Tips to help when choosing the best investment for you
The best investments depending on your age and your objectives.
Your projects evolve with time, as does the way you finance them. We advise on how to build up savings and choose the best investment support at each important stage of your life.
From 20-25 years old: Save at the start of your working life
When looking for an investment with no risk, your best interest is to open a "Livret Jeune", the rate of return is 1% (gross rate applicable as of 01/10/2016), and interest earned is exonerated from income tax and social charges.
No matter how old you are, if you are working and your income tax level reference (stated on your tax return) is equal to or lower than 19255€ for the first part of family quotient (2016 terms) you have the right to hold a livret d’épargne populaire (LEP). You would be wrong to pass this by: this investment with capital guaranteed is remunerated at 1.25% (gross rate applicable at 01/08/2015).
35-50 years old: Consolidate your savings
Now you have established a financial safety net, are you looking for somewhere to put aside your new savings?
If you haven’t yet bought your main residence and you think that you could be doing this in the next 4 – 10 years, look at the PEL. As for Assurance Vie (life assurance) this remains the traditionally indispensable investment. More sophisticated than a classic deposit account, it offers a wide range of investment supports for you to choose from depending on the term that you are looking at and your attitude towards risk. On top of this, it offers inheritance and tax advantages. If you keep your savings for at least 8 years you benefit from an allowance of 4600€ (9200€ for a couple) on any gains made and you can choose how you wish to be taxed either in your own tax bracket or a flat rate tax of 7.5%.
From 50 years old: Prepare for retirement
After having invested in property are you looking to supplement your income in order to maintain your lifestyle once retired? If so the Retirement savings plans are made for you!
The PERP, is available to all future retirees or the Madelin contract, reserved for company directors and self-employed people and guarantees you a regular income until the end of your life, as long as that may be.
With the PERP (but not Madelin) you can even opt for a partial withdrawal of capital up to 20% of the value of your contract. The main advantage of these contracts is the tax advantage associated at the outset. Each year, the sums deposited on to the PERP are deductible from your taxable income within the limit of 10% of your income net of professional costs of the previous year, with a threshold of 3862€ and a limit of 30893€ for deposits made in 2017.
Source: "Dossier familial" n° 0504
Is the amount in Billions of euros invested onto life assurance in 2015, of which 1299 billion in Euro funds. The total sum held on the Livret A in 2015 is only 244.6 Billion euros.
Sources : Association française de l’assurance, Observatoire de l’épargne règlementée.
|Availability||Investment Type/Vehicle||Withdrawals||Taxation on capital withdrawals|
|PERP, Madelin||None, except in the event of early redemption||Contract in euro funds with capital guarantee or in units of account||Life annuity only (withdrawal in capital at 20% for the PERP)||PERP only: fixed rate tax of 7,5 % after an allowance of 10%|
|Perco||1 500€ from Credit Agricole dispensers||By default, guided management - retirement||Capital or annuities||Exonerated from income tax. Social charges at 15.5%|
|Assurance-vie||Withdrawals possible at all times||Contract in euro funds with capital guarantee or in units of account||Capital or annuities||After 8 years fixed rate tax of 7.5% after and allowance of 4600€ (9200€ for a couple), 15.5% social charges, but only on the units of account|
|PEA||Withdrawals possible but, before 8 years will close the investment plan||Mainly invested in shares||Capital or annuities||After 5 years exonerated from income tax. 15.5% on social charges|