Frühstart-Rente in Germany: What Expat Families Get from 2027

expats.de has explained German money decisions for international families since 2014. This guide follows the Bundestag's text: the government bill (Bundestag printed paper 21/7864) as amended by the finance committee (21/8606), plus the government's answers to two parliamentary questions. Where the law doesn't settle a question, we say so instead of guessing. For the adult product built on the same rules, read our Altersvorsorgedepot guide.

What the Frühstart-Rente is

The federal government pays €10 for every month in which your child meets the conditions. The entitlement starts with the month of the sixth birthday and ends with the month before the 18th birthday. That is 144 months, or €1,440 in total, if your child lives in Germany the whole time.

The money doesn't reach your bank account. The state pays it every quarter, in arrears, to the provider of a certified retirement contract in your child's name. That contract is a standard depot, the simplest variant of the new Altersvorsorgedepot: the provider picks two funds and shifts the money towards the safer one as retirement approaches.

You and other relatives can pay in on top, up to €6,840 per calendar year. Grandparents can contribute too. These extra payments don't earn a tax deduction for the person who pays them, and they don't trigger more state money. The state contribution stays at €10 a month however much you add.

Which birth years qualify

The Frühstart-Rente starts with children born in 2020. They receive the payments for 2026 retroactively, paid out from 2027. Children born in 2021 join in 2027, and every following year adds the new six-year-olds. A child born on 1 January 2020 gets a double payment for January 2026; the finance committee added that detail.

There is no catch-up for older children. A child born in 2019 or earlier never receives the Frühstart-Rente, even if they are only seven when the law starts. You may still open a contract for them, but the law says it runs "without state contributions". The Bundestag rejected a proposal to include all children aged 6 to 17.

For expat families this is the first check. If your children were born before 2020, the rest of this article explains a product your family can't use for them. A Junior Depot remains open to every age.

Residence, not passport: what counts for expat families

Two conditions decide whether a child qualifies. The child must be registered with a first residence in Germany, and the child needs a German tax identification number. The law doesn't mention nationality. The explanatory memorandum rejects school attendance as a criterion and says the parents' residence doesn't matter. Only the child's registration counts.

There is no link to Kindergeld either. The Federal Central Tax Office checks entitlement against the child data it stores for payroll tax. The explanatory memorandum adds that the Frühstart-Rente isn't a family benefit under EU Regulation 883/2004, the rulebook that coordinates family benefits between EU countries.

If your child was born abroad and has no German tax ID yet, the Federal Central Tax Office issues one. A tax ID assigned later counts back to the months in which your child already met the other conditions. Register the address first; our Anmeldung form tool fills the official form for five cities.

What the law means for typical expat situations:

What happens to the money after you leave

The government states that a move abroad doesn't trigger repayment by itself. The money stays in the contract. Authorities make a final assessment when the payout phase begins, under § 95 of the Income Tax Act together with §§ 93 and 94. For other subsidised retirement contracts, § 95 treats a residence outside the EU and the EEA at any point from the start of the payout phase like a harmful use, which means subsidies are reclaimed.

What that assessment means for Frühstart-Rente money is open. Neither the law nor the explanatory memorandum spells it out. If your child may live outside the EU or EEA in retirement, the state-funded part of this depot carries that uncertainty for decades. Your own extra payments are a different matter: according to the bill, the contract lets you withdraw them and their returns.

How the money reaches the depot

You don't apply for the Frühstart-Rente yourself. When you sign a certified standard depot contract for your child, the provider counts as authorised to claim the payments from the central office at the German pension insurance. You can object before signing. Only one subsidised contract per child exists.

The finance committee added cost protection. Providers may not charge acquisition or distribution costs on the state-funded part until the payout phase, and they may not charge for a transfer to another provider. Until the 18th birthday, you can only move the full balance to another standard depot. From 18, your child can move it to any certified retirement contract.

If you sign nothing, the money isn't lost. The federal government invests it collectively for every child without a contract, in a special fund that starts on 1 January 2028. The Deutsche Bundesbank manages it, and the committee limited it to broadly diversified global shares and equity funds. There is no compensation for losses. Your child can later sign their own contract and receive their share as starting capital, as long as the contract is signed before the 35th birthday. Money nobody claims goes back to the federal budget; the law requires that eligible people are informed beforehand.

Locked until retirement

The Frühstart-Rente is retirement money in the strict sense. The law only allows payment as a retirement benefit under the certification act, and the government states that payout isn't possible before age 65 as a rule. The law makes one exception: the money may go towards a home your child lives in, under the Eigenheimrente rules of § 92a of the Income Tax Act; according to the bill's explanation, for example after the balance has moved to another certified retirement contract. Nobody can pledge, sell or seize the balance. Until the 18th birthday, you can cancel only the part paid from your own contributions, or move the contract.

Taxes follow the pattern of German retirement contracts. The monthly payments aren't taxable income, and gains inside the depot stay untaxed during the savings years. Payouts are taxed later under § 22 No. 5 of the Income Tax Act. The part built on state money is taxed in full; the part from your own extra payments gets a lighter treatment. If a child dies before 18, the law doesn't reclaim the payments.

For your planning this means: count the Frühstart-Rente as part of your child's pension, not as savings for their twenties.

What the law leaves open

These questions have no answer in the law at this review. We list them so you can ask the right authority or wait for official guidance:

1. Bürgergeld, BAföG and housing benefit. The law contains no rule on whether the balance counts as an asset. The government's view is that it doesn't count for Bürgergeld while your child is a minor. That is an opinion in a parliamentary answer, not a legal rule. For BAföG and Wohngeld the government only refers to the rules of each benefit. Open.
2. Living outside the EU or EEA in retirement. The final assessment under § 95 starts with the payout phase. What it reclaims from the Frühstart-Rente is open.
3. Split households. Shared custody across two countries and double residences have no own rule. Only the registered first residence counts.
4. The Bundesrat vote. Without consent there is no law. The date is open.

Frühstart-Rente or Junior Depot: which money is for what

The two products answer different questions. A Junior Depot holds money your child controls at 18: for an apprenticeship, a driving licence, a semester abroad or a first deposit on a flat. The Frühstart-Rente holds money for your child's retirement. Your family can have both, and the state payment doesn't depend on whether a Junior Depot exists.

Three questions sort out what fits your family:

• When will your child need the money? Before 65: a Junior Depot or a savings account. At retirement: the Frühstart-Rente does the job, and extra payments add to it.
• How likely is a life outside the EU later? The open § 95 question weighs more for families who may settle in the US, Asia or the UK.
• Who should decide at 18? A Junior Depot hands control to your child. The Frühstart-Rente doesn't, until retirement.

For a children's account you can use before retirement, compare terms in our Junior Depot comparison or answer two questions in the Junior Depot finder. Our guide to investing for children covers documents, gifts and the handover at 18, and the children's tax guide covers allowances.