100 euros for retirement: salary conversion or Altersvorsorgedepot?

Ruven Simon

Published on 10 September 2026 · Head of Occupational Pension Sales (bAV) and authorised signatory (Prokurist), WWK Lebensversicherung a. G.

This article was written by an author with the support of AI.

With 100 euros, what matters is which income the money comes from. We compare salary conversion through an occupational pension with the Altersvorsorgedepot planned for 2027 and show which factors influence the decision.

100 euros for retirement: a direct comparison

For the same nominal contribution, salary conversion initially has a smaller impact on disposable net income during the saving phase: 100 euros are converted from gross pay, so the actual reduction in net income is generally less than that. With the Altersvorsorgedepot, 100 euros are paid in from income that has already been taxed. In return, from 2027 the Altersvorsorgedepot (AVD) offers direct support through state allowances: the basic allowance rises to up to 540 euros per year and is reached when 1,800 euros in eligible personal contributions are paid in annually^[1]. A fair comparison must therefore start with the individual's own cost and also take into account employer contributions, allowances, fees, and subsequent taxation and social insurance contributions.

Note on model calculations: The figures shown illustrate how each system works and do not constitute investment advice within the meaning of § 1(1a) no. 1a KWG. The actual net cost varies according to tax class, federal state and the additional health insurance contribution.

Why salary conversion immediately saves net income

The financial advantage of salary conversion lies in the principle of saving from gross pay: under § 1a(1) BetrAVG, employees can request that future salary entitlements of up to 4 percent of the general statutory pension insurance contribution assessment ceiling be used for an occupational pension ^[2]. If, for example, a contribution of 100 euros per month is converted into direct insurance, a Pensionskasse or a pension fund, the income subject to tax and social security contributions generally falls by that amount. The payslip therefore shows a net deduction that is usually lower than the gross amount converted. The actual relief depends on individual salary and insurance details.

The tax and social security rules set upper limits linked to the contribution assessment ceiling (BBG) for general statutory pension insurance. For 2026, these produce the following figures:

• Exemption from social security contributions up to 4 percent of the BBG ^[6]: the general statutory pension insurance contribution assessment ceiling is 101,400 euros per year or 8,450 euros per month in 2026 ^[3]. Up to 4 percent of this amount is generally exempt from social security contributions through the arrangements mentioned. This corresponds to 4,056 euros per year or 338 euros per month.
• Tax exemption up to 8 percent of the BBG: under § 3 no. 63 EStG, contributions to a pension fund, Pensionskasse or direct insurance can remain tax-free up to 8 percent of the general statutory pension insurance contribution assessment ceiling ^[4]. In 2026, this corresponds to 8,112 euros per year or 676 euros per month. The additional portion above 4 percent of the BBG is generally not exempt from social security contributions. ^[6]
• Statutory employer contribution of 15 percent: under § 1a(1a) BetrAVG, the employer must generally pass on an additional 15 percent of the converted salary, to the extent that salary conversion saves the employer social security contributions ^[2]. If the employer voluntarily provides a higher contribution or fully funds the occupational pension, this shifts the comparison in favour of the occupational pension.

It is important to bear in mind that lower gross pay subject to social security contributions can result in lower contributions to statutory pension insurance in the year concerned. This can slightly reduce the future statutory pension entitlement. This effect should be considered in an overall calculation alongside employer contributions, occupational pension benefits, fees and subsequent deductions. ^[7]

What the Altersvorsorgedepot provides for from 2027

The Altersvorsorgedepot planned for 2027 follows a different approach: personal contributions are paid from net income that has already been taxed. A state allowance may then be added, based on the contribution actually paid, and credited to the contract. The precise arrangements depend on the statutory requirements and the terms of the particular product ^[1].

According to the information provided, basic support from 2027 is intended to work as follows ^[1]:

• 50 cents in state allowance for each euro personally saved, up to a contribution of 360 euros per year ^[1].
• 25 cents for each additional euro saved above 360 euros, with eligible contributions up to 1,800 euros per year ^[1].
• This results in a maximum basic allowance of 540 euros per year. Personal contributions eligible for the basic allowance extend to 1,800 euros annually. Higher payments up to the statutory contribution limit may be possible, but they do not increase the basic allowance ^[1].
• A child allowance of up to 300 euros per child per year. It depends on the personal contributions paid and the other statutory requirements; the maximum amount can be reached with personal contributions of 300 euros per year^[1].
• A one-off career-starter bonus of 200 euros for savers who take out a retirement savings contract before their 25th birthday^[1].

As a private contract, the Altersvorsorgedepot is not tied to a particular employer. It can be continued when changing employers; transfers and changes of contract are subject to the applicable statutory and contractual terms. Since no gross salary is converted, this savings contribution does not reduce statutory pension points. A minimum personal contribution of 120 euros per year is envisaged for the basic support.^{[1] [5] [7]}

Three factors that can change the calculation

There is no universal answer to whether 100 euros in an occupational pension or an Altersvorsorgedepot will ultimately produce higher net assets in retirement. Three key factors determine the outcome:

1. Employer contributions above 15 percent: in many cases, the statutory minimum contribution of 15 percent merely offsets the reduction in the statutory pension and the costs of conventional insurance wrappers. A higher voluntary contribution or full employer funding can make the occupational pension particularly attractive in the comparison. ^{[2] [7]}
2. Tax and allowance effects: with an occupational pension, relief arises during the saving phase through tax savings and, where applicable, social security savings. With the Altersvorsorgedepot, the focus is on state allowances. The child allowance can be an important factor for households with children. In each case, what matters is the individual's support relative to their own cost.
3. Payout phase: occupational pension benefits are taxed on payout. Health and long-term care insurance contributions may also apply; the statutory health insurance allowance for occupational pensions must be taken into account. Benefits from the Altersvorsorgedepot are also generally taxed on payout. The social insurance treatment depends on the individual's insurance situation and should not be assessed in blanket terms.^{[8][9][10][13][15]}

Outlook: reforms to occupational pensions and the Altersvorsorgedepot

Both retirement savings options are changing. The legal foundations for the Altersvorsorgedepot were established in the Retirement Savings Reform Act, published in the Federal Law Gazette on 29 May 2026 (BGBl. 2026 I no. 156)^[5]; the market launch of the new products is scheduled for 1 January 2027^[1]. Providers' specific product terms, portfolio structures and fee models will take shape over the coming months.

At the same time, occupational pensions have also been developed further. The Second Occupational Pensions Strengthening Act (2. BRSG), passed by the Bundestag on 5 December 2025 and taking effect in stages since January 2026, is intended to make occupational pensions more attractive, including by opening the social partner model to companies not bound by collective agreements and expanding support for low earners. The choice between salary conversion and the Altersvorsorgedepot should therefore be based on the calculation parameters valid today, while remaining flexible in view of future product offerings. ^[11][12]

The path to an individual decision

The comparison of the two models shows that there is no standard recommendation. A useful assessment of an occupational pension starts with the specific employer contribution, the pension arrangement and the actual net cost. The Altersvorsorgedepot allowances, family circumstances, investment and payout options, and subsequent deductions should then be included. Only a comparison based on the same personal cost allows a reliable assessment.

An individual comparison should take into account at least gross income, tax class, health insurance, marital status, employer contributions, the desired retirement date and the planned forms of payout. A decision should only be made on the basis of the specific product and employer documents.

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