The introduction of an ‘early-start pension’ is intended to ensure that retirement provision begins as early as childhood, with state contributions to a funded pension scheme. On 22 July 2026, the Federal Ministry of Finance presented a draft bill. A list of frequently asked questions has also already been published.
Through the early-start pension, the Federal Government aims to support the early establishment of private pension provision. To set up an early-start pension, parents of children who have reached the age of 6 can open an individual, funded and privately managed pension savings account with a provider of their choice that meets the requirements of a standard savings account.
The federal government pays EUR 10 per month into the account for these children until they reach the age of majority. Parents may make additional personal contributions of up to EUR 6,840 per year. If the parents do not open a pension savings account, the unclaimed funds are invested collectively according to the children’s year of birth. If an account is opened at a later date (by the parents or the beneficiaries, who have since reached the age of majority), the funds accumulated in the collective investment can be transferred to the personal pension savings contract. From the age of 18, the pension savings account can be topped up with personal contributions until retirement. Alternatively, it is possible to switch to another certified pension scheme.
PLEASE NOTE—Income from the ‘Early Start Pension’ remains tax-free until the start of the payout phase, i.e. until retirement.
All children born in 2020 or later, aged between 6 and 18, who have their primary residence in Germany, are eligible. The legislative process is due to be completed in 2026. It is planned that payments will be made retrospectively from 1 January 2026 – initially for children born in 2020, i.e. those who will be six years old when the scheme starts. In subsequent years, children who turn six in the respective year will then also become eligible.