Financial investments: savings account, call money and time deposit account

In addition to traditional savings accounts, you can also opt for securities as an investment. The interest rates are higher. The disadvantage, however, is that you cannot count on the money so well. You do not know in advance how the interest rates will develop, because they depend on the prices on the capital markets. In contrast, the classic investment of money in the form of a savings account, a call money or a fixed-term deposit account can be calculated exactly in advance. However, the interest rate can be significantly lower than if you invest in shares or securities.

Pay attention to the availability of the investment

If you have saved reserves for the purpose of construction financing, it is advisable to coordinate the investment of funds with your planning. This applies in particular to investments in securities and fixed-term deposits. The capital will not benefit you if it is not available on the due date. If you liquidate cash investments prematurely, you will often lose some of the interest or be charged fees.

Investing money from the sale of real estate in a financial investment

Similarly, you can transfer money you receive from a property sale into an investment. This is possible in the short or long term. Since most banks no longer pay interest on funds held in a current account, it is advisable to transfer funds that are not needed immediately from the current account to an investment. With the large amounts you get for selling a property, even low interest rates have a positive effect and you can make a positive profit. If you would like individual advice on financial investments to be used in connection with the sale or purchase of a property, we would be pleased to offer you our services.

Investment in shares and securities

Shares and securities are considered a flexible and very profitable investment. You can buy individual shares, or you can decide to invest in a fund. In this case, different shares are grouped together. The fund is managed by experts. In principle, you can buy or sell shares at any time at the current daily price. However, always keep an eye on the development of the increase in value. Also take into account that the securities account is subject to charges at many credit institutions. Furthermore, the purchase price of a share is higher than the issue price.

Value development: consider risk in calculation

In contrast to a classic savings investment, the performance can go down as well as up. You should also take this into account in your calculation. Compared with other financial investments, you can achieve the highest returns by investing in shares and securities. However, this may take some time. Knowledge of the market is an advantage. If you want to save money for a construction loan, stocks and securities are only a good choice if you plan for the long term. Short-term gains are theoretically possible. However, unlike the classic fixed investment, they cannot be planned.

Fixed investments with classic interest rates

A fixed-term deposit has a specific term. The interest rate is also fixed, so you know in advance how much money you will have available at the end. This is an advantage for construction financing. The disadvantage is that interest rates are at a consistently low level. This is especially true for cash investments with a short term. Also take into account that you usually do not have access to the money during the fixed period. You can terminate a fixed-term deposit in the normal way. However, you must observe notice periods of up to a quarter of a year and you will lose part of your interest.

Per diem account: Advantages, disadvantages, interest

You should only deposit money in a call account if you need it at short notice or do not know exactly when the withdrawal is necessary. Overnight deposit accounts are often linked to the current account. Transferring the money and returning it to the checking account usually takes one banking day. The advantage is the immediate availability of the money. The disadvantage is the low interest rate.

Real Estate Loan

A construction loan differs from the classic consumer loan by the more favourable interest rates and the longer term. The property serves as collateral for the financing. The debt is entered in the land register. If the instalments cannot be serviced on time, the bank has the right to terminate the property loan and pursue foreclosure. In this case, it gets back its money or a large part of it. Thanks to this deposited collateral, the bank has the possibility to grant more favourable conditions for real estate financing than for a consumer loan granted without the deposit of collateral.

Budget calculator: Overview of income and expenditure

Real estate buyers and builders are usually dependent on a real estate loan. The sum can only be paid in cash in very rare cases. Before you can calculate the budget for your real estate financing, it is important that you get an overview of all income and expenses with the budget calculator. You will continue to carry most items despite taking out the property loan. If you have been living for rent up to now, this will fall away when you move into your own home. However, it is a fallacy if you assume that you can simply convert the rent into a monthly installment. The monthly instalment that you pay for the mortgage is more or less the same as the basic rent.

In addition, there are the ancillary costs that you have to pay as the owner of a house. These include the costs for electricity, water and heating. Furthermore, waste charges, property tax and fees for the work of the chimney sweep are due. As a homeowner, you are also responsible for the costs of all repairs. For this reason, it is important that you build up a monthly reserve. All in all, an average-sized family home will add up to several hundred euros a month. You need to include this in your budget if you want to put the financing of your new property on a firm footing.

Use budget calculator effectively

A budget calculator will help you list all the costs that are incurred in the process of household management. In principle, of course, you can do these calculations on paper. In practice, however, it has been found that often items are forgotten or calculated too tightly. In the budget calculator, all possible costs that may arise in connection with household management are clearly listed.

Functions of the calculator

You determine which costs you incur and enter the corresponding amount. Leave the fields that are not relevant for you blank. Make sure that you enter all costs realistically, otherwise the budget calculator will not be of any effective use to you. After all, you want to give an honest forecast and not falsify it with embellished information. Effective use requires a realistic indication of the actual costs incurred. If this is difficult for you because you have not thought about it at all so far, it is advisable to keep a budget book for a month. In this way, you can see what you are really spending. You can then transfer the values to the budget calculator.

Budget item

The individual items that are incurred for the management of a household, differ very individually. They depend on the household income, but also on personal interests. However, basic items can be defined in general terms, as they are incurred in almost every household. The costs in detail:

• Food
• Rent/loan instalments for own property
• Energy costs (gas/heating oil/pellets, water, electricity)
• Service charges (rent or individual payment according to invoice)
• Telephone and Internet
• Insurances
• Clothes
• Cosmetics and drugstore articles
• Books and magazines
• Fuel/public transport
• Medication/doctor’s fees
• Radio and television

Other costs and fees can be very individual. In many households, the following items are added:

• Daycare and school
• Sports Club
• Culture (cinema, theatre, lectures)
• Further education
• Travel
• Vehicle purchase
• Hobby
• Savings rates
• Credit rates

The advantage of a budget book is that you can also include small amounts in your calculation. This gives you a very good overview and you only need to transfer the results into the budget calculator.

Get an overview of income and expenditure

Once you have listed all the costs, compare them with your income in the household calculator. At the end you will get an evaluation. You will find out whether you have an amount left over in the month or whether your budget is negative. You can react to this accordingly.

Budget calculator and construction financing

In the context of construction financing, the budget calculator plays a very important role. It is used in the planning phase to determine what savings opportunities there are in the budget. This becomes necessary when money is to be freed up from the household income to pay loan installments. A budget calculator is very effective if you use it correctly.

Calculator at a glance

Calculator – Exact planning of the construction financing

Calculators are necessary in relation to construction financing in order to accurately determine the cost of purchasing or renovating a property. A calculator is also used to determine the cost of the loan. The credit costs are composed of the interest and the repayment portion for the current loan amount. The interest plays an important role. Since the term of a real estate loan is usually ten years, the interest payment is spread over a long period. If an offer from a bank is only half a percentage point cheaper in their interest, you can already save several hundred euros a year. This is also due to the high loan amounts, which for most construction financing a six-digit amount. Before taking out a loan, an individual consultation is important. Often the construction financing consists of several pillars and not just a single loan. A building savings contract, equity capital and development loans come before taking out the classic bank loan. The reason for this is that these financings are significantly cheaper than the bank loan in terms of their costs. The calculator helps you to divide the financing into different elements and thus determine the costs with certainty.

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Interest calculator – Construction financing

The interest rates are a very large item in a construction financing. It is recommended that you compare the various offers and conditions well in advance. In this way, you will find out which construction financing is particularly favorable. Since the interest is a very large part of the monthly loan payment, especially in the first years of real estate financing, it is important that you try to save costs.

• Learn more about the interest calculator.

Budget Calculator – Equity & Income

Before the purchase of a house, a comprehensive renovation or a new building can be planned, it is very important to determine the available budget. Construction financing is planned over a period of many years. Financing between ten and 25 years is possible. It is important that the financing is planned from the beginning on a secure foundation. The basis for the budget that is available to you for the conclusion of a construction financing is your income.

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Offer comparison calculator – advice & options

The offer comparison calculator is an important tool when it comes to choosing a partner for taking out construction financing. Many builders are dependent on taking out a classic loan at a bank or savings bank, because the funds from the equity, a building savings contract and a subsidized loan are not enough. Although the comparison possibilities of the indication by the Internet are very simple and transparent, many owners trust only in the offer of their house bank.

• Learn more about the quote comparison calculator.