How to start investing in Germany?

[roybaer]

Hello friendly mustachians,

this is my first post here (yay!) and it is actually aimed at the people in germany. But just so you can read it for yourself and do not feel alienated, i will write in english anyway.

I really like you guys for all your helping other mustachians, so I hope you like me back in advance when I state following question:
How the fuck do I start investing small sums in when living in germany? I tried googling it and in almost all results it looked like they wanted to scam the shit out of me.

I never knew anybody who has an understanding of stocks, so you would help me with even the most basic instructions to get started. For example, just where to go on the Internet to buy a single fucking stock.

If you have more time and have nothing to do since you are already retired and writing full time on the MMM forum, you could make me happy by telling me if there is a protocol for investing small sums each month.
You know, like in all that postings where MMM thinks of a monthly payment, invests it instead and somehow becomes a millionaire from simply not drinking starbucks every day.

I heard of DRIPS and Direct Stock Purchase Plans, are these an option in germany? Or does it even matter where I live?


Its a big question, but even the smallest answer will bring an equally big smile upon this mustachians face, so, if you have knowledge, please answer and help!

[WerKater]

Hello friendly mustachians,

Not sure that friendly is the right word. It's very easy to get facepunched here ;)
We do try to be helpful, however.
So now that all the smalltalk is out of the way, let's get to the point:

I really like you guys for all your helping other mustachians, so I hope you like me back in advance when I state following question:
How the fuck do I start investing small sums in when living in germany? I tried googling it and in almost all results it looked like they wanted to scam the shit out of me.

I never knew anybody who has an understanding of stocks, so you would help me with even the most basic instructions to get started. For example, just where to go on the Internet to buy a single fucking stock.

Are you a German citizen? For the moment I will assume that. If no, some things may depend on your nationality and your exact legal status. How small are the "small" sums you have in mind?

Get an account with a reasonable online bank (Comdirect, ING-DiBa and Consorsbank come to mind. I am sure there are others. I am naming these three because I know them to be respectable, have or had accounts with all of them and none of them tried to scam me). All of them offer free "Depots" (weird that I don't know how to translate that into English -- a Depot is the account that stocks and funds reside in).
You will have to pay fees to buy stocks and funds (for example with Comdirect it currently seems to be 5€+0.25% of the purchase price). That's normal.
These banks probably also all offer "Fondssparpläne" which might be what you are looking for. Basically, you can direct them to invest a sum of X each month into a given fund. That typically starts at 25€/month or so. Fees for those plans are usually different from the standard fees, so check that first.

If you want, you can probably sign up with one of these banks and start investing in a matter of days. You will be able to buy all kinds of shit.
However, before you do that, I would encourage you to first look very closely at what you actually want to invest in. My standard advice is a portfolio of index funds that cover the whole world. If you want, we will be able to direct you to places where you can learn about that.

[Heckler]

It appears the favourite Vanguard will be available to you..

https://global.vanguard.com/portal/site/kiids/de/de/documents

[Heckler]

As is a S&P500 index fund with 0.07 annual fee..

  https://global.vanguard.com/portal/site/loadPDF?country=de&docId=1132

Or an All World for 0.25

  https://global.vanguard.com/portal/site/loadPDF?country=de&docId=1215

Your bonds options appear limited to the UK, probably because Vanguard does want to pay you negative interest rates.

[Heckler]

Check this out for some simple info on index investing.

http://canadiancouchpotato.com/couch-potato-faq/

[Heckler]

And you'll likely find more...


http://forum.mrmoneymustache.com/mustachianism-around-the-web/mustachianism-applied-to-german-way-of-life-deutsche-mmm-ratschlage/

[schoenbauer]

Dear roybear,

welcome on board. Vanguard ETF are undoubtedly great tools. However, there might be some nasty tax implications. The German FAZ recently wrote a short article about it:

http://www.faz.net/aktuell/finanzen/fonds-mehr/vanguard-total-bond-market-ist-groesster-rentenfonds-der-welt-13584155.html

I have my ETF with iShares, but I would like to switch to something cheaper eventually.

[roybaer]

Man, thank you guys a lot, this is really the best forum experience I had so far.
 
I had written off Vanguard before even looking further into it, all of you really provided great answers.
Also thank you very much WerKater for the thorough answer.

I think i got the information I need to get my own research started; if I stumble upon something I will write another question.
But it seems I will be sticking around in this forum anyway, if all the threads here are so helpful, then I might find good answers to questions I would have never asked.

[Kalergie]

You may also be interested in reading through this:

https://www.bogleheads.org/forum/viewtopic.php?f=10&t=162636

Basically, if you want to invest in US funds as a non US resident, certain tax implications have to be taken into account. As well as estate treaties between Germany and the US. Some really smart guys made wiki pages outlining the need-to-knows about this which you can find behind the link. Viel Spass! :)