Better to prevent… Extension of the contribution period, postponement of the legal age of departure, with the pension reform desired by the government, the French born following 1961 fear never to be able to benefit from a decent pension. If they remain very attached to the pay-as-you-go pension system, many of the youngest people put money aside every month in anticipation of an uncertain future. According to a study carried out by the Cercle de l’épargne in March 2022, 73% of 18-24 year olds put money aside, compared to “only” 65% of 50-64 year olds.
Is this your case? Do you want to prepare a supplement for your future retirement but don’t know how? No worries, 20 Minutes discusses the best ways to achieve this.
Retirement savings plans (PER)
Some savings solutions are directly dedicated to creating additional income for retirement. In 2019, they were grouped under the name PER. There are three, one individual and two corporate.
Individual PER
The individual PER is a savings product on which it is possible to deposit money at your convenience. The sums paid may be deducted from his taxable income, within the limit of 10% of earned income and a maximum of 32,419 euros per year. These sums are multiplied according to the formula chosen, from the safest to the most risky.
Once it’s time to retire, there are two ways to liquidate your PER. Either by releasing it in the form of an annuity, a sum paid monthly by the insurer according to an estimate of the time remaining to be lived. Either by a capital, whole or fractional of the sum.
It is even possible to create a PER for minors; it is then the parents who benefit from the tax deduction, within a certain limit.
Valérie Batigne, director of Sapiendo Retraite, warns however: “These sums, and their capital gains, can only be released on retirement, with some exceptions. These exceptions are: an accident of life (death, disability, over-indebtedness, end of unemployment rights, etc.) or the purchase of a principal residence. Also, this solution is not suitable for all profiles of savers: “It is conducive to those who have an established rhythm of life, with an established family, a secure job. Not to those who want to keep a possibility of withdrawing their money or who do not pay taxes. »
Company PERs
There remains the mandatory PER, a savings plan subscribed by a company for its employees. As its name suggests, it is imposed by the employer who can pay profit-sharing and participation bonuses, or even a percentage of salary. If this plan is more interesting than his individual PER, the employee can even transfer these funds to it.
Conversely, in the event of departure, the employee can pay the funds into the collective savings plan of his new company (if it has one) or into an individual PER. The advantage is that the management costs of this collective PER are borne by the company.
The liquidation conditions for this plan are the same as for the individual PER.
There remains the mandatory PER, a savings plan subscribed by a company for its employees. As its name suggests, it is imposed by the employer who can pay profit-sharing and participation bonuses or even a percentage of salary. For company PERs, the amount paid is deductible from taxable remuneration within the limit of 8% of the gross annual remuneration of the employee, capped at 8 times the Annual Social Security Ceiling (PASS), i.e. 329,088 euros for 2022 .
life insurance
If it oscillates between 1.6% and 2% return in 2022, this investment remains the favorite of the French. “It’s the Swiss army knife of savings, explains Isabelle Gauthier, wealth management advisor, because you can withdraw money without breaking the product. According to this expert, life insurance has the advantage of being attractive from the start. A “fabulous tool” that allows you to enhance your capital by paying money every month and choosing from a wide variety of investments, more or less risky.
In addition to the possibility of withdrawing money unconditionally, life insurance has the advantage of tax-exempt transmission before the holder turns 70, who can reward anyone (no obligation of family ties) to amount of 152,500 euros. It can also be released in the form of an annuity on retirement. Last advantage, not insignificant, life insurance does not have a payment ceiling.
Classic savings
Booklet A
He too is one of the darlings of savers. If these 3% current interest rates are not enough to offset inflation, the Livret A account has the advantage of being more profitable than a current account and most other savings accounts. In addition, it makes the money placed in a secure way grow and its fruits are exempt from taxes. A safe haven which is however limited to “only” 22,950 euros via its ceiling.
The People’s Savings Book (LEP)
The only savings account to hold the dragee high in the Livret A, the LEP breaks the house with an annual rate of 6.1%. Only the most modest incomes can join (21,393 euros of reference tax income for a single person). But it shares with its cousin, the Livret A, to be exempt from taxes on the interests and to leave the possibility of withdrawing its money freely. It is capped at 7,700 euros.
The company savings plan (PEE)
Very close in its conception to the collective business PER, it is untouchable for the five years following its opening (except life accidents, marriage or investment in a main residence). The company can pay a matching contribution up to three times the amount.
real estate
Real estate purchase
Investing in stone remains a safe bet. And buying your main residence (for those who can) is a basic precaution in order to prepare for retirement. “Simply because it’s less rent to pay”, justifies Valérie Batigne. A way to relieve pensions that might be too fair.
Moreover, with the uninterrupted increase in the price of housing, the purchaser might make a nice capital gain in the event of sale at the time of retirement, to buy smaller (if the brats are gone) or quite simply cheaper.
Rental real estate
Buying to rent can also be an important source of income over time. But for those who can afford it, you still have to weigh the rental risks and set up a business plan with a broker, for example. “You have to strike a balance between the return and the costs that this implies, such as property taxes which increase with the abolition of the housing tax”, warns Isabelle Gauthier.
“Paper” real estate
More generally called “Stone-Paper” (nothing to do with Shifumi), this solution consists of investing in rental real estate… but indirectly, since it involves buying a share of a building, via a real estate investment company (SCPI), which then takes care of the management and costs of this rental. “It’s a solution for people with small means, who cannot buy directly. They can then receive an income immediately and continue to invest little by little, to build up a heritage. Yields are around 5%. »
Whatever way you want to invest, the best solution is to call on a specialist (banker, broker, insurer, wealth manager) to determine your profile, possibilities and risks.
