The Riester pension has prevailed with approximately 12.5 concluded contracts in all its variants as the product on the retirement pensions market. The Riester pension becomes the Renner: after details of the financial industry in Germany approximately 12.5 million old age pension contracts maintained, that match the criteria of the Riester. The huge response is likely due to the increased awareness in the population of the need for a private supplementary pension. The Riester pension is designed to complement the services of the statutory pension insurance and establishes incentives that go since the introduction of the residential Riester also in the area of construction of own real estate investments through grants and tax benefits. Riester contracts can be completed by anyone who is employed or basically pension resident. Who pays four percent of its social insurance contributions gross income (maximum 2100 euros) per year in the contract, thus gain full entitlement to the allowance.
These consist of the basic allowance in Height of 154 Euro annually, as well as the allowance of 185 euros a year. Who is younger than 25 years at the conclusion of the contract, receives once more 200 euros. The deposits can be claimed up to 2100 euros (net of allowances) as special income tax. Riester contracts can both based on a Banksparplan and an investment fund. In the latter version the repayment must ensure however on the part of the provider, where the contract is concluded, at least the paid amounts to the end of the term. This in the past has already led to problems: to ensure the capital guarantee, insurance companies and banks of Riester contracts in the wake of the market crash coated to 2008/2009 from equities into bonds.
The thus realized losses are now significantly lower yield expectations. The payout phase of Riester contract can be done with the age of 60. Maximum 30 percent of the contract balance available at retirement can as unique Lump-sum settlement be paid out, the police in the form of a lifelong monthly pension pays the rest. An advantage that private pension insurance is legally guaranteed seizure protection Riester-rente over: The contract credit flow at a possible insolvency of the contract owner not in the insolvency assets with a, but are preserved. The same applies if during the accumulation phase an application for ALG II.