How to Invest in Germany: Before You Start

How to Invest in Germany: Before You Start

1. Introduction

Have you ever wanted to know how investing in Germany works? Then this is the right series of blog posts for you that will make you a true investing genius. A lot of expats we talk to have the will to start investing in Germany but don’t start because they don’t know how to do it.

This is the first post of a 6-part series on “How to Invest in Germany” that is designed to make you an investing expert. Because we believe you don‘t need to read a lot of books or google yourself through the internet to find out how this whole investing thing works. You just have to understand and follow some basic principles that will be explained in this post series in detail.

2. Overview of the Post Series “How to Invest in Germany”

  1. Before You Start: This post will lay all necessary steps before you should even begin to invest.

  2. Magic Triangle of Investing: The most fundamental tool of investing that will help you decide which investment goals are most important for you.

  3. Taxes on Investments (ETFs, Real Estate, Pensions): This post extends the Magic Triangle of Investing to the Magic Fiveangle of Investing.

  4. 7 Investing Tips: Learn from other peoples money mistakes and follow these 7 tips for true financial success.

  5. 8 Investing Fails: This post will help you to prevent the most common (beginner) mistakes that will end your investing career before it starts.

  6. Psychology of Investing: Emotional investment decisions will lead to failure. Learn in this post how to control your emotions.

3. Who Is Writing the "How to Invest in Germany" Series?

Axel, our founder, will teach you in 6 parts what took him 10 years to learn all by myself. He started small with 300€ and learned over time what it felt like to have small gains and small losses – as well as big gains and big losses.

From speaking with many expats over the years, we know that the hardest part of investing in Germany is taking the first step. Especially with the language barrier, the details can be overwhelming and cloud the bigger picture.

That’s why Axel has help from 2 expats. Together they will prove to you that investing in Germany is easy to do and nothing to be afraid about.

Amanda, 27 is our smart investor

- Just graduated from university and starts working now
- Wants to start investing right away with her first salary
- Has a smart approach to investing and wants to learn
- Asks the right questions to find her investing strategy

Steve, 37 is our stupid investor

- Never really cared about money until now
- Mistakens investing with speculating/gambling
- Thinks more about products instead of his strategy
- Listens to his friends who know nothing about investing

The two have very different approaches to investing and in every post of this “Hot to Invest in Germany” series you will see how things play out for them. The important point is that both are exactly where you are at right now. Determined to take charge of their financial future by investing in Germany – but not sure how to start and where to begin.

In the beginning it is important to focus on what you can control – that’s what a smart investor does. So don’t worry that you should have started to invest earlier, start now. Don’t worry that you should invest more money, save whatever is in your budget.

If Amanda & Steve can master investing, you can do it too. One small step at a time.

Just follow the tips we give you in this series and don’t follow advice from your friends colleagues, neighbors, or your aunt. Most of the time they are not the greatest financial advisors. They just tell you to buy investment product A or investment product B and you will be rich tomorrow.

And when you do your research on the internet, interestingly you will find a lot of information that back up the opinion of your friends. The psychologists call this trap Confirmation Bias: the tendency to interpret information in a way that supports your existing belief.

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4. What the “How to Invest in Germany” Series Will Do for You

A lot of people think like Steve that investing works by picking individual investments. While you can do with your own money whatever you want, this series is all about the strategically clever way of investing. By approaching investing like this, all you expats have the highest chance of succeeding in the investing game.

It might sound boring that we do not pitch the next hot stock or cryptocurrency to you, but it will deliver consistent long-term growth of your investments. And that’s what you want, right? Because we are not in the speculation business and neither should you.

“Nobody knows the future.

Nobody can predict the value of an individual investment product tomorrow, next week, or next year. What we know is that your chance of losing is much higher than your chance of winning when you try to Speculate or gamble with your money. You might know this from casinos: The house always wins. And same is true for investing in Germany.

Do you invest in Germany already? If not, what is holding you back?

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