Early Start Pension

Germany's Early Start Pension from 2027: €10 a Month per Child — and What It Won't Cover

From 2027 the state invests €10 a month in ETFs for every child. The catch: the money is locked until 65.

Written by Erol Eren, Founder and Managing Director, B.Sc. Economics · 24 September 2026

New from 2027

From 2027, Germany will for the first time subsidise ETF saving for children: €10 a month from the 6th to the 18th birthday, invested in the markets rather than parked in a savings account. It is a long-overdue step.

The catch is in the name: the Frühstartrente is a pension. For a child born in 2020, the money becomes available in 2085. Their driving test is due in 2037.

In two minutes you will know whether your child qualifies, what the early start pension does — and what you need to sort out yourselves for the decades before.

In short

The early start pension in 30 seconds

For every child born in 2020 or later, the state pays €10 a month into a pension depot from their 6th to their 18th birthday, €1,440 in total. The money goes into funds, usually ETFs. It stays locked until the 65th birthday, so it is not meant for driving lessons, university or a first flat.

Starts on 1 January 2027, first for children born in 2020 and 2021
No application needed — your child's tax ID is enough
Costs capped at 1% a year, no set-up fees until 18
Children born in 2019 or earlier get nothing, and there is no back pay

€ 10

from the state every month

no contribution needed from parents

144

months of funding

from the 6th to the 18th birthday

€ 1,440

per child in total

invested in funds, usually ETFs

at 65

the earliest payout

nobody can touch the money before then

Government draft bill approved by the Federal Cabinet on 12 August 2026. It still needs to pass the Bundestag and Bundesrat.

Birth-year check

Does your child qualify for the early start pension?

Only the year of birth matters. Move the slider to your child's birth year.

What year was your child born? 2021

Yes — your child qualifies: from 2027 to 2039 the state pays in €1,440 in total. The earliest payout is in 2086.

Total from the state: €1,440; €10 a month, from age 6 to 18
Available at 18: €0; Driving lessons, university, a first flat: this money is not meant for any of that
Available from: 2086; the year your child turns 65

Children born in 2020 and 2021 start in January 2027, with one more birth year added each year after that. For the 2020 cohort, payments are backdated to 1 January 2026. If you have children born both before and after 2020, they will not get the same amount — something you can even out with your own savings plan.

As per the government draft of 12 August 2026. Details may still change as the bill goes through parliament.

The catch

Locked until 65:
A gift for retirement, not for the years before

The state's €10 a month and everything it earns are locked until the 65th birthday. That is how the law is designed.

By the 18th birthday, the pot would be worth around €2,200 on paper. Even if the money were available, it would not cover a driving licence:

State money up to the 18th birthday

1.440 €

Depot value at 18 (model calculation)

2.200 €

Driving licence today — ADAC's lowest estimate

3.500 €

State money up to the 18th birthday	1.440 €
Depot value at 18 (model calculation)	2.200 €
Driving licence today — ADAC's lowest estimate	3.500 €

Depot value: illustrative model calculation by the German government assuming 7% growth a year; not a forecast or a promise. Driving licence: ADAC estimate of €3,500 to €6,000.

For retirement, though, the early start pension is a real win: if the roughly €2,200 stays invested until 65, the same model turns it into well over €50,000. Just not before then.

The years before

What will your child need before their 65th birthday?

Tick what you would like to make possible for your child. The early start pension covers none of it — the amounts are current German averages.

Driving licence Class B, €3,500–6,000 according to the ADAC 4.500 € First car second-hand, realistically priced 8.000 € University or vocational training around €1,000 a month in living costs for three years 36.000 € Year abroad school year abroad including travel 12.000 € First flat deposit, furniture, moving 6.000 €

That adds up to

48.500 €

Almost all of this comes up between 18 and 25. For that you need a second pot — one that you as parents control.

Ballpark figures: ADAC estimate of driving licence costs, Deutsches Studierendenwerk on student living costs. As of 2026.

The second pot

Early start pension, junior depot or ETF policy:
Who decides when the money is used?

For the years before retirement, many families use an ETF savings plan inside an insurance wrapper, known as an ETF policy. The money goes into the same broadly diversified funds — but the contract is in a parent’s name, with the child as beneficiary.

Vergleich
	Early start pension State money for retirement	Junior depot In the child's name	Parents stay in control Parents' ETF policy With the child as beneficiary
Contract holder	The child, as a standard depot contract	The child	One parent, with the child as beneficiary
Money available	From age 65 at the earliest	Any time, but it is the child's own money	Any time, in full or in part
Who decides from 18	Nobody — the money stays locked	The child alone	You as parents — you decide when your child gets how much
Signature needed from	No application, the provider registers the contract	Both parents if custody is shared	One parent
Contributions and top-ups	Top-ups of up to €6,840 a year, also locked	Freely chosen	From €25 a month, raise, lower or pause any time
State funding	€10 a month from the 6th to the 18th birthday	None	None of its own — but it works alongside the early start pension
Designed for	Your child's retirement	Assets that belong to the child	Driving licence, university, a first flat — or later your child's own pension

The early start pension and your own savings plan are not either-or. Most families take the €10 and build the second pot alongside it.

What your own savings plan can build by 18

Set the monthly amount and your child's age — the numbers update instantly.

Age	Amount paid in	Savings account	ETF savings plan
18
25
35

Amount paid in

Savings account (1%)

ETF savings plan (model) (7%)

Illustrative model calculation based on an assumed, constant rate of return. It is neither a forecast nor a promise. Past performance is not a reliable indicator of future results. Investments involve risk.

An example: €50 a month over 18 years grows to around €21,000, of which €10,800 was paid in. Model calculation assuming 7% a year, before costs and taxes — not a forecast or a promise, and losses are possible.

Separated parents

A contract only one parent needs to sign

For many mothers, this is what tips the balance: with a policy in your own name, your own signature is enough — however custody is arranged.

A junior depot in the child's name is different: with shared custody, both parents have to sign when it is opened and often for every change after that. If you can no longer sit down at the same table as your ex, you are stuck before the first euro is saved.

The early start pension on BUNTE.de

On 16 September 2026 we also explained the early start pension on BUNTE.de, one of Germany’s best-known lifestyle magazines: what it does, which children miss out and what parents can do about the years before.

The article is in German and is labelled there as an advertisement by ETF4Kids GmbH.

Read the article on BUNTE.de

Checklist

What to do now

Four things you can already take care of today.

Claim the €10

From 2027 you can open a standard depot contract for every child born in 2020 or later.

Until then, all you need is your child's tax identification number to hand. And if you do not open a contract, the €10 is not lost: the state invests it collectively through the Bundesbank.

Work out the costs before retirement

Once you know what is needed and when, you can set the monthly amount that covers it from today.

Driving licence, university, a deposit: over 18 years, the monthly amount you need is usually smaller than you think. The calculator above is a good place to start.

Diversify broadly

A single global ETF holding thousands of companies makes more sense for a child than three trendy themes.

Many trends are forgotten within five years. A broad global ETF tracks entire markets — exactly what a child’s savings plan needs over 18 years.

See the costs before you sign

For every product — standard depot, junior depot or policy.

An adviser who compares several providers and discloses all costs is worth more than a bank adviser with one product on the shelf. We compare 21 providers and go through the numbers openly with you in the first call.

children already have a savings plan set up with us

Claim the early start pension — and set up the second pot properly

In a free first call we go through both with you: what the €10 does and what you need for the years before. By video, in English or German, evenings too.

Book your free first call

FAQ

Frequently asked questions about the early start pension

When does the early start pension start?

The plan is 1 January 2027, first for children born in 2020 and 2021. For the 2020 cohort, payments are backdated to 1 January 2026. From 2028, one more birth year is added each year.

Which children miss out?

All children born in 2019 or earlier. There is no back pay. For them, it all comes down to what their parents put aside.

Do I have to apply for it?

No. You open a standard depot contract with a provider, and the provider registers it. All you need is your child's tax identification number. Without a contract, the state invests the €10 collectively through the Bundesbank.

Can grandparents pay in?

Yes. Parents, grandparents and others can top up by up to €6,840 a year in total. These top-ups are not tax-deductible, and this money is also locked until 65.

Is the early start pension enough for a driving licence?

No. The state money is locked until the 65th birthday. For anything before then, you need your own flexible savings plan.

Has the early start pension been passed yet?

Not finally. The Federal Cabinet approved the government draft on 12 August 2026; it still needs to pass the Bundestag and Bundesrat. Details may change until then.

Can I combine it with my own savings plan?

Yes, and for most families that is the sensible route: take the state’s €10 for retirement and build your own savings plan for the years up to 25 alongside it — one that you control.

As of September 2026. The early start pension (Frühstartrente) is based on the government draft approved by the Federal Cabinet on 12 August 2026; it still needs to pass the Bundestag and Bundesrat. All model calculations assume constant growth of 7% a year. They are not a forecast or a promise, and investments carry risks. Driving licence costs: ADAC estimate. This is not individual tax or legal advice.