The Brokerage Account – Take Control of Your Wealth in Germany
By: Simon Heinrich – Last updated: 09/2026
Before reading on: this page assumes your emergency fund is already sitting in an instant-access savings account. Investing only makes sense with money you won’t need in the coming years — everything else belongs on instant-access savings.
If you want to build lasting wealth or save for retirement, investing in the stock market is hard to avoid. The good news: you don’t need to be a finance expert. Historical data over the past decades shows that broadly diversified investments in the global economy, via indices like the MSCI World or FTSE All-World, have delivered average annual returns of roughly 6 to 8 percent, depending on whether dividends are included and which period you look at.
The important catch: price swings and the risk of loss
That return is a historical average, not a guarantee. Along the way, your portfolio can sit deep in the red for extended periods. The MSCI World has seen drawdowns of 40 percent or more multiple times, including during the 2008 financial crisis and the 2020 pandemic crash. Investors who stayed invested through those periods historically recovered within a few years. But anyone forced to sell during the downturn, because they needed the money short-term, locked in real losses.
That’s exactly why your emergency fund needs to stay separate from your portfolio: it means you’re never forced to sell during a crash. With individual stocks or cryptocurrencies, the risk runs even higher. A single position can theoretically go to zero, whereas a broadly diversified global ETF practically never drops to nothing, simply because it is backed by lots of companies across a wide range of industries.
Three ways to build your portfolio
To keep things manageable, we’ll focus on three fundamentally different approaches.
Type 1: Buy the benchmark – passive ETF savings plans
The simplest, most historically proven strategy: buy the entire global market through an ETF savings plan and let compound growth work over 15+ years, instead of picking individual stocks. To illustrate the power of compounding: if you invest 200 euros monthly for 20 years and assume an average annual market growth of 7 percent, you contribute 48,000 Euro in total out of your own pocket. In the end, your wealth grows to around 100,000 Euro before taxes, meaning your money has more than doubled based on historical averages.
At practically every major German broker, account maintenance itself is free, and many ETFs can be bought via savings plan with zero execution fees, some providers even offer this on their entire ETF range. That said, every ETF carries an ongoing product cost (the TER, typically 0.1 to 0.3 percent per year) plus standard market spreads, this applies across all providers equally and barely matters for long-term investors.
Recommended brokers for this path: Traders Place (Ad) and Trade Republic (Ad). We’ll cover each of these in detail on dedicated pages soon.
Type 2: Trade actively – individual stocks, trading and crypto
Some investors want to aim beyond the market average: analyzing individual stocks, timing entries and exits, or adding cryptocurrencies like Bitcoin or Ethereum. This can pay off — but it’s significantly more work and risk than the ETF approach, and there’s no guarantee you’ll actually beat the broader market. Studies consistently show that most retail investors who actively trade individual stocks underperform a simple world ETF over the long run, since timing mistakes and fees eat into returns.
If you still want to go this route, maybe because you enjoy it or want to follow specific companies closely, low order fees and access to many exchanges matter most. At most modern neobrokers, account maintenance is free, while individual trades cost anywhere from zero to a few euros per order, depending on the provider — far less than traditional branch banks.
Recommended brokers for this path: Traders Place (Ad) and Smartbroker+ (Ad). Detailed reviews of each are coming soon.
Type 3: Fully automated – the Robo-Advisor
If you’d rather not deal with ETFs, indices, or brokers at all but still want your money working for you, a digital wealth manager handles everything. It assesses your risk tolerance once and then builds, monitors, and automatically rebalances your portfolio in the background. In return, you typically pay an annual management fee of around 0.5 to 1 percent of your invested assets, on top of the ETFs’ own product costs—somewhat more than doing it yourself, but with zero effort required.
Recommended providers for this path: Quirion (Ad) and Growney (Ad). Dedicated deep-dive pages for these are coming as well.
Crucial insider tip for expats: German taxes
Whichever path you choose, it’s usually best to pick a broker legally based in Germany. German providers automatically calculate and withhold capital gains tax and send it to the tax office on your behalf, and just like with instant-access savings, you can set up a Freistellungsauftrag to receive up to 1,000 Euro in capital gains tax-free per year. If you use a purely foreign broker without a German entity, you’ll need to declare every gain yourself in your annual German tax return.