The brokerage account is opened in ten minutes, the first savings plan in two. What beginners should know first: choosing a broker, order types, costs, tax and the question of individual shares or ETFs.
In short
- First the emergency fund, then debt gone, then the portfolio. Invest only money that can sit for ten years.
- Account at a neobroker or direct bank, free, savings plans from one euro.
- Start with a world ETF via savings plan; individual shares only once the core stands.
- Limit order instead of market order, trading hours 9 to 17:30, set up the exemption order.
Step one: the order
Before the first euro goes into stocks, the emergency fund stands and loans above five percent are repaid. Stocks fluctuate, and whoever has to sell in a crash because the car broke down loses. Only invest money you will not need for ten years. Whoever meets that has the hardest part behind them.
Step two: the broker
Neobrokers offer savings plans from one euro, orders for one euro or free and an app that feels like a game. That is an advantage and a danger. Direct banks charge five to ten euros an order but offer full service, all trading venues and less temptation to trade. Both are safe: securities are segregated assets and belong to you even if the broker fails. Look for free account keeping, ETF savings plans without fees and German withholding tax handling so you do not have to deal with capital gains tax yourself.
Step three: the first purchase
A world ETF, accumulating, physically replicating, fund size above a billion euros, running costs under 0.2 percent. Via savings plan, monthly, the day after payday. The plan buys automatically, even in a crash, and that is exactly the trick: nobody hits the right moment, the plan hits the average. For a lump sum above €20,000 you spread over three to six months, more for the nerves than for returns.
Step four: order types and hours
A market order buys immediately at the next price, a limit order only up to your price. Use limits, especially for small stocks and outside Xetra hours from 9 to 17:30, when the spread between bid and ask is wider. Do not trade at the open and not after 8 pm. For savings plans none of that matters; they run at fixed times.
Step five: tax and admin
Set up an exemption order of €1,000 with the broker. The broker pays the withholding tax; you declare nothing in the tax return. For accumulating ETFs the broker debits the small advance lump sum from the settlement account in January; a few euros should sit there. Otherwise: delete the app or switch off notifications, look once a quarter.
Individual shares
Whoever fancies companies after a year of ETFs buys individual shares with at most ten percent of the portfolio, at least ten different ones, from various sectors and countries. Not the company whose product you love but the one whose annual report you read. Returns arise here too over years, not weeks.
Frequently asked questions
How much money do I need to start?
One euro. Savings plans from €25 a month make sense, from €100 they are noticeable, from €300 they build six-figure sums in 20 years.
What happens in a crash?
The portfolio sits 30 to 50 percent lower, the savings plan buys cheaper, after three to five years the level is usually reached again. Whoever does not sell has lost nothing.
ETF or bank fund?
ETF. Active funds cost ten times as much and beat their index over ten years in fewer than 20 percent of cases.
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