Germany proposes to pay schoolchildren €10 monthly and the profit from investing this money as an “early pension”

Income tax will not be levied until retirement. 

• It is proposed to accrue an early pension for students aged six to 18 into a special account, writes CNBC. Over their entire period of study, they could accumulate around €1500.
• They plan to finance the program using state fund budgets. Who will be responsible for investing the money deposited into the accounts, what instruments they plan to invest in, and what the potential accumulated sum with interest might be by retirement – is currently unknown.
• After reaching adulthood, a German citizen will be able to transfer personal funds to the account, among other things, within annual limits. However, withdrawing the money will only be permitted upon reaching retirement age.
• German authorities expect that the measure will provide future pensioners with starting capital and also help increase the awareness of the young population regarding savings and investments.
• Some experts surveyed by CNBC believe that the final amounts will be symbolic and are not confident that this program will increase the level of financial literacy among young people, as they will only passively receive money and interest. Investment decisions will be entrusted to third parties.

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