Moving to Germany: Money Saving Advice Needed!!

tonybru

Hi everyone,

I've been living in London and commuting to work in Germany for over a year now, and the time has come to take the plunge and move there permanently.

I've been flat hunting which has been a bit of a nightmare, but that's a matter for another website i suppose! Finding out that I would lose my right to have an ISA if i moved to Germany was a shock and it made me start to think about all the other possible curve balls that might come my way.

Is there a German equivalent to the ISA? How do i find out interest rates/ inflation estimates in Germany?

Do i want to get paid in Euros? The strength against the pound now is good but what are the medium to long term prospects?

What does everyone know about the German tax system? I am 23, single, male, no kids, earning 20-25k.

How would moving affect my student loan? (10-15k)

What about the property market over there? What are the house price trends, what is the mortgage system like over there?

Anything i may have missed?

Is there a German Martin Lewis!?!?!?!

Any help would be greatly appreciated.

Best Regards, Tonybru.

richardw

Travel wise, there is Air Berlin, Germanwings, easyJet, Ryanair and Lufthansa and https://www.bahn.de so plenty of differing ways to travel and possibilities.

simpywimpy

Germans love to rent rather than buy I believe but everything price wise depends on what part of Germany you are going to.

I also am led to believe that the taxation rates are higher than the UK though I don't know the rates.

briona

Hi Tony

I was looking at relocating to Germany last year, although in the event, it never actually happened! I did however research a number of sites, and buy some books (links to which are below).

The website below says that last year (07/08) taxes for a single person earning between EURO 7,664 (TFA) and EURO 52,152 ranged from between 15% and 42%, with incomes over EURO 52,152 being taxed at 45%. I believe that there may be some other taxes as well – you would need to check that out!

http://www.howtogermany.com/

http://www.amazon.co.uk/Live-Work-Germany/dp/1854582887/ref=sr_1_2?ie=UTF8&s=books&qid=1226755111&sr=8-2 (published in 2002 – so not very up to date!)
http://www.amazon.co.uk/Know-Germany-Indispensable-Working-Language/dp/1400020468/ref=pd_sim_b_4 (published 2003 – there may be a more recent edition of this though).

As someone has already said, most Germans rent rather than buy but should you like to buy there is info on the website I quoted about mortgages etc. I found that house prices vary massively, with some properties being extremely cheap (approx 40K sterling) to others that are very much in line with London prices. Personally, as Germany's economy has been hit pretty hard by the global recession, I would be inclined to rent for a bit! The website below (given to me by a German!) is Germany's national property hunting site – both rental and buying. It's all in German, but having worked there, I assume you ahve enough to figure at least the basics out!

http://www.lbs.de/

Depending on where you are moving to, not everywhere accepts cards – I go to the South of Germany a few times a year and acceptance of cards is pretty low! Some things in Germany like ADAC (the equivalent of the AA) can ONLY be paid for using a German bank account, so you may want to open one for things like that!

I don't know about your ISA over here and how it would be affected by you living in Germany. Perhaps you should check with the bank its held with? As for the student loan, as long as you are continuing to make the payments, I can't see that it matters where you live!

Hope some of that helps!

Briona

tonybru

As a follow up, I am on the German Dutch border, near the border between Niedersachsen and Nord-Rhein Westphalia.

My German is pretty good after a year.

Thanks for that advice Briona i am on howtogermany.com now!

Any more advice from anyone would be brill, thanks!

Tonybru.

jyonda

The best resource for answering any and all queries on life in Germany is:

https://www.toytowngermany.com

As a single with no kids you can expect to get the worst tax class (Lohnsteuer) running to about 40%. If you are freelance/ self employed it can be better but seek out a good Enlglish speaking tax specialist on TTG.


Generally speaking if your living expenses are in Euros then it's best to be paid in Euros. If I were you I'd keep a UK bank account open at a parents address just to hold on to your financial identity in the UK and not bother getting rid of the ISA's. OK it's not allowed but you may move back to the UK within a year or two and you've lost all your allowances. I don't know what the penalty is exactly but it can't be that bad....

Re property: Location, location, location. There's a recession on and it's official so you may be able to snap up a reposessed bargain at auction. The German system of auctioning off property (zwangsversteigerung) is far more secure than here in the UK as the local authority actual handles the sale and prepares a full independant report and valuation which makes it very easy to get finance on such properties. Of course you need to stump up 10% and about 4% taxes straight away but considering purchases via Estate Agents (Makler) carry a 6/7% fee FOR THE BUYER, it's hands down a better way to buy if you can find what you're after. Quite a lot of the single properties you will find already have a tenant and being a Landlord in Germany is much different from here so wannabe amateur BTL landlords need to take great care before piling in. My advice is if you can, buy a townhouse (mehrfamiliehaus) in need of some TLC and convert it into flats then live rent free in one of them whilst collecting from your tenants. If you have a void or a non paying tenant then you will still have income from the others. The German economy and house prices have stagnated for years and they are by no means immune from the global financial turmoil but if you're in it for the long haul you should have a nice little earner for your retirment. Strictly my opinion only and I'm mostly always wrong so don't listen to me.

https://www.immobilienscout24.de