If you want to know which home savings provider offers the best conditions, you can immediately compare the current offers in the Immobilien-Erfahrung home savings calculator.

Building savings contract for young people: saving for housing projects

Whether a building savings contract is interesting for you as a young person depends on various factors, such as your financial possibilities and future plans. A building savings contract can be useful if you plan to buy a property or carry out renovation work. By taking out a building savings contract, you can save money over a fixed, longer period of time that you can use for these purposes.

Home savings for young people at a glance:

• Saving early for housing projects later
• Also useful if there are no concrete plans
• Financial cushion for unforeseen events

A building savings contract can also be useful if you don’t have any concrete plans yet, but you want financial security for the future. By taking out a building savings contract, you can build up a financial cushion that provides financial security in the event of unforeseen events.

Youth bonus: Offers and discounts

Some Bausparkassen offer special rates or discounts specifically for young customers, known as “youth bonuses”. These offers may vary from one Bausparkasse to another and may include, for example:

• Increased repayment subsidies when contracts are signed
• Lower minimum deposit amounts
• Special conditions for housing finance
• Discounts on other insurances

However, there is no universal youth bonus in Germany. It is advisable to compare and check the various offers and providers.

Age recommendation: building savings under 18 years of age

As a rule, you can take out a home savings contract from the age of 18. However, there are also offers from building societies that are aimed at young people under 18. In such cases, the contracts are usually signed by the parents or guardians. The parents also pay the premiums.

There are several reasons why it can make sense for parents to take out a building savings contract for their children.
Reasons for concluding a building savings contract before the age of 18:

• Support future planning
• Financial support
• Build a solid financial base
• Lower repayment rates for later projects
• Formation of savings and redemption discipline

It can be difficult for young people to save regularly and think about the future. A home savings contract can help develop a savings and repayment discipline early on and get them used to regular savings behavior.

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6 tips for young building savers and those who want to become one

If you want to take out a home savings contract, there are many things you should consider. In this checklist, you’ll find our top 6 tips for young home savings customers and those interested in home savings.

Our tips:

1. Compare conditions before signing
2. Date of completion
3. Consider residential earmarking
4. Consider contract duration (long-term commitment)
5. Compare costs of the contract
6. For questions: Advice from experts

Conditions: It is important to compare the offers of different building societies to find the best offer for your own situation. In doing so, the conditions such as redemption subsidies, interest, acquisition and administration costs as well as the services offered should be taken into account.

Time of conclusion: It is advisable to conclude a building savings contract early in order to benefit from the advantages of long-term savings and repayment.

Earmarking: The building savings contract is usually tied to a specific purpose, primarily for financing a home, it is important to ensure that the contract meets one’s wants and needs.

Contract duration: Building savings contracts usually have a longer duration of 15-25 years, it is important to note that you are committed to paying monthly contributions in the long term and take into account possible changes in your financial situation.

Cost: It is important to fully understand the risks and costs of the contract to ensure that you benefit financially from the contract in the long run.

Advice: It is advisable to seek advice from a financial advisor before taking out a building savings contract to ensure that the contract meets your needs and that you understand all the risks and costs.

Are you interested in a building savings contract? Compare immediately current conditions for your building savings contract in the Immobilien-Erfahrung.de building savings calculator.

Fees for the building savings contract

How much does building savings cost? When concluding a bauspar contract, various fees are incurred that must be taken into account in order to enable a realistic cost calculation. These can include, among other things, acquisition and management fees, costs for insurance or processing fees for loans from the bauspar loan.

An overview of possible fees:

1. Connection fee
2. Annual contributions
3. Account management fees
4. Processing fees
5. Early repayment fee

In addition to these fees, other fees may apply depending on the provider. Now you can find out what the fees are and when they apply.

Connection fee

Some building societies charge what is known as a closing fee when a building savings contract is concluded. The fee may vary depending on the provider and tariff. The closing fee is used to cover the costs incurred in setting up the contract, such as preparing contract documents, carrying out credit checks and processing applications.

The connection fee at a glance:

• Contract setup fee
• E.g. for contract documents or credit check

In some cases, these fees are not charged or are already included in the contract terms.

Annual contributions

In order to maintain a building savings contract, many building societies charge annual contributions. The annual contribution is used to cover the costs of managing and operating the contract as well as the interest on the saved capital. Some providers charge lower contributions if you pay in a larger investment amount or choose a longer term, while others charge higher contributions if you pay in a smaller investment amount or choose a shorter term.

The annual fee summarized:

• To maintain the building savings contract
• Annual payment from saver to building society
• Amount depends on various factors

Account management fees

Account maintenance fees are incurred annually or quarterly and are used to cover the costs incurred in administering the contract, such as preparing statements, making transfers, and processing inquiries. The amount of the account management fees varies depending on the provider and the contract.

Use of the account management fee:

• Preparation of accounts
• Execution of transfers
• Inquiry processing

Account management fees for home savings contracts are controversial. In a ruling from 2022, the Federal Court of Justice (BGH) issued a decision on the charging of account management fees for home savings. However, it is currently only valid for customers of BHW Bausparkasse. Some home savings banks therefore do not charge this fee.

Handling fee

Processing fees are mainly incurred in the event of changes to the contract. During the savings phase, you have the option of adapting the contract individually to your circumstances.

Processing fees may apply for:

• Changes to the contract (term, savings target, amount of installments)
• Conducting audits or reviews in connection with the contract
• Preparation of certificates or proofs

The amount of the processing fee varies depending on the provider and can range from a few euros to several hundred euros.

Early repayment fee

The early repayment penalty is also known as a disbursement fee. It is due if you terminate a home savings contract prematurely before the agreed term has expired. It serves to compensate the provider for the lost interest and repayments that he had expected if the contract had remained in force until the end of the term.

Fees apply in the event of premature termination of the contract.

Conclusion and tips for those interested in building savings

It is important to be aware of the provider’s fee structure before signing a home loan contract. You should make sure that you take into account the cost of any additional services to be sure that you choose the offer that best suits your personal needs and goals. Comparing the terms of different providers and contracts can help you make the best choice.

Here are our tips that people interested in building savings should consider before signing a contract:

• Find out about the provider’s fee structure and take this into account in your cost calculation
• Compare the offers and conditions of different providers to make sure you get the best deal for your needs