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How to manage your finances in Germany after removals?

| Anna |

How do I manage my finances in Germany after moving?

Savings and investment accounts

There are many different types of savings and investment accounts available in Germany. It’s worth taking a look at what’s on offer to maximise your savings returns. Many banks also offer savings accounts with a bonus, which can bring additional benefits.

Credit and loans in Germany

Germany has an extensive credit system. If you ever need a loan to buy a property or a car, it is a good idea to find out about the Schufa beforehand. This is the German equivalent of a credit history. A good score is crucial if you want to get a loan in Germany.

Payment cards

Debit cards (EC-Karte) are widely used in Germany. Credit cards are not as popular as in other countries, but are accepted in most places.

German supplementary insurance

In addition to the compulsory health insurance, there are other important insurances such as:

* Haftpflichtversicherung (third-party liability insurance) – protects against claims by third parties in the event of damage to them.

* Hausratversicherung (property insurance) – protects household possessions against theft, fire or other accidents.

* Berufsunfähigkeitsversicherung (incapacity insurance) – pays a benefit if you are unable to work due to illness or accident.

Car insurance when you move to Germany

If you plan to buy a car in Germany, you also need to think about insurance. In Germany, third-party liability insurance is compulsory, but you can also consider additional insurance.

Pensions in Germany

It is worth understanding the German pension system (Rentenversicherung). Pension insurance contributions are automatically deducted from employees’ wages. When you reach retirement age, you are entitled to a pension payment, but the amount of this pension depends on your years of service and contributions paid.

Social assistance after moving to Germany

Germany has an extensive social support system. Depending on your situation, you may be entitled to various forms of assistance, such as Kindergeld (child allowance), Arbeitslosengeld (unemployment benefit) or Wohngeld (housing allowance).

Managing your finances in a foreign country can be overwhelming at first, but with good organisation and an understanding of the local financial system you can manage your funds effectively in Germany.

Moving to Germany

If you are planning a move to Germany, managing your finances is a key part of acclimatising to your new country. Here are some steps you can take to get your finances in order when you move to Germany.

Open a bank account

There are many banks in Germany that offer different types of accounts, both traditional and online. Here is some information about bank accounts in Germany:

– to open an account, you will usually need a valid proof of identity (e.g. passport), proof of your address in Germany and perhaps proof of income;

– some banks offer special accounts for foreigners or new residents;

– Popular banks in Germany include Deutsche Bank, Commerzbank, Sparkasse and DKB.

Understanding taxes

If you work or run a business in Germany, you have to pay income tax.

– Germany has a progressive tax scale, the amount of tax you pay depends on your income;

– it is worth consulting a tax adviser to find out more about your tax obligations.

Cost of living in Germany

Germany, like any other country, has different costs of living depending on the region.

– In larger cities, such as Munich or Frankfurt, the cost of living can be higher than in smaller towns or the countryside;

– The main expenses include rent, food, transport, insurance and entertainment.


Health insurance is compulsory in Germany.

– if you work as an employee, part of your health insurance is automatically deducted from your salary;

– if you are self-employed or not working, you must arrange private health insurance.

Planning for the future

Germany has a well-developed pension system.

– If you work in Germany, you are likely to contribute to the pension system through social security contributions;

– it is worth finding out more about your future pension entitlements.

Financial advice

It is worth consulting a financial advisor who can help you understand German regulations and taxes and give you tips on how to invest and save.

Understanding Germany’s financial culture

Germans are known for their attention to saving and avoiding debt. It is worth adapting to this culture to avoid financial problems.

The German financial system

Keep in mind that although the beginnings can be challenging, adapting to the German financial system can bring many benefits in the long term. Moving to Germany can be the best decision of your life if you prepare for it properly.