Saving for children: How parents properly invest money for children

Image source: © Adobe Stock / Text: Verivox

the essentials in brief

• The money that children save themselves to finance larger purchases is best invested as overnight money.
• When saving for several years to a big goal with a fixed date – such as a moped or a driver’s license – time deposits are the right investment for children and young people.
• Large monetary gifts are best invested by parents in a mix of time deposits and high-yielding investments such as stocks or funds. Cheap index funds (ETFs) are particularly suitable.
• If grandparents, godparents or the parents themselves regularly save money for children, a fund savings plan is particularly suitable.
• Low costs, more returns – pay attention to favorable conditions when choosing your financial products and your securities account.

+++ This guide is updated regularly. The following information corresponds to the current status in October 2019. Subsequent developments have not yet been taken into account +++

Many parents regularly put some money back for their children. Grandparents, aunts and uncles or the godfathers also often contribute to the wealth accumulation of a child with larger monetary gifts. Parents are therefore faced with the question of which investment is particularly suitable for children. Those who pay attention to high interest rates and an attractive return get more out of the money saved. The savings book should have been used as the sole facility. Interest rates there are usually lower than inflation. So the rising prices eat up part of the money. We explain what you should pay attention to when saving for children and how you can introduce your children to responsible use of money.