How we calculate — and how we are paid
Every figure on this site, with the working behind it
- Every assumption disclosed — verifiable, not asserted
- Two return scenarios instead of one wishful number
- When the policy holds more than you paid in
How do you spot honest financial advice?
By three things you can check. First: the assumptions are stated. A projection without a return assumption, a term and a cost model is not a calculation, it is a number. Second: the costs are on the table before you sign — including the ones from the start-up phase. Pay 100 € a month and after the first year the contract holds 911 € rather than 1,200 €, because the acquisition costs are front-loaded into the first five years. Third: the remuneration is named. We are paid by the product provider, not by you.
This page does all three for our own figures. The numbers come from the same code that powers the calculators on this site.
Past performance is not a reliable indicator of future results. Investments carry risk.
What assumptions do we calculate with?
Without these, any projection is worthless. So they come first — before the results.
- Monthly amount: 150 €
- Child’s age at start: 0 years
- Term: 18 years
- Return assumption: two scenarios, 9.7 % and 6.0 % per year, each before costs
- Cost model: ongoing ETF charges 0.4 % p. a., administration 6.3 % of the annual premium, fixed charge 24 € p. a., acquisition costs front-loaded into the first five years
- Source of the cost model: Alte Leipziger tariff, as at 10 December 2025 — the same calculation we show in the meeting
What this calculation does not cover: your personal tax situation, changes to the premium over time, and withdrawals. Those can only be modelled honestly case by case.
What do those assumptions produce?
Both scenarios, side by side. In every case the same 32,400 € is paid in.
| Option | After 18 years |
|---|---|
| Savings account (0.1 % p. a.) | €32,695 |
| ETF4Kids policy, 6.0 % scenario | €46,870 |
| ETF4Kids policy, 9.7 % scenario | €68,166 |
Why our figure is smaller than the one you see elsewhere. Run the same 9.7 % without costs and you get €87,763 — which is how many comparison tools calculate. That gap of roughly €19,600 is exactly what costs amount to over 18 years. We would rather show the smaller number that holds up.
Illustrative model calculation assuming a constant rate of return. Not a forecast and not a promise.
Why do we calculate with 9.7 per cent?
Because it is the long-run average return of the MSCI World over decades, crises included — the figure Finanztip, among others, reports for long investment horizons. It is a historical mean, not a wish.
We still show 6.0 % next to it. A historical average says nothing about the next 18 years, and planning only on the higher figure leaves no buffer. In the 6 per cent scenario 32,400 € paid in becomes 46,870 € — a result you can plan with too.
If someone quotes you a single number without saying where it comes from and what happens if things go worse: ask.
Run it with your own numbers
Change the amount and the age — the calculation follows.| Age | Amount paid in | Bank / Consultant | ETF4Kids |
|---|---|---|---|
| 18 | |||
| 25 | |||
| 35 |
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.
When does the policy hold more than you paid in?
The acquisition costs are front-loaded into the first five years. During this start-up phase the policy therefore holds less than you paid in. From year six those costs drop by around 90 % and the capital catches up with what you paid in. Both phases belong together — so we show them together.
| After | Paid in | In the policy | Difference |
|---|---|---|---|
| 1 year | €1,200 | €911 | −€289 |
| 2 years | €2,400 | €1,907 | −€493 |
| 3 years | €3,600 | €2,995 | −€605 |
| 5 years | €6,000 | €5,484 | −€516 |
| 6 years | €7,200 | €7,175 | −€25 |
| 10 years | €12,000 | €15,664 | +€3,664 |
Based on €100 a month. The acquisition costs are spread over the first five years. From year six they drop by around 90 %, and by the end of year six the capital is level with what you paid in — from there compounding works for you, as the last row shows.
How to read the start-up phase: it is the price of planning long term. That is why we walk through it with your own figures in the strategy call, before you sign anything. A brokerage account does not have this phase — but there every switch triggers tax, and you have no say over when your child takes over. Which works out cheaper depends on your time frame.
So this is our rule: if you expect to pull out after three years, a brokerage account serves you better — and we say so in the call.
So why not simply a brokerage account?
We also arrange ETF brokerage accounts. For your child’s money we usually still do not recommend one. Not because we do not care about the last decimal of return, but because it is not the deciding question. What matters is that the money is put to work properly: that it stays together until the handover, that you decide when that happens, and that switching funds along the way does not cost tax. Where a brokerage account is the better solution — for short time frames, say, or for your own savings — we say so in the call and set it up.
How do we make money?
We are paid by the product provider, not by you. We do not invoice for advice, and no additional cost arises for you — the remuneration is part of the product costs disclosed above.
The conflict of interest in that is real and we do not pretend otherwise: whoever is paid through a product has an interest in it going ahead. What we can set against it are checkable things — costs on the table before you sign, saying plainly when a product is not worth it, and holding licences under § 34d, § 34f and § 34i GewO under the supervision of IHK Region Stuttgart.
What happens to the money if someone goes under?
The product pages carry the short version. This is the long one — with the qualifications that belong to it.
Three parties could fail, and a different rule applies to each.
1. The fund company fails
A depositary holds the fund assets, separately from the fund company’s own. If it becomes insolvent, those assets stay outside its insolvency estate. This separation is harmonised across the EU through the UCITS Directive and applies to every UCITS fund.
Why we do not write “Sondervermögen under § 92 KAGB”: that provision covers domestic — German — investment funds. The ETF we use for our figures, the iShares Core MSCI World, ISIN IE00B4L5Y983, is an Irish UCITS. The protection exists; the German provision is simply not the right basis for it. Many providers cite it anyway.
2. The insurer fails
Worth knowing, because it is often shortened: in a unit-linked policy the insurer holds the fund units, not you. You hold a claim against the insurer, and its value follows the value of the units.
That is why the second level matters: the assets backing unit-linked contracts sit in the Anlagestock, a ring-fenced division of the Sicherungsvermögen (§ 125 (5) VAG). In an insolvency, policyholders are paid from it first.
3. Even that is not enough
Then Protektor steps in, the guarantee fund of German life insurers. It takes over the contracts of a failed insurer and continues them.
The qualification that belongs to it: Protektor covers life insurers based in Germany. Policies from Liechtenstein or Luxembourg — not unusual for ETF policies — are not covered. We only broker insurers based in Germany. Ask about it anyway; you should hear the answer from anyone who offers you a policy.
This explains the mechanism; it is not legal advice. What governs are the terms of the individual contract and the statutory provisions as they stand.
What we do not do
- No return promises. We show model calculations with disclosed assumptions. Nobody knows the return of the next 18 years.
- No tax advice. We explain how taxation works in principle. Whether a Nichtveranlagungsbescheinigung makes sense in your case belongs with a tax adviser.
- No legal advice on inheritance, family or social law.
- No signing in the first meeting. The Clarity Call is there to sort out where you stand.
- No products we cannot explain ourselves. If we cannot make a construction clear in three sentences, we do not arrange it.
Where our statements end
Every figure on this site is a model calculation assuming a constant rate of growth. It is neither a forecast nor a promise. Past performance is not a reliable indicator of future results, and investments carry risk up to total loss.
The reviews we show come from Google and ProvenExpert. We do not ourselves carry out a formal authenticity check within the meaning of § 5b (3) UWG — the platforms are responsible for their own procedures.
This page does not replace individual advice. It exists so you can follow how we arrive at our numbers.
Common questions about costs and pay
Does advice from ETF4Kids cost anything?
No. We are paid by the product provider, not by you. There are no additional or hidden costs beyond the product costs we show before you sign.
Why is there less in the contract than I paid in during the first year?
Because acquisition costs are spread over the first five years. At 100 € a month the contract holds 911 € after one year instead of 1,200 €. From year six those costs drop by around 90 %, and by the end of year six the capital is level with what has been paid in. We run the numbers for your own savings rate together in the strategy call. If you want to exit early, a securities account suits you better.
Do you also offer a normal brokerage account?
Yes, we also arrange ETF brokerage accounts. For children we usually recommend the ETF policy, because you keep control until the handover and switching funds does not trigger tax. For short time frames or your own savings, a brokerage account can be the better choice. We work out what fits in the strategy call.
Why do you calculate with 9.7 per cent rather than less?
9.7 % is the long-run average return of the MSCI World over decades, crises included. We always show a 6.0 % scenario alongside it, because a historical average says nothing about the next 18 years. From 32,400 € paid in, the 6 per cent scenario produces 46,870 € and the 9.7 per cent scenario 68,166 €.
Where do your cost figures come from?
From the Alte Leipziger tariff, as at 10 December 2025 — the same calculation we show in the meeting. The logic sits in the same code that powers the calculators on this site.
Do you earn more if I save more?
Yes, the remuneration depends on the premium. That is why we point the link out ourselves. What we set against it: in the meeting we also say when a lower amount, or no contract at all, is the better decision.
Run it through with us — with your numbers
45 minutes, free, no signing in the meeting. You take the calculation home with every assumption in it.
Book a free Clarity Call