Abgeltungssteuer), no extra paperwork needed.

Understanding German Investment Taxation

Germany has specific rules for investment taxation that expats should understand:

Capital Gains Tax (Abgeltungssteuer)

Flat rate of approximately 26.4% on all investment gains (25% + solidarity surcharge)
Automatically deducted by German brokers
Annual tax-free allowance (Sparerpauschbetrag) per person for singles, double for married couples filing jointly

Teilfreistellung (Partial Exemption)

This is a significant benefit for equity ETF investors:

Equity ETFs (>51% stocks): 30% of gains are tax-exempt
Mixed ETFs (>25% stocks): 15% tax-exempt
Bond/Other ETFs: No partial exemption

This effectively reduces the tax rate on equity ETF gains substantially.

Vorabpauschale (Advance Lump Sum)

A small annual tax on unrealized gains, calculated based on a base rate. German brokers handle this automatically, you just need sufficient cash in your account at the start of each year.

For a broader view of how these fit into your financial picture, see our retirement planning guide.

Building Your ETF Portfolio

A simple, effective portfolio for expats:

The One-ETF Solution

A single world ETF (like those tracking the MSCI World or FTSE All-World index) gives you exposure to thousands of companies across developed and emerging markets. This is the simplest possible approach and works very well for most investors.

Core-Satellite Approach

Core (80-90%): Broad world ETF
Satellite (10-20%): Thematic or regional ETFs (e.g. emerging markets, technology, sustainability)

Setting Up a Sparplan

A Sparplan is an automated monthly investment plan:

Choose your ETF(s)
Set a monthly amount (starting from as little as €25)
Pick a day of the month for execution
The broker buys automatically, no manual trading needed

This "set and forget" approach removes emotion from investing and leverages euro-cost averaging.

Use our inflation calculator to see why keeping money in a savings account isn't enough.

ETF vs. Fondsgebundene Rentenversicherung

Many expats wonder whether to use an ETF Depot or a fondsgebundene Rentenversicherung (unit-linked pension insurance). The answer: often both.

	ETF Depot	Fondsgebundene Rentenversicherung
Tax during accumulation	~26.4% on gains/dividends annually	None
Tax at payout	~26.4% Abgeltungssteuer	Only partial taxation (e.g. 17% at age 67)
Flexibility	Very high, sell anytime	Medium, best after 12+ years
Costs	Very low (0.1-0.3% TER only)	Higher (0.3-0.8% wrapper fee + fund costs)
Best for	Medium-term goals (5-15 years)	Long-term retirement (15+ years)

The optimal strategy for most expats: Use an ETF Depot for medium-term flexibility and a fondsgebundene Rentenversicherung for tax-optimized long-term retirement savings. Read more in our retirement planning guide.

Ready to start investing? Start a no-obligation conversation with us to get a personalized investment strategy for your situation.